7 Ways to Leverage Your Real Estate Earnings By Brandon Patrick
“Richer is the man earning 1% of the efforts of a 100 men than 100% of his own efforts.”
—J. Paul Getty
It really doesn’t matter where you find yourself today—doing 3 deals a year or 200—if you are the sole catalyst for your production, if it is primarily your efforts creating whatever level of business you’re currently enjoying… you are working IN your business and, eventually, are doomed to either peak out or, worse, burn out.
The problem is, there are only 24 hours in a day. And if you are trading your time for dollars… which you are doing when you work IN your business versus ON your business… you have placed a serious limitation upon your earning capacity.
Not to mention the fact that to earn it (whatever it is), you will often find yourself working sixty, seventy, even eighty hours per week. And, you can’t take time off! If you do… your production, your business suffers. Your income suffers. Your lifestyle suffers.
If such is the case, I can assure you… career burnout is just around the corner. It took me five years of working IN my business (five years of being bored, beat-up and broke!) to finally realize that the “rewards” simply weren’t worth all the time, hassle, and expense of creating them. I mean, what good is being a multi million dollar producer and pocketing a few thousand bucks when you don’t have a life apart from the business to enjoy it?
Key distinction: Leverage allows you to multiply your efforts, time, and energy which means multiplied income and time to enjoy it.
Ideally, your goal is to convert your existing business—or the one you are about to create—into a perfectly organized model for thousands more just like it. In other words, the most profitable way to view and build your business is with the creation of a “franchise” in mind. And that means you either have to have a thousand yous available to work in each and every one of those businesses… or discover a way to “clone” your work and have this clone (your systems) keep on working for you… even while you’re out playing life somewhere.
Of course, this is the ideal situation, albeit a difficult one to achieve. So while you’re striving towards that end… focus on leveraging yourself…
Leverage is utilizing assets (people, time, money, connections, systems, knowledge, family, strategic alliances) to get the maximum return, results, and rewards with the minimum risk, effort or investment.
Becoming a listing agent is a classic example of the power of multiplying yourself and your efforts through leverage.
You build an inventory listing by listing. No leverage there. However, any one (or all!) of those listings can be sold—and income generated—for you and your business… totally independent of your efforts. That’s leverage.
Proper leveraging doesn’t mean you spend hours knocking on every door within a housing complex to introduce yourself and your services… it means you spend a few minutes contacting the Home Owners Association and arranging to give a free speech at their next meeting… sharing your benefit-rich wealth of knowledge with dozens, even hundreds of potential prospects all at once.
Instead of doing everything yourself or hiring just one assistant to take up the slack, proper leveraging means hiring specific people to perform specific tasks and then constantly upgrading… just like a professional sports team.
Smart leveraging means writing any letter or communication once, maintaining it in an electronic data base, and simply merging your next client’s name and address into the copy the next time the same situation arises.
Leveraging your marketing capital means placing your name, face, and benefit-rich message at every ingress and egress of a targeted neighborhood via inexpensive bus bench advertising—reaching hundreds, even thousands of the right people every single day, 365 days of the year… versus spending the same money on 2,500 super expensive 4-color personal brochures which can only serve you but once…
Proper leveraging means you receive one inbound call from a potential buyer… record your qualifying sequence of questions… transcribe the recording… and have all other inbound calls received by your assistant who follows your documented qualifying sequence. Your time is thus freed to work ON your business so you can then find even more leveraging opportunities.
Instead of purchasing one large congratulatory gift for your happily involved clients… the smart marketer leverages goodwill by purchasing a half dozen smaller, but uniquely personal gifts which are delivered once a month… ensuring their name, face, and occupation is kept in front of their past clients. We will get into this topic when I discuss my Touch50 campaign in Send Out Cards!
