So You Want to Sell Real-estate.
A seven blog series to quick start your business
Blog 2 You’re Book of Business…. By Rick Guthrie
So when you say you’re in the real estate business what does that mean? Do you do the real estate business or do you own your real estate business? Doing the business is an activity, where owning a real estate business, to me, is more tangible. Kind of a verb and noun thing. So, you say, “well Rick Guthrie there are several real-estate companies and franchises and I’ll just hang my license at the one I like the best and sell”. My statement to that is, “great”! There is absolutely nothing wrong with that and there are a tremendous amount of agents that are very monetarily successful, by definition, that do the same thing. If we’re looking at this honestly I feel that you are basically doing the business. So how could you own your own business even within a company?
Simply you need to have a business you can sell. Now I had heard Gary Keller ask one time, “When’s the best time to sell a profitable business”? His answer was never. His thought was why would you want to sell something that brings you a positive income stream. Although that knocked me back for a moment of thought, at some point an agent may want to take what they’ve built, cash out, and walk away. Hey, this is America.
So as with any business, what are the value determiners? If you’ve owned and sold any business you know the things like desks, chairs, computers and equipment have little to no value and probably need to be replaced anyhow. Now owning real property or an improvement such as the office building itself is a no brainer. You always have something to sell or lease. OK you say, “You’re living in the clouds Rick I’m a new agent and owning any of that right now is not my first priority”. Yep I get it. So what are the other levels of value that you can start creating right now?
As with any business what do you need to have? I guess basically product, inventory and someone to sell it to. If I translate that for real estate agents that’s means for now, listings and clients. The mistake I made when starting in this business was I adopted a one shot one kill kind of attitude. In other words, I truly never understood the importance of having a book of business or some type of database. It’s been proven over and over again in this industry that having that book of business is your one true salable commodity. Just like a Doctor’s client base goes with the practice when it’s sold.
So when do you start developing that? Well…. Like yesterday? Not only, if done in the right way, will it develop into a commodity that is salable, it will bring you quick income while you’re learning. The vessel or program or software you use to store your database is primarily up to you and your needs. I think how you categorize your entries into your database and how you get reminded to stay in front of your sphere is the most important thing. For me the best database software that you can use, is the one that you’ll use. As far as developing a campaign to stay in front of your sphere go to what a lot of us call the “Red Book” or “the Millionaire Real Estate Agent by Gary Keller, Jay Papasan and Dave Jenks. If you can’t find where to get one just e-mail me and I tell you where you can get one.
In The Millionaire Real Estate Agent you’re going to find a plan called an 8X8 and 33 touch program. Study this carefully because it is the difference. Now of course to utilize this tool you need to have a sphere or entries into a database of some kind. New agents get the book and start with just 100 entries into your database. You may say, “I don’t know a hundred people”!!! Yes you do but if you didn’t could you meet 100 in 30 days? Taking two days off a week means you only have to enter 5 a day. Just commit to doing that for me and utilize the Red Book to set it up. You say, “OK Rick I’m in if you’ll tell me what that will get me”. Stats show that an 8X8 33 touch program when worked properly will net you about 1 closing for every 6 individuals in your database. So let’s look at easy numbers.
100 people in your database accounts for about 16 closings.
With an average sold price of $250,000 that’s around $108,000 in Gross Closed Commission
Subtract your expenses splits and so on it’s a pretty good piece of change.
Remember all of this can start happening now while you’re learning.Developing your database is the first step. It’s not a new concept it’s been done for decades. Some use to call it a tickler file and they had a system using 3×5 cards. It was all designed to have the same result which is to always have a pipeline of business which is a salable commodity.So new agents let’s get one going today. Veteran agents that have theirs up and going comment on the importance.
Blog at you later and “You Have a Good Month Today”