Many people who open real estate agencies expect it to be easier than it eventually turns out to be. Many suffer from the Field of Dreams thinking, “If you build it, they will come”. That doesn’t happen very often.
It does not take long for agency owners to realise that Get Rich Quick is not a plan. Most times, business is a hard slog, which can be made harder by a lack of planning and a lack of training.
In almost three decades as a real estate agency profit consultant™, I have seen few agencies that have a business plan. While get rich quick is not a plan, neither is it smart to have no plan at all – at least if you want to become financially independent through your business!
The Challenges
- Businesses with leaders who were good salespeople usually have leaders who get caught up listing and selling, instead of growing and developing their teams.
- Businesses with leaders who were good managers often have leaders that are good at saying ‘no’ to everything, including expenses that might grow the business. Any fool can say ‘no’ to everything. Good management requires making decisions that grow the business.
- Most businesses have leaders who hire either ‘by gut feel’ or by poaching their competitors’ salespeople. Neither are successful hiring plans.
- Most businesses have no idea where their income will come from – what marketing sources will bring them listings and sales. This leads to haphazard marketing and inconsistent results.
- Most real estate businesses need listings, but spend most of their marketing dollars to attract buyers.
- Most businesses have no plans for finding, inducting and developing salespeople. Most salespeople in the real estate industry produce mediocre results (as is evidenced by industry averages).
- Most businesses continue flogging the same tired industry practices (debit/credit reward schemes, high commission-only percentages, sales systems with no points of difference for example) despite evidence that those practices are unprofitable.
If by now you have realised that get rich quick is not a plan, and if you do not have a business plan at all, may I ask, are you happy with the profits you make from your residential sales department?
Now, take out your own PERSONAL PRODUCTION. Are you still happy?
If you are not happy, this means that your sales department would not be profitable without your own personal production. While you are in this state, you do not have a business, you have a job – essentially, as a salesperson in your own company.
Consider doing something different. Formulate a business plan – take control of the direction of your business.
And if you need a hand with a good plan, please do contact me.