Make money on the way in to a deal

When negotiating a business transaction, insists on a large, effortless consumer surplus: make your profit “on the way in” to a deal. Never participate in a transaction where you pay market price, and effort is required to get your profit “on the way out.”

For example: if you wish to make money on a real estate deal, buy a property at one-half its market price. When you sell the property, sell it at market price. Do not attempt to earn profit by purchasing the property at market price, doing a lot of work, and selling it above market price. That would be attempting to make money “on the way out” of a deal — and it is much more risky. If you see signs in your neighborhood that say, “We buy homes for cash,” where buyers offer fast money for property at pennies on the dollar, those buyers are utilizing this maxim.