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Business PlanningBusiness Planning
Been there, Done That-Got the T-Shirt
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Looking Back at 2008Reasons to Fail
1.) No buyers
2.) Slow Opens
3.) Unorganized
4.) Poor attitude
5.) No data base
Contact-mgmt
6.) I’m not lucky
What you should do1.) Look for buyers
2.) Find a high traffic open
3.) Get organized!
4.) Be positive everyday!
5.) Work on your data base
6.) Be prepared
It’s your choice! Everyday you wake up make a plan of action and follow through! Get something accomplished!
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What can a business plan do for you?
• No plan…no progress
• Its an outline for your goals, aspirations, expectations and financial needs
• A well-developed plan is your most important business too.
• Step-by-step it translates your ideas into profitability
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Pros of being an independent contractor
• Opportunity to make more money than as an employee
• Being your own boss
• Job Security
• Able to put your ideas into practice
• Personal satisfaction of creating and running a successful business
• Able to work in a field you really enjoy
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Cons
• Possibility of financial risk
• May have to work long hours
• Income is not steady
• No healthcare benefits
• Will have to perform many business disciplines
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Benefits of a written plan
• An increased chance of business success• A reality check• A timetable that helps you coordinate all
the diverse activities you need to employ• A vehicle for tracking the progress of your
business.• A blueprint against which you can adjust
activities to achieve your goals• A starting point for future planning
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Assess Where You’ve Been
Damn GPS!
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HISTORICAL PRODUCTION, EXPENSE AND ACTIVITY ANALYSIS
PRODUCTIVITY
YEAR Number of Listings Taken
Number of Listings Sold
Number of Buyer Controlled Sales
Total Volume
Average Sales Price
ACTIVITY
YEAR Number in Sphere List
Mailers/Year Number in Farm Mailers/Year Open Houses/Year
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INCOME/EXPENSE
YEAR Gross Income Annual Expenses Expenses as % of Gross Income
Net Income
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SELF QUESTIONNAIRE
Answer YES or NO to the following questions:
Do you consider Real Estate your career? _____
Did you meet your financial “goals” last year? _____
Did you meet your financial requirement last year? _____
Would you work for a company that is not making a profit? _____
Would you want you as a business partner? _____
If you were an employee and could be fired, would you work differently? _____
If you were a manager, would you require a minimum monthly production? _____
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EMPLOYER REVIEWIf you were the boss and had you as an employee in your firm, how would you rank:
X one box for each category Excellent Good Fair Poor
Attendance; worked full days
Attention to detail
Knowledge of area/product
Increase in business/production
Client satisfaction
Does this employee deserve a raise?
Should this employee be retained?
Does this employee need a performance improvement plan?
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Figuring your commission
Your average home sale price ______
Times your average commission rate ____
Less Franchise fee _____
Times your split (65%) _____
_______ = Your average commission
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Plan your time commitment
52 weeks/year less_____weeks vacation =
7 days/week less ____ days off/week =
____ weeks times ____ days/week =
What time will you go in to work? ________
How long is your lunch break? ________
What time will you leave work? ________
Does this add up to at least 40 hours/week? _____
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Let’s do the math
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Business card math
I will hand out just ____ business cards/day.Only ____ days per week.Only ___ weeks per year.If I have only a 1% conversion rate.With my average of $________ transaction.
I will make $___________
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Open house math
I will do ____open houses/mo. X ____ Mo= _____ O.H. this year____ groups/o.h. X ____ = ____ groups10% capture rate X ___ = ____ clients
===========____Clients X my avg. comm
= $________ Income
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Sphere of income math
The Premise:• Everyone you know, knows at least
one person per year that has a real estate need.
• Only 50% of your SOI will send you a lead.
• Only 50% of those leads are viable.
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You have ____ people in your SOI = _____
During 2009 ____ % (50%) will provide meWith the name of a potential buyer or seller X 50%
=========Potential Leads = ____
However only ____ % (50%) of those leadsare viable. Then I have X 50%
=========Potential Transactions = ____
Potential transactions X my avg. commission = _______
=========
Potential Annual Income $ __________
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Floor call math
I will sit floor ____/month.
X ____ Months = ____ Floor call this year
____ Calls/floor time X ____ = _____ Calls
10% Capture Rate X ____Calls= ____Trans.
____ Trans x My Avg. Comm.
= $_______ Income
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Farm math
I will contact my farm ____ times/year.
1% capture rate x _____ houses in farm
= ______ Trans.
_____ Trans. X $ my avg. comm.
= $_______ Income
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fsbo math
If I can convert one FSBO per _______
1 X my average commission=
= $_______ Income
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Expired listing math
If I convert one Expired per _________
1 X my average commssion =
$______ Income
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Planned income 2009• SOI Income = $• 7 Second Pres. Income = $ • Open House Income = $• Floor Income = $• Farm Income = $• FSBO Income = $ • Expired Listing Income = $• Lease Income = $
==========================Annual Income = $
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Strategic Marketing Plan
the how to
or
action plan to meet your
identified financial goals
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s.m.a.r.t.
Goals must be
• Specific
• Measureable
• Attainable
• Relevant
• Trackable
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Written goals
• What
• When
• How
• Where
• Why
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Write a
goal now
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Example
What: I will contact my farm 1 X per month.
When: By the 15th of each month.
How: Newsletter each month by email if possible or by personal delivery to door.
Where: My subdivision.
Why: $3000.00 Income
I
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ExampleWhat: I will increase my personal exposure to
my farm.
When: Every quarterHow: 1st qtr: Deliver for-get-me-not seeds
2nd qtr: Deliver 4th of July flags
3rd qtr: Deliver local sports team schedule
4th qtr: Annual Food Drive Fliers and p/u times
Where: My subdivision
Why: $3,000 Income
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Example
What: Increase my SOI by 25 people
When: By mid-year.
How: Join Book Club Group and Bunco Group
Where: Book Club at local library
Join Mary’s Bunco group.
Why: $15,000 increase in income
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Example
What: Give myself a raise in my commission!
When: Beginning NowHow: 1. No more listings discounts
2. Take 7% or 8% listings on Short Sales
3. Push back on lenders trying to lower commission
Where: at listing presentations; at short sale negotiations
Why: $5000 Raise
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