The F word…. Financials…. Can be a wonderful conversation or you may completely avoid the topic. At the end of the day your real estate financials in how you run your business will decide if you have a business. This week I have been looking over my numbers and they are no fun. Taxes, signs, business cards, photos, ads, dues, rent, marketing software, accounting software, different shiny programs, lunches, cards, mailings etc etc etc… Running your business without a budget is a rough idea. I was speaking with an agent today about getting them started and the ideas they had would have made a mega agent flinch. Radio, tv, internet ads and so on in order to build that business pipeline. The biggest problem? No business coming in to pay for that stuff yet. You typically aren’t coming into real estate with a large sum of money to throw at marketing, if you are do yourself a favor and toss it somewhere that it will grow and build your business right.
What does right mean? It can mean a lot of things to a lot of people. If you have a bunch of money because you sold your last business and it’s burning a hole in your pocket fine use it to pay for a coach, your dialer, mailings to YOUR DATABASE ONLY and see how that works for you. To me building your business right is leading with your revenue. What does that mean? Well it means don’t spend money you don’t have. Don’t take a loan out or get a credit card for this stuff because it’s gonna eat your profits and the goal here is to be in the black all the time. How do you get started with no money though? Well have you been living under a rock? If so this isn’t going to be easy and pay attention because you need to get out from under the rock. Your database is your first 6 months of income. Then grow your database and it will provide you income for life. Every 10 – 15 people should be a deal, if you have 150 people you should do 10 deals conservatively. Simple right? After you start consistently prospecting your database look at moving into other arenas but don’t start advertising on a credit card because zillow promised you some exclusive area! Guess what? Zillow is a business! They want to make money and at the end of the day when you fail to convert the few leads you get and waste your time showing them houses without qualifying them and getting them under contract you will stop paying for zillow and they will go on to the next sucker who doesn’t know any better. Work your database! When money allows you go then and get a expired/fsbo lead service and dialer. This is where it gets fun. You start making money from this method and you aren’t spending thousands of dollars on your ads! Your dialer and leads should cost you roughly $175-$300 a month. When you sell 1 listing from that each month (I did more than that by myself it can easily be done) you will be very happy with your decision.
So what next? You’re making money from your database and expireds/fsbos, the next step and the step you need to be doing throughout the process is grow your database. Finally get a coach! coaches are amazing when you have a good one. But wait wait what about radio and tv and internet marketing and my website blah blah blah…. it’s not that these things don’t matter, it’s just not how you get started. When you are at a point you are making good money, whatever that means to you, and have leftover cash in the budget for new ventures start testing different things one at a time and hold every dollar accountable to bring back more dollars.
You need to make money in this business or it’s not much fun. Keep your expenses low, your phone to your ear and your credit cards at home.