Omaha, Nebraska Contributed by David Matney with Alliance Real Estate
I read a blog post a few days back about a lack of a business plan. In the post they talked about not having a business plan. Having a business plan does not mean you will be successful. I know plenty of very successful agents that use the "fly by the seat of your pants" method. I am not a business major nor did I attend Wharton School of Business so maybe my business plan might be just too simplified for some folks. Business Plans are a living document and you should be aware of changes in the market that will necessitate adjustments to your plan. Each year I refine my plan over last years, however I do believe a business plan will increase your chances of success.
Here is a breakdown of what my business plan involves:
1) Mission Statement:
2) Goals:
A) How much money do I want to make for the year? What percentage of my business is coming from listings? What percentage is from buyer business?
B) Analysis of where my business comes from and what is my plan of attack. What is my target market? How do I reach that market. How many contacts does it take before I make a sale. How much of my business is referral from past clients? You need to give yourself an honest assessment. If I am not getting referral business, why? Am I contacting my sphere, and what is the frequency of those contacts? Am I servicing my listings properly, are they priced right, am I adding value to the transaction? Are buyer slipping though the cracks? Why? Poor follow-up, or do they perceive a lack of value in my services, etc. You can not fix something unless you know it is broke.
3) Assumptions: Look at my previous year's production numbers? How many listings did I sell? How many buyers did I close? What is my average sales price? What is the percentage of listings taken to listings sold? What commission do I charge? Average days on market?
Breakdown monthly goals based on the amount of money I want to make:
A) Work the numbers. If 75% of my business is listings what is the amount of money I have to make to achieve these numbers based on my average sales price, commission charged, commission split to meet this number. Work the same numbers on the buyer side as well. If 25% of my business is from buyers then you should know the amount of buyer business you need to close to meet those numbers.
B) Once you analyze the numbers you should have a simple breakdown. I need to close x number of listings per month and x number of buyer closings each month. Then hold yourself accountable. That way you can ask yourself, "am I doing things that will put me in front of more buyers or sellers or am I doing something that makes me feel like I accomplishing something."
4) Strengths and Weaknesses: I write down my strengths and weaknesses. The important thing for me when I write down weaknesses it makes you more aware of your weaknesses. For example, if you have a high percentage of cancelleds/expireds than you are more aware of the issue. Therefore, I believe it helps with awareness.
Some folks have a GOAL to make x number of dollars per year, but they do not have a clue on how many transactions it takes to meet that goal based on the commission they charge, their average sales price and the commission split they are under. You should also know the number of "contacts" or "touches" it takes in order to make a transaction. That way you can prospect based on the fact that I need to make contact with X number of contacts each day.
Thanks,
David Matney, CRS,GRI
