The Real Estate Encyclopedia
Solutions For REALTORS® in a Slowing Market
Category - Real Estate Information Sources - Real Estate Articles

As 2006 begins to wind down, you may be reviewing your sales and transactions numbers and feel a little dissatisfied. Could you have done better? More transactions, more revenue? Although there is still time to boost your numbers before 2007 rolls around, what's even more important is that you begin thinking about what you're going to do next year to reach the numbers you're truly capable of. What's that...you're not sure where to start? Smart agents know that the best way to review their year's business and plan for next year is to have a business plan. For example, when you look back on this year, how do you know what marketing activities worked and which ones didn't? How are you going to calculate the impact on profitability of the marketing decisions you made? Basically, how are you going to be able to know what needs to change?

The process of putting together a business plan requires you to: focus, clarify, define and be accountable. A well-designed business plan allows you to change assumptions (marketing strategies) back and forth, and then to project the impact they will have on your business. Most importantly, a well-designed business plan supplies you with a doable plan of action.

"Focus" is the first part and that's all about seeing the big picture. Ask yourself what revenue you need to generate from your real estate business to cover your living and lifestyle needs? To do this you should first create a personal budget identifying what your annual income needs will be for 2007. Inside your business plan this personal budget becomes the focus of your business. As simple as it sounds, real estate is still a business and you need to make sure that your business will generate enough revenue to cover all your business expenses as well as your living and lifestyle needs.

"Clarifying" your Focus comes next – it's fairly simple. Determine how many transactions you need to close to pay all your business expenses and your living and lifestyle needs. You want to be able to clearly state your business plan for 2007 as simply as saying; "I need to close this many transactions to meet my income goal."

"Defining" your business follows Clarifying. Once you have the "Focus" of your business (your income) and you have Clarified that Focus (determined the required number of closed transactions), then you need to "Define" how you are going to accomplish your goal. Ask yourself what are the sources of business? List where you want to generate business in 2007 and then determine the amount of effort it will take to get business from those areas. For example: You plan to work "expired listings" and you estimate that you will need to contact 30 expired listings in order to get one appointment, and that for every three appointments you will get one Listing Agreement. The simple math dictates that you need to contact 90 expired listings to get one potential closed transaction. Then ask the question - is this reasonable in your market area?

To properly define your business, you should go through the above process for every source that you think will produce business for you in 2007. This will give you a To-Do list for your business, which is essentially a business plan.

"Accountability" is the last part of creating your business plan. How do you make sure that you are doing what you should be doing each and every week? We spend so much time in this business putting out fires that we often fail to continue to do the activities that produced us the leads in the first place. Your business plan should provide a method of reminding you of the weekly activities you defined as being necessary to meet your income goal. As you track your activities, you will develop knowledge of what activities really work, given your current market conditions, as well as those that don't.

A well-designed business plan will allow you the flexibility to make changes throughout the year and update your required weekly activities. Think about this logically. Why put effort into activities that do not produce optimal results?

Finally, you cannot do this on the back of a napkin; it will require a little technology. CreateAPlan is a business-planning tool that addresses all of the above-mentioned requirements, plus it is rich with other features that will help you analyze your business and point you in the right direction. Currently CreateAPlan is offering the balance of 2006 absolutely free, with your paid subscription for 2007. To get yours simply visit CreateAPlan.com today and sign up; no special discount codes needed, your discount will automatically be applied. Don't delay, start now to make 2007 your banner year.





References


External Links
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Real Estate Information Sources - Real Estate Articles
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