Every real estate business has a Break Even Point (BEP). The leader might not know what it is, but that doesn’t alter the fact that the office needs so many sales to break even. Beyond BEP, the office begins to make a profit. It’s that simple.
Smart leaders know the break even point for each department in the agency – the BEP for the rental department, the BEP for the sales department, and for any other department operated by the business, strata management for example. If you don’t know your BEP you’re flying blind.
But knowing your BEP and exceeding it are not the same. I often see leaders who reach the end of the month and are surprised that the sales team has performed poorly. Profit should never be a surprise, nor should falling short of your BEP. As leader, you’ve got to know how your agency is doing at all times.
There are two tools that are vital for keeping your agency on track to achieve its listings and sales targets: the sales meeting and the action sheet.
In every month there are four sales meetings. They don’t always land on the 7th, 14th, 21st and 28th of each month, but your sales meetings roughly divide the month into four. This gives you four opportunities to correct results if the agency, or any salesperson in the agency, is behind target.
You don’t wait until the 21st to act – that’s too late. You begin correcting from the first sales meeting each month. If you are behind on the 7th, or the first sales meeting of the month, increase actions so that you are back on track by the 14th, or the second sales meeting of the month.
Set actions with the team to get back on track and record those on an action sheet:
- You might agree with a team member who is short of listings to increase his or her prospecting in the coming week, increasing the prospecting calls to 300 for the week, for example.
- Or you might have your best lister, whose stock isn’t selling, to visit four vendors and obtain price reductions.
I’m sure you get the idea – don’t wait for results to happen, and certainly don’t hope. DRIVE results by focusing on the actions that lead to those results.
Decisive leadership, dynamic sales meetings, and actions that are committed to by salespeople, recorded on an action sheet, and carried out by the salespeople, put the focus on the right actions. Those right actions bring results.
Making profit or falling short of target – it’s no surprise.