A love-hate guide to profitability

Part 2: Blueprint for 2010 success

February 11, 2012 05:59 AM

By Bernice Ross
Inman News®

Editor's note: This is Part 2 of a two-part series. Read Part 1 here.

Did you have a business plan for 2009 or are you like the 90 percent of all business owners who operated without a plan? If you want to have your best year ever in 2010, a solid business plan is the foundation upon which success is built.

Part 1 of this series examined how to identify your personal best practices. The next step is to create your business plan.

Research has consistently shown that achieving goals is tied to having a written business plan. While you may not always need a map to reach your destination, having a map keeps you on course.

When most people write a business plan, they generally focus on making their numbers. Looking at the number of calls you're supposed to make or the number of transactions you hope to close isn't particularly motivating for your brain. To be more successful in 2010, you must also address the human side of the real estate business -- how your beliefs, attitudes and feelings either support or undermine your success.

To create a business plan that addresses both your business and personal needs, follow the guidelines below.

1. Set up your evaluation matrix
Begin by dividing a sheet of paper into four separate parts and label each corner: "Love to do and profitable" (upper left corner); "Hate to do and profitable" (upper right corner); "Love to do and not profitable" (lower left corner); and "Hate to do and not profitable" (lower right corner).

2. Identify your personal best
List all of the transactions that you closed in the last 12 months. Next to each transaction, note where the lead originated. (This could be working with expired listings, short sales, relocation buyers, geographical farming, open house, Web prospecting, etc.) Of those areas, identify the top 50 percent that were the most profitable to you in 2009.

Now sort these activities into two more groups: "love to do and profitable" and "hate to do and profitable." Place the "love to do and profitable" in the upper left-hand corner of your matrix. These are the primary areas upon which you should build your business in 2010. The key to success is to focus on doing what you love. Don't waste your time trying to do what you don't do well.

3. It's no fun, but it makes money
Place the remaining activities from your top 50 percent most profitable in the top right-hand corner ("hate to do and profitable"). Consider delegating these activities.

For example, if you hate working with buyers, form a partnership with someone who loves working with buyers. If you hate paperwork, hire a transaction coordinator. By focusing on your strengths and delegating your weaknesses, not only will you be more profitable, you will provide better service to your clients as well.

4. Eliminate what is not profitable
The hardest quadrant in this model to cope with is "love to do and not profitable." As you look at the activities that resulted in closed business, notice what you're doing that did not generate any business.

For example, are you still mailing to an area where you obtained no listings during the last 12 months? Have you regularly held open houses and generated no closed transactions from that activity? If an activity has not produced a profit for you, it's wise to stop doing it. The easiest place to start is with the "hate to do and not profitable."

In 2010, devote the time, money and energy you spent on unprofitable activities in 2009 to those areas that were profitable.

5. Set your income and closed transaction goals
Assume you closed 20 transactions in 2009. If you double the amount of time that you put into your most profitable real estate activities (i.e., by eliminating what is not profitable), most agents easily increase their closed transactions by 50 percent or more.

6. Use the 3-2-1 approach on a daily basis
Once you have created your business plan, ask the following questions at the beginning of each day:

• What are the three business activities I absolutely must complete today? Complete these first before doing anything else.
• What two self-care activities will I choose today to keep me balanced mentally, spiritually, emotionally and physically?
• What is one activity I can complete today that will help me have business tomorrow?

The challenge for most Realtors is that they allow less important activities to intrude on their "top three" priority items. Treat these appointments for self-care and creating new business with the same priority you would attach to a listing appointment.

7. Use the "4-3-2-1" approach each month
Schedule at least four days off each month; at least three nights each week where you have dinner with either family or loved ones; two days per month where you spend a full day with friends and/or family; and at least one day completely for you where you play golf, get a massage, or do whatever you need to do to recharge.

8. Track your progress
Experiment with this approach for one month and then evaluate your progress. If your sales are increasing, stay the course. If not, look at what could be altered to improve your sales.

9. The real secret of success
Review your business plan, including your income and transaction goals, at least twice a day. Keeping your goals in front of you constantly is the secret to achieving them. Envision yourself fulfilling your goals and watch your business soar like never before.

Bernice Ross, CEO of RealEstateCoach.com, is a national speaker, trainer and author of "Real Estate Dough: Your Recipe for Real Estate Success" and other books. You can reach her at Bernice@RealEstateCoach.com and find her on Twitter: @bross.

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