- We all know the rule in real estate: the work -- or the lack there of --you do in the fourth quarter will show up in your results the first quarter.
- Because everything in this business is 60-90 days out, it makes sense to do your business planning in September and October. It's critical to have a plan in place by November.
- Break your business plan down to the lowest common denominator to ensure success.
It’s business planning time.
If you didn’t finish your plan in October, then you need to get it done by the end of November.
We all know the rule in real estate: The work you do in the fourth quarter will show up in your results the first quarter. (Or: The lack of effort and focus in the fourth quarter will be reflected in your bank account the first quarter.)
Because everything in this business is 60 to 90 days out, it makes sense to do your business planning in September and October.
That way, you’re in full lead generation mode fourth quarter to hit your first-quarter goals. The general concept is power-up fourth quarter, get ahead of the competition and nail your first-quarter goals.
Have you done your business planning yet?
I have a Realtor friend in Austin who took her team of two to a nearby resort last week for two days of 2017 planning. I’m sure there was a spa visit involved.
That type of business planning retreat makes sense in so many ways. It’s that crucial to have a strong business plan in place.
A little help
I found four articles on Inman by searching “business planning.” All worthy of a read:
- “How to build an impactful real estate business plan“
- “How to business plan successfully as an agent“
- “4 ways to start working on your 2016 business plan now“
- “5 ways to start planning for 2017 today“
Solid business planner or not, these articles are full of tips to help with your 2017 planning.
There are also a lot of tools and calculators out there to help you plan.
Keller Williams has a robust planning tool called the Career Growth Initiative (CGI). Similarly, Placester has a tool, and Zillow has one, too.
I also like this one with The Flyer Box Club; I Googled and found others.
Your firm most likely has one. Ask!
An over-simplified method to business planning
But the main purpose of this article is to give you an over-simplified guide to real estate business planning.
I have encountered way too many real estate agents who never really sit down to do the math on their financial goals (that falls into the category of not being a good boss, but that’s another article). If you do anything, do this.
Start here, do the math — the over-simplified real estate agent business planning tool:
How many closings do you need to hit your goal?
- Write down your commission goal. I’ll say $100,000
- Write down your average sales price. I’ll say $250,000
- Multiply B times your average commission. Mine is 3 percent, which equals $7,500
- Divide 1 by 3. $100,000 divided by $7,500 equals 13.3. This tells me I need 13 transactions to hit my commission goal
- Now build a plan around that.
Let’s take it one step further by taking a closer look at the funnel:
- That’s about one closing per month. (Tip: Why not round that up to two?)
- How many appointments do I need every month to close on one or two clients per month?
- How many leads do I need to generate those appointments?
- How many conversations do I need to generate those leads?
- How many hours do I need on solid lead generation to create those conversations?
What’s the lowest common denominator in your business success funnel? Time. Conversations, and time.
Stop over-complicating this business.
Want to give yourself a raise? Start with time on conversations.
More conversations, more leads. More leads, more appointments. More appointments — you get the picture.
Happy planning.
Julie Nelson is the chief success officer at The Nelson Project, Keller Williams Realty in Austin, Texas. You can follow her on YouTube or Twitter.
