Business Planning for Productivity and Profit in Real Estate

Welcome and good morning to Mike Ferry TV. It is the week of November 30th, we have one month left to complete this year as a lot of our brokers are doing. They’re  talking about the fact that too many agents are taking too much time off, not working at all or working some of the time. And the agents that are working are doing a lot of business. The market is very strong in 90 percent of the markets in North America today. The question is, do you want to participate or do you want to watch? I said to somebody a couple of days ago that what’s really been interesting for me, and that’s because of my length of time doing the work that I do, is watching this giant gap that is being created. There’s always been a gap between those that do a lot of business and those that don’t. That’s that’s normal. But that gap is getting wider than ever because a smaller and smaller percentage are doing more and more. And our job is to have you be part of that group. So hopefully you’re going to finish the month of December strong. I want to take a moment and clarify. I had four or five emails come to me from viewers of our Mike Ferry TV, and they’ve said to me, you know, explain a little more in depth. The four points you brought up a few weeks ago on the business plan, because the business plan really revolves around four issues and they’re not complicated.

 

The pretty simple something that I know each of us can digest and then use for our advancement and productivity and profit for two thousand twenty one. The first thing I want to mention to you is I had a very fun and interesting probably 30 to 40 minute phone call with one of our coaching clients about a week and a half, ten days ago, because the person was trying to put together their business plan and was not exactly clear as to what the process should be. Although the business plan we offer, and I’m sure you’ve seen it now is is very simple. As I’ve stated, it’s only six pages and it could be probably three if you choose to condense it. So it’s not a complicated plan, but there is some thought behind it. And in doing your planning for twenty, twenty one, you have to get clear on the thoughts behind the plan. It’s the thoughts behind the plan that would make the plan work, so there’s four parts to the plan. First part of the plan is obviously setting a straightforward, simple production goal. The conversation I had with the young man a week or so ago revolved around the fact that he wanted to set as a production goal a dollar figure. I want to make two hundred and fifty thousand, which is fine. And I tried to talk him out of that and not the fact that I want him not to make two hundred and fifty thousand.

But what I wanted him to focus on is the number of transactions that he should do. So often we set our goals based on a dollar figure if we want to earn or the gross sales volume of our transactions. And that is not really a fair way to evaluate how good you are or what you’re doing. So I always say set a specific production goal. In this case, he has completed or will have completed about twenty two transactions by the end of December, the end of next month, which, by the way, starts in a day or so. His goal for and I… Took me a while to get him to set this his goal for two thousand twenty one is thirty five transactions. I said great, it’s no, it’s not a big increase but it’s a substantial increase. And the thirty five will make him the two hundred and sixty two hundred and sixty five thousand. I asked him a question. I said, why do you want to increase your production to that level? And his answer, very noble. I want to make more money. I said, great, why do you want to make more money? And he said, What do you mean? I said, well, there has to be some motivation behind the goal. There has to be some motivation behind the money that you want to earn. Are you trying to earn the money to create a better lifestyle for yourself and your family? Are you trying to earn the money to pay off some previous debt? Are you trying to earn the money to possibly start a savings account? Because he has a couple of young children that at some point will go to be going to college. Do you want to create this extra income to create an investment account for yourself and your wife and your kids? Why do you want to create the extra income? And we talked about it for probably seven or eight minutes and he wasn’t 100 percent sure.

But that tells me again that most people do not do a good job in deciding what they want to accomplish. Most of us pick a generic obvious. I want to make more money. I want to have more production. I want to be recognized in the office for being more successful. You know, these are all good, but are they really the driving force behind the goal you set; think about the driving force behind the goal you set in terms of transactions. Why do you want to accomplish this, what is the motivation? And if it is money, which is great, what are you going to do with that when you get it? But the second part of the plan was also a challenge for this young man, and that was the skill development plan that needs to go into place to achieve a higher level of productivity.

He’s doing twenty two deals. We talked about the fact that he had a couple of hang ups on a couple basic fundamental sales processes that need to be improved upon for him to achieve the goal of thirty five. I think his biggest challenge was his ability to pre-qualify. He wasn’t comfortable in talking to a seller and pre-qualifying in depth because what his fear was, and this is normal, if I pre-qualify in depth and I find out they’re not qualified, I do not have a potential appointment. And I said, good. And he said, what do you mean good? I said, well, the purpose of Pre-qualifying is to either identify that they are prepared to sign a contract with somebody or you shouldn’t be going. He said, But I want to go. I said, I know you want to go on as many appointments as you can, but what’s the value of going on appointments when they’re not motivated or are not capable of signing a contract when you get there? So we had a very interesting discussion. So my recommendation in terms of his skill development, I said let’s take the month of November, what was left in November, all of December, January and February. Let’s commit to three and a half months of role playing and practicing the Pre-qualifying questions for 30 minutes today. I said you’ve got to get comfortable asking the questions. But then the second thing I said to him, let’s make a very strong personal commitment to ourselves that we will not under any circumstance go on a Listing Presentation without pre-qualifying the seller one hundred percent before you go out. And he actually said, oh, that could be tough. I said, Why? He said, well, some of these people are people that are referrals that I know real well and I don’t want to create an invasion of privacy. I said, no, no, no. I said, think about it this way. You go to the doctor. The doctor is going to ask you a lot of very probably invasive questions about what’s going on so they can offer a cure you want. Oh, I never thought of it that way. So I said, let’s put together a plan. Now, One, you’re going to practice and play the questions 30 minutes a day for the next three months. And I don’t think he likes that. But number two, you’re going to commit a hundred percent to Pre-qualifying every person. And he finally admitted he may lose a couple of appointments if that is the case. And I said if you lose a couple of appointments, that’s OK, because then you’re going to learn that you’re not going to waste your time with people that can’t do something. He brought up the blinding flash of the obvious. He said, well, do you think if I go on some of these non-qualified appointments, I could convince them to sell? And is my head shaking yes or no?

It’s so unlikely; the third part of the plan was, of course, understanding the numbers and getting clear on the fact that there are certain things in a business that have to be done. And one is to recognize that numbers are what are behind a business and its growth. And number two, tracking them so you can then determine what can you do differently based on your numbers to achieve the goals you’ve set. So you’ve got to track your numbers, and I know that 90 percent of the people in Real Estate, ninety nine point ninety five percent have probably ninety eight percent of the people in Real Estate are challenged with keeping track of their numbers because we don’t want to see what we didn’t do. And if you didn’t do anything and you have to chart that it’s not a very pleasant feeling, but the only way to learn and to grow is to track your numbers. And then the fourth part of the plan, of course, which is is as important as parts one, two and three, is your prospecting lead generation plan that you’re going to follow for the year, because if you’re not following the plan for yourself as to how you’re going to create business, you’re going to do some things that you’re probably not going to enjoy the experience very much.

For example, doing more mailings, running more ads, more social media, they all work. But what works better; conversations and talking to people. So we had a very interesting discussion, this young man and myself. And I do believe that we helped him get a better understanding of the business plan, go online to Mike Ferry dot com, download the business plan. If you haven’t completed it, let’s get it completed. Then give a copy to your broker, to your manager, if you’re married to your spouse or your partner, give a copy to your accountability partners, to your roleplay partners, to your Mastermind Group, get other people engaged so they can hold you accountable to your plan. If you do it, two thousand twenty one is going to be a great year for you. And we’re here to help you make that happen. Have a good day. Talk to you next week.

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