Business. Plan. Separately, the words are simple, almost inspiring. Put them together and – wham! – instant overwhelm. A real estate business plan can be as long and as involved as you want it to be. If the goal is to set goals and keep track of them throughout the year, then fear not, you can create a business plan that is an active tool and effectively guides you and your real estate business towards success!
How to Set Up a Simple Business Plan
If you want to pare down your business plan into a tidy yet comprehensive page of information, then you need to include only a few things in a handy table that you draw or create in a spreadsheet. Here’s what to include.
- Three columns of information: Last Year’s Actual Numbers, This Year’s Goals and the % change between the two. The percent change will give you a relative idea of how much growth you expect from last year to this year and show you how much effort you may need to put in order to grow.
- Rows of information: Total dollar volume, listings you acquired, listings you sold, leads, buyers sold, commissions, average sales price, average commissions, average commission percent to sales, number of referrals you made for other agents.
That’s it! You now have a bird’s eye view of where your business is, where you’d like it to grow and by how much.
Activating Your Business Plan
No business plan is any good stashed away in a notebook or in a folder on your computer. Use it and use it often! First and foremost, determine just how many more people you have to contact in order to reach your goals. For example, if you had 1,000 leads and the total listings you acquired were 100 last year, then your conversion rate is a sold 10%. Extrapolating that percentage, if you want to acquire 200 leads, then you would need to contact 2,000 leads.
Now, you ask, that’s great, can I clone myself, too? That sure is a lot more calls to make. That’s where using your resources such as assistants and technology come into play. Perhaps you assign your assistant certain follow-up tasks or implement a better, automated follow-up system. Whatever you decide that will help you work smarter and not harder (or longer!) then make sure you take advantage of it.
Making Sense of the Numbers
Sometimes the opportunities to grow are right in front of you. Having a simple business plan can easily make those opportunities clear. You just have to do a little analysis.
For example, if you would like to improve your commission from year to year, take a good hard look at why its so low. Are you inadvertently giving away thousands of dollars in commission by setting your standards low? Are you missing opportunities to be handle transactions on both sides of the equation? Once you answer these kind of question, make an effort to be more aggressive in your commission structure and go after it.
Could your follow-up plan use some refinement? Then add more and more meaningful activities to your schedule. Here’s an idea for mailouts to your exisiting database:
- January – New Year’s postcard
- February – Newsletter
- March to May – Postcard each month
- June to July – Send out the local baseball schedule
- November – Thanksgiving card
- December – Holiday card
Also, call more often to even the same prospects. Say you have 700 people in your database. What would one more call do throughout the year to grow your business? Incorporate that into your CRM system and follow through.
What other forms of advertising worked for you? Internet, television ads, shopping carts? If you measure it consistently, you can also learn how much of your business comes from those sources and increase your spend on those to increase your business.
Also, keep a very simple journal of activities so you can apply what does work the next year and increase those activities.
By keeping your business plan simple and focused, you will find it much easier to follow and refer to daily, weekly and monthly.