In my experience as a real estate agency profit consultant, I’ve seen many real estate businesses in grave financial trouble, and many spend themselves into oblivion. For businesses to survive and thrive, they must be built on solid financial foundations.
This is explained in depth in our four-day presentation of the Agency Profit System®, but here are some important foundations that all leaders should strive to have in place. MORE
Individuals and households that spend all they earn are just one pay-day from bankruptcy. Businesses are no different. If you aren’t saving, you have no buffer for lean months.
Expenses under control
One office spent $112,000 in a single month on premium advertising. That’s what we call “Double-D” – Dumb and Dangerous. This money was spent because the agency’s salespeople did not know how to list properties without committing the agency to massive advertising spending. If you think the agency recouped the expense through Vendor Paid Advertising, you’d be wrong.
If a fraction of that money was spent on training the team, they would list properties without the requirement for massive advertising or fee discounting. This agency’s expenses were out of control – but they are not alone.
Borrowing to buy investments is perfectly fine, provided you don’t extend yourself too far. I personally do not feel comfortable with more than 30% debt-to-equity, excluding the family home.
‘Dumb Debt’ is the worst debt. Dumb Debt is borrowing to buy anything that goes down in value – car leases, equipment leases, credit card spending where the debt is not paid out at the end of each month. Spend too much on Dumb Debt and saving will suffer.
Family home fully paid
When you go to bed, owning the roof under which you sleep is an essential goal. Pay out your home, and don’t use it as a gambling chip by securing it against business spending.
The sooner you start investing, the sooner you become wealthy. Save and invest in quality real estate and blue chip shares.
Businesses haemorrhage huge amounts through team incompetence. Every time salespeople lose listings to the opposition, it costs the agency dearly. It would be the biggest financial loss in most real estate offices, in addition to the damage caused to the company’s reputation by having incompetent representatives.
Training is a bargain by comparison to losses through incompetence of the team and the leader.
Income is not profit. If you want to maximise your profit, you need to take your focus off turnover and put it onto profit. You need profit systems to ensure that this happens. This is why so many agency leaders use Pittard’s Agency Profit System®: profit does not happen without systems!
Profit is not a dirty word!
Buildings without solid foundations crack over time. The same is true for businesses. Profit is not a dirty word. There is nothing wrong with making a profit, provided you do so honestly.
In fact, if you are a business owner, it’s your duty. Why else did you go into business?
Have you ever noticed how some people say five sentences when a ‘Yes’ or ‘No’ would have sufficed? Some people speak a lot but say little. Real estate agencies cannot afford to have team members like that.
In this short leadership session, real estate agency profit consultant, Gary Pittard, says that salespeople who waffle confuse clients and lose business. Salespeople who waffle to their colleagues lose respect. Cut to the chase – every team will benefit from some straight talk.
Some people say you must love your work. I agree that this is desirable, but it’s not always realistic. Pursuing this ideal could cost you a great career.
Author Larry Winget says you don’t have to love what you do, but if you accept payment to do a job, whether you love it or not, you have a moral obligation to do it well.
Let’s face it, a sales job is tough. When you first start this career, chances are high you’re not going to like it, or at least not every aspect – prospecting for example. But this is irrelevant. Like the task or not, some tasks are essential to success and longevity – prospecting for example! MORE
When you start, you make a lot of mistakes. Failure is a necessary step in the learning process, and a necessary step in the success journey. I often say, “It’s hard to love something you suck at”. So it can be in the early days of a sales career.
But don’t quit too early because you don’t love it. Given time, study, practice and a high level of the right actions, success will come. And with success, love for the career will blossom.
I don’t want to sound like an incurable romantic, but I do love Sales. But I didn’t when I first started.
How did I turn doubt and distress into love?
Do these things and success is assured. You will begin to see successes – firstly small ones, then larger successes as your skill builds.
And from these successes you may come to love your work. Sure, you won’t like every aspect of your work. Who does, honestly? But just as it’s hard to love something you suck at, once you stop ‘sucking’, it’s hard not to love a career that gives you so much opportunity to help people and earn a high income. Remember, good things take time.