Proper leveraging means you make your best sales, pricing, and “here’s what I and my team of specialists will do to get your home sold… fast, and with the least amount of hassle” presentation once… on DVD and/or written down and published in a brief, informative yet entertaining manual… and distribute it to every prospect before your appointments. You let your “clone” do all the selling, convincing, reasoning, and cajoling for you before you even arrive—not only cutting your actual, in-person presentations down to less than 30 minutes, but increasing your “closing” percentages as well…
Effective leveraging means using both sides of your house brochures… one side to extol the virtues of the particular house in question… the other to list every single one of your listings… to make an incredible FREE offer compelling them to pick up the phone or stop by your office to take advantage of it… to offer a series of testimonials from a number of your previous clients…
Let’s take a look seven specific areas you need to address to create maximum leverage of both your time and your income:
1. Computerize
With any luck you already have a personal computer or laptop (even better….a Tablet PC!) and know how to use it. If not, may I suggest you get with the program…
Properly used, a computer will provide you will a multitude of opportunities to leverage your time and assets. You will discover a number of ways you can reach more people faster, more economically, and with less hesitation about what to do and when. Specifically, a computer is of the utmost importance for the following reasons:
· It stores information
· It sorts information
· It performs routine tasks automatically
· It enables you to personalize your marketing materials and emphasizes your client-centered, benefit-rich approach to the business.
Your computer, ideally, should be able to assist you in the following essential tasks of your real estate business:
· Design your marketing campaigns
· Develop your own education products (free reports, etc.)
· Help you acquire already created products from others
· Actually do your marketing for you (i.e., BAP)
· Provide routine management services (escrow tracking, price reduction campaigns, seller updates, buyer updates)
Your computer should be equipped with a good contact management system like Busy Agent Pro (an internet based program which you have as a BAP member! ) to track all your leads, clients and referrals. It should include a “to-do” list function and a calendar, scheduling function. It should have a good word processor integrated with your contact management system. And it should have a good “marketing oriented” system. A tracking function, spread-sheet program.
2. Plan and strategize
Your time is valuable and you should make it a point to take the time to plan how best to use your available time. Take at least a half hour at the end of every day to plan your next day. Prioritize. How? Ask yourself this these questions:
· What MUST I accomplish tomorrow?
· What SHOULD I accomplish tomorrow?
· What is the most important thing I can do tomorrow?
Schedule the ‘musts’ first. Then schedule the ‘most important things’ next. And if, if, you have time left… go forward with your shoulds.
Now don’t gloss over this section. Marketing, after all, is only comprised of two components: planning and execution. Too many would be marketers, in their haste to get something done, completely by-pass the planning stage and… chances are… get so caught up “working for the sake of work” they get nothing valuable done. Don’t fall victim to this tragic error. Plan your work then work your plan.
3. Make marketing your highest of priorities
You don’t make any money by prospecting. You don’t earn a single commission from filling out contracts. You don’t earn a dime from understanding agency rules and regulations. And you certainly don’t earn a dime from by sitting at your desk wondering where your next commission check is going to come from.
You only make money when you put yourself in a position to make money… when you’ve created the situation wherein you find yourself face-to-face with a buyer or seller who is willing and able to conduct business with you now!
That’s it. So if you want to leverage your time and assets to best propel you towards the fortune you want and deserve, you need to focus first and foremost of marketing. All facets: Lead generation, Conversion, Presentations, Materials, Follow up sequences, fulfillment, education and referral generation.
First and foremost, concentrate in developing an automatic lead-generation system which works consistently and predicable.
· Study targeted, emotional response marketing
· Learn how to use the classifieds for lead generation
· Combine image and response ads for display advertising
· Learn how to use free publicity
· Learn how to generate referrals
· Locate and utilize areas of marketing which are constant (i.e., bus benches, airport signs, billboards, signs in public restrooms, etc.)
4. Hire assistants
Again, let me ask you: Do you make any money for addressing postcards and affixing stamps to be delivered to your “Just-Listed” file of neighbors? Do you get paid for holding an open-house? Do you get paid for assembling all the information you need to deliver a solid, benefit-laden pre-sell package to either buyer or seller? Do you get paid to track your escrows? Write follow up letters to your clients?
No. So why are you doing all this “busy work” which only serves to eat up your time? Why are you still making cold calls to expires when you could hire someone else to do the same thing for about $8 an hour?
Point made, I hope. Your time is far too valuable to be wasted in carrying out the systems you’ve designed to make your business work. Simply train people to work the systems. In fact, as quiet as it’s kept, you cannot afford to be without assistants or professional affiliates to help you complete the busy work of your business.
