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Ever notice how some new
licensees seem to make fewer false starts than others? Old timers
in the business are often astounded by the ability of some newly
licensed individuals to
generate business, learn the necessary computer programs, and generally
get off to a much faster start that they did back in the day. What
do these early bloomers know that the rest of us did not?
Today's new licensees know
they have to hit the ground running if they are to survive. Gone
are the kinder, gentler times when the relatively low cost of getting
and established in the real estate business provided a fairly long
period of time in which newbies could find their ideal
market. Many of today's industry leaders will admit to less
than stellar beginnings, and twenty years ago it was possible for
newcomers to survive a three or six month period without generating
much income.
The thought
of today's newcomers taking such an extended time period to become
profit centers
strikes terror into the hearts of brokers who are faced with mountainous
operating costs. It is equally as frightening to the newcomers
themselves who are also faced with the high costs of becoming licensed
and establishing a clientele.
Most successful brokers
have developed business plans that optimize their resources and
minimize their risk. Salespersons, however, seldom think of themselves
as a business and it follows that they do not envision the need
for a business plan. When it's necessary to generate a good
bit of income in a relatively short time in a business that
is largely unknown to the worker, having a business plan might be
a very good thing.
While all business
plans tend to have similar areas of concern, each salesperson
should develop a plan that is personalized to his/her own resources
and goals. Answering the questions below realistically and honestly
will result in the beginnings of a business plan.
Keep in mind that a business
plan is a work in progress that will never be perfected. Individuals
grow in experience and knowledge and change interests, and business
plans should reflect the individuals. The most important feature
of a good business plan is flexibility.
Can you describe the
business you want to cultivate?
It is impossible
for a person to succeed
over a long time period in a business that he/she does not understand.
Almost all practitioners
begin using the scattergun approach - taking their best shot at
all available business and hoping to hit on some. The scattergun
approach to real estate sales has the advantages of being intuitive
and traditional, but it and real estate sales careers lose
appeal when no income results.
Each salesperson must develop a clear
picture of the business he/she will pursue and the efforts it will take to make
that business happen. Failing to grasp that essential of the business may be
the factor that contributes most to the eighty-five percent failure rate of
newcomers within the first two years of licensing.
Clearly defined
work and reward goals should be formulated. There is a reason that
work and reward are considered together; without work
rewards will not be realized, and without rewards work becomes
meaningless. With this relationship in mind, a salesperson should
identify the rewards desired and make a realistic
assessment of the work that will be required to attain the reward.
For example, if the reward desired
is achievement of a certain sales production level, then the work description
should include daily or weekly estimates of the specific jobs that will have
to be done in order to hit the level. Salespersons wanting to achieve a specified
sales production level without work plans for making it happen are involved
in a business fantasy, not a business plan.
The great coach and motivator, Vince
Lombardi, said that luck is what happens when planning meets opportunity. Most
successful practitioners in any field report that the harder they work, the
luckier they get, and the real estate sales field is no exception.
How will you market yourself?
Identifying the type of business
to be pursued and the time, effort and resources the pursuit will require lays
the foundation for a marketing plan. A workable marketing plan always begins
with identifying and locating the target population from which clients and/or
customers will be selected.
Since it is possible to
convert customers to clients, pinpointing sources
of customers is the most logical starting place. The tried-and-true
methods for locating customers dictate that salespersons wishing
to sell residential property will probably have good luck locating
buyers through such activities as holding houses open and attending
first time buyers' seminars while if selling commercial property
is the salesperson's choice, he/she may have better luck at meetings
of civic organizations. Obviously, salespersons that generate original
sources of customers are a step ahead of the competition, but working
the conventional sources while waiting for inspiration is usually
the most productive approach. As long as no laws are broken and
ethics remain fairly high, where customers are found should be between
the customers and the salesperson.
Once customers are found the second
part of the marketing plan, finding salable properties, comes into play. Newcomers
may not have a large number of personal listings to offer buyers. Luck and pluck
and not too much knowledge are often easier to sell to buyers than to sellers.
After all, the sellers have already experienced a real estate transaction and
may be wary of licensees who have not. Members of multiple listing services
are able to offer to prospective buyers all listings of all brokers belonging
to the same service.
If a broker insists that new salespersons
must at least try to capture listings, there is no better bait than the availability
of a group of qualified buyers. (Note: many agents choose not to represent both
buyers and sellers. Those who choose to represent only buyers are known as Exclusive
Buyer Agents, or EBAs)
Having located sources of both qualified
buyers and salable properties the last ingredient of the marketing plan, personal
marketing, enters the scene. Personal marketing plans come in as many forms
as there are individuals on Earth. A personal marketing plan can be as simple
as a letter of recommendation or as complex as the major promotional efforts
required to elect a politician. Whether simple or complex, the principal requirements
of any personal marketing schemes are that it be legal, ethical and that it
must work.