It all begins with not sucking!
Written and video reviews are essential. To quote one winning salesperson: “These days, clients go online and do research on you. At the listing presentation, they verify what they already know”. She’s right. Real estate agents who pay little heed to client reviews will lose many listings to their opposition.
And those reviews must be genuine – never ‘fake happiness’. In this short sales session, real estate agency profit consultant, Gary Pittard, says that there is no need to ‘fake happiness’. Obtaining reviews from happy clients is not at all difficult.
Of all sayings, I despise this the most: “If it ain’t broke, don’t fix it”.
I have heard people use this phrase as justification for not training, not leading, not prospecting, not developing a team, as justification for leaving things exactly as they are.
To illustrate how stupid and dangerous this is, let’s apply it to your car. Would you drive your car, kilometre after kilometre, never adding oil, checking the tyre pressure or having it serviced? Would you just drive it into the ground?
Why not? “If it ain’t broke, don’t fix it!”
Treat a car this way and soon it will be ‘broke’ and you will need to fix it. A hefty repair bill will follow.
Imagine if you did this to your business!
Sad news: MANY LEADERS DO!
Leaders who don’t study leadership or work at developing their teams, who fail to determine a culture and set standards, fail to control expenses, fail to keep a watchful eye on profit, who lack discipline, are leading their companies downwards.
There is no marking time. You can’t stay exactly where you are.
You’re either going backwards or forwards, and it’s up to you, the leader, to decide in which direction you will take your company.
Great leaders constantly fine-tune their company and their team for peak performance. Leaders who fail to do this are attempting to mark time, not realising that they are, in fact, going backwards.
A leader who thinks, “If it ain’t broke, don’t fix it” may have a business that is doing fine now, but it’s only a matter of time before the business will be ‘broke’ and the leader in damage control – and probably broke too.
Ditch the loser saying and replace it with this one:
“If it ain’t broke, build on it!”
What most real estate agents refer to as ‘Marketing’ is really nothing more than ‘Advertising’. Advertising is just one small component of the large umbrella that is Marketing. Agents place ads on property portals, they erect signs and distribute leaflets, but these are all advertising. What other MARKETING do they do? Not much really.
In this short leadership session, real estate agency profit consultant, Gary Pittard, explores one marketing channel that is guaranteed to put money in the bank.
Some years ago, I presented a Field Challenges workshop in Perth. Participants submitted for discussion challenges they were facing in the field. A few topics were offered and dispatched quickly as the solutions were obvious.
I then read to the audience a field challenge submitted by email and asked the audience if that challenge affected anybody. All hands went up. MORE
The challenge centred around objections raised by clients after they had spoken to a competing agent. In effect, the competing agent was feeding clients with objections to raise with other agents.
We spent the rest of the workshop on that one challenge, the audience commenting later that they learned a lot.
Then I made a confession: the email was actually sent to me in 1993 – around 12 years before this workshop!
It doesn’t matter what those objections were. My point is, they were the same objections recurring over a period of 12 years. Wouldn’t you think that agents who are faced with the same objections repeatedly would learn how to overcome them?
Stop giving competitors free shots!
Competitors are going to lie to win listings. Get used to it. Learn to combat it.
Competitors are going to discount to win listings. Get used to it. Learn to combat it.
Competitors are going to make disparaging remarks about you. Get used to it. Learn to combat it.
Your competition is predictable. The salesperson who makes disparaging remarks about you won’t do so only once. These people do very little training – the fact that they resort to such low and desperate tactics shows this – and their behaviour is predictable.
All you need to know is the name of the competing salesperson and you know what he or she is saying to win listings. Think about what they say, learn ways to overcome those objections and, whenever you are competing with that salesperson for a listing, combat the objections that you know are coming. Even if the client doesn’t voice the objections, you can deal with them anyway.
At a workshop in New Zealand, an audience member said that whenever a certain competing salesperson was told by a client that they were talking with XYZ Real Estate, this salesperson said, “They’re amateurs”. It is so easy to destroy tacky lines like this.
All the salesperson had to say was this: “You’re talking with x from xx Real Estate? They’re a good company. Could I ask you something in confidence? Did x say that we’re amateurs? He usually does.”
The sellers will sheepishly reply, “Yes”, to which you say, “Has that been your impression of me so far?” Followed by, “It’s a pity he chooses to say that about us. Funny thing is, a true professional would never say such a thing. I thought they were better than that.” Job done.
Then you go on to prove why those sellers should choose you.
There are times when you can ignore your competitors and there are times when you must stand your ground and stop giving them free shots. Standing your ground doesn’t mean being aggressive. It doesn’t mean being a door mat either!
“Every task is accomplished piece by piece, and every problem is solved one by one. ‘Problem Stacking’ is a sure way to get nothing done”, says real estate agency profit consultant, Gary Pittard.
In this short sales session, Gary explains that when we stack our problems, we focus on how much there is to do and how hard it’s all going to be, and then we do nothing. There is a better, and smarter, way.
In the eighties, management expert Michael Gerber coined a phrase that became popular across the world: “Work on your business, not in your business”. A lot of us were very excited to hear that.
I still am. However, I saw a few people send their business bankrupt and then blame Gerber’s maxim. Let me make it clear: it wasn’t Gerber’s fault. His ideas were sound then and now. What these leaders overlooked was the word “Work”. WORK on your business… MORE
Over the ensuing decades, I saw some leaders turn their back on their business by appointing an ineffective manager who ran the business into the ground.
And the “Work” that was supposed to happen? It didn’t happen either. The systems urged by Gerber failed to materialise.
Another of Michael Gerber’s maxims was:
“Systems run the business. People run the systems.”
This is what these leaders were supposed to do: find or design profit systems for their businesses. Without profit systems, a business is highly susceptible to the winds of change, especially the market.
Some businesses generated large sums, often from income generated by the leader, but turnover and profit are different things.
These are some of many systems a real estate agency needs to maximise profit.
Big profit requires comprehensive profit systems.
How would you rate your profit systems?
It is no secret that far too many business people, salespeople and leaders, hold training in low regard. In this short leadership session, real estate agency profit consultant, Gary Pittard, asks, “Whose bright idea is this?”
How would you feel if you went to a doctor who qualified in 1960, but who never attended a training course since? Mediocrity and lack of training are close cousins!
Salespeople spend a lot of time trying to convince sellers how good they are. They talk about the advertising they do, the awards they’ve won, the results they’ve had. The trouble is, too many salespeople make the presentation all about themselves.
Whether your clients are buyers, sellers, landlords or tenants, they are all out to look after themselves. Most are fair, but in their minds, their own interests are paramount. MORE
Buyers may have little choice of the agents from whom they purchase, but salespeople who fail to look after them have no chance of ever being invited back to discuss the sale of those properties when the buyers decide to sell. Salespeople who disclose one buyer’s offer to another, who treat buyers badly, or who resort to other questionable tactics will only ever take advantage of those clients once.
Sellers and landlords have more choice. They can choose the agent they like the best and are in a better position to negotiate terms that are favourable to them. Salespeople who give client-centric presentations, who take the time to ask good questions and find out what’s important to their clients, give themselves a huge advantage over their competition.
Once you know what is important to your clients, you can tailor your presentations toward showing them why they should use you. You position yourself to answer the question: “Why you?”
Read the Play
Too few salespeople actually listen to what is going on around them. They fail to ‘read the play’. They encounter the same objections again and again, but never stop to think if there is a better way to handle those objections, or even smarter, avoid them altogether.
So slow down a little when you’re with clients. Ask good questions and find out what is important to them. Tailor your presentation toward proving that you are different from your competitors, that you are a better choice because you deliver solutions to clients. Make the presentation all about them.
Why you? Because they got to know, like and trust you. The promises you make are what your clients want and need. And you deliver on your promises.
If you have received even a modicum of real estate training, you know about SMART Goals: specific, measurable, achievable, realistic, and achievable in a realistic time frame. MORE