5. Understand communications technology and use it
Email, call capture systems, text messaging, fax machines, web sites, cell phones, voice-mail….the list goes on and on. Modern technology at its finest. And perfect devices you can use to leverage your time and income. For example, we use call capture systems to:
· Generate leads for both buyers and sellers
· Answer all calls from these lead sources
· Deliver an educational and benefit laden message to all callers
· Soft qualifies all callers
· Answers the same questions asked by most callers
· Guides callers into the next step in the marketing sequence
· Requests and records callers name, address and phone number
· Requests caller to make a direct call into the office
We also use call capture systems to:
· Provide an audio brochure of our listing inventory (like Adtrakker)
· Provide a “seller’s update” service eliminating the need for personal calls
· Provide a “FSBO Helpline” which educates and helps generate leads
We use email and faxes to request lender information, property specs, and referrals. We use cell phones to make calls while on the road. We use text to as “announcement” devices letting us know when our internet site has received a response, when an ad has been called upon, and when a potential buyer has called on a property ad.
Use modern communications technology to leverage your time and efforts. Take a look at what’s available and think about how you could best use it. And, I promise you, you’ll be amazed and what you can get done… easier, faster, and with less headache and hassle.
6. Develop a local top-producer network
One agent I know absolutely refuses to work with sellers. Another absolutely refuses to work with buyers. I’ve asked both what they do with their “unwanted” leads and referrals. Their answers: “Nothing.”
Oh, gee… that’s a brilliant, money-making answer! One thing’s for sure… it’s your ticket to leveraging your time, money and income potential. For example, one small-town California agent I know uses her top-producer network to generate over $500,000 a year in extra commissions by simply referring all her soon to be expired listings out to her competition. By giving them permission to solicit these soon to be expireds… chances are very good they will be relisted and sold. When they are, she gets paid a 25-30% referral fee. Money she would not have seen otherwise! In return, she too takes listings which were referred to her, earning 70-75% of her normal commission which she gets with very little (if any) competition!
Set up an internet feedback system to gain valuable feedback concerning your listings.
Set up new “listing announcement” system. Either email or have delivered all of your new listings to your top producer network. Have them do likewise.
Expand your network globally. Get yourself listed on numerous “referral” programs.
Develop a network of “non-competitive” professionals and meet with them once a week or so for the sole-purpose of lead generation. You get leads for moving companies and you give them away. They get leads for your services and they give them to you. What a deal!
7. Think systems
“Go to work ON your business rather than IN it,
and ask yourself the following questions:
1. How can I get my business to work, but without me?
2. How can I get my people to work, but without my constant interference?
3. How can I systematize my business in such a way that it could be replicated 5,000 times, so the 5,000th unit would run as smoothly as the first?
4. How can I own the business, and still be free of it?
5. How can I spend my time doing the work I love to do, rather than the work I have to do?”
—Michael E. Gerber in his book, The E Myth.
Real Estate. It’s the career you love to hate.
You love the money and freedom real estate represents. But you know what?
Statistically you are doomed to fail. And you know it.
That’s why you have a love/hate relationship with the industry. You love the opportunity real estate represents, but you hate the thought of potential failure. The thought that it might all come to an end someday; the phone will stop ringing; your calls will stop being received; the market will take a nose dive right into the toilet…
When you chose real estate as your means to financial success… you set the stage for a play wherein there are only two roles—Heel or Hero.
The attrition rate in the real estate industry is even worse! Statistics tell us that if 60 individuals apply to take a prelicensing course, only 50 will complete the course. 32 will pass the exam on their first attempt. 25 will sign up with a local broker.
Of the 25 who enter the business, most will earn less than $20,000 a year. One will make over $50,000 their first year.
Five years from licensure, only 2 or 3 will still be in the business. Now, let’s see. By my count, that’s 57 “heels” for every 3 “heroes.”
Now I don’t quote the stats to discourage you, but rather to introduce a key distinction you must make if you ever hope to make it big in this business…
You need to create and maintain the mind set you are in business.
Successful real estate professionals are not hobbyists. They have not embraced a career, or a part-time venture. They have decided to go