Everyone who wishes to succeed in
real estate sales must be involved in personal marketing at all times. This
means that every single contact with another human being whether face-to-face
or through a distance contact medium such as telephone or email is a personal
marketing situation. Successful real estate salespersons understand this and
accept that they must put their best foot forward in all public and semi public
places. If your personal brochure has a photo of you flashing a giant smile,
you must also smile at two am when you are in the express checkout at the supermarket
clutching lunchmeat for the next day's lunches. While within your target market
you will never again know the luxury of letting it all hang out!
Is the competition for
business fierce?
Sure it is. If real estate sales
were easy, everyone would be doing very well. Instead, about twenty percent
of the sales force is doing about eighty percent of the business. To become
part of the twenty percent rather than the eighty percent requires plenty effort
and creative use of resources.
The smart newcomer will devote the
necessary time to studying the competition, noting what the heavy hitters do
to distinguish themselves from the crowd. The really smart ones know that doing
exactly what the superstars do will only make them pale imitations. Studying
many high achievers rather than focusing on one will almost surely lead you
to the realization that while they have some things in common they also vary
widely in others. One common characteristic is that they are extremely hard
working and persistent. Ways in which they vary are infinite. In fact, the one
way in which the infinite variety among superstars is always the same is that
they have found ways to use their unique characteristics for effective networking.
When you're brand new at the game
it may take a while to realize which of your unique characteristics will help
you make the giant leap from mediocre to stellar. This time is best used to
develop the strong work ethic you will need when you do discover yourself. Don't
be too surprised if hard work and persistence are enough to set you apart from
the rest of the "medium" hitters! Your chances of finding a client
are much better at an open house than in the break room in your office - no
one there is going use your services to buy or sell anything.
There's no one to tell
me what to do! Hooray?
When real estate brokers are in recruiting
mode they often flatter prospective new hires by observing that they look like
real "Self Starters." When brokers and motivational speakers use the
term "self starters" what they really mean is that there will be no
direct supervision. To many wage slaves that sounds like the good news, and
to a certain extent it is. There will definitely be no hovering boss telling
you exactly what to do every minute of the day. There will also be no one to
tell you how to avoid trouble and what to do when you find yourself in it with
both feet. Keep in mind the old sales rule of thumb - if you're not in trouble
with somebody, you're probably not networking a large enough consumer pool.
So what do you do when you find yourself
in need of information, support, gratification or a couple of aspirin? Take
a page from the local undertaker's book and face up to these unpleasant facts
on a pre need basis. Always be on the lookout for folks in the business who
can handle adversity with style and/or grace. Be very nice to those folks. Do
as many favors for them as you can. In your time of need at least one of them
will be able and willing to help you out.
This is a single process that you
can have in place for trying times. It is also a good idea to have in place
processes for handling contracts and all the various paper created by real estate
transactions. You should have a process for: keeping on hand all the blank contract
forms you might need, contact information for potential clients and customers,
contact information for networking, licensing documents, and so on. If you have
no processes in place you will spend a huge portion of your time and energy
searching for people and/or paper. This is time that is much more profitably
spent networking for buyers and sellers.
Can I afford this job?
That actually should be the first
question rather than the last, and only you can answer it. If you haven't already
made this discovery you are about to learn that it can be very expensive to
be in the real estate business if you're not generating income. Before quitting
your odious and hated job to go into real estate, you should have made a detailed
list of all the costs you'd have to bear in your first six months. To the total
of those costs you should add the income you will lose by not having your salaried
position. Note: you may want to have a brown bag handy if you tend to hyperventilate.
If you can't afford to cover all
your costs without income for several months you might want to re-think going
into real estate sales. The stress level in the business is always pretty high
and adding money worries is almost always a recipe for personal disaster.
That's the bad news. The good news
is that if you work very hard and very smart for thirty days you have an excellent
chance to bring home a commission from one transaction that is greater than
a whole month's pay at the odious, etc. job you quit. To quote Coach Lombardi
again, the only place where success comes before work is in the dictionary.
I think I can!
If you find that you can afford to
attempt a real estate sales career you might just find the life you've always
dreamed of. No, you can't actually make your own hours unless you stumble on
the only clientele in the history of the world who value your time above theirs,
but someday you may be able to hire an assistant (or several) to work some of
the hours (and clients) you'd rather not. With a plan all things are possible.
by Carmel Streater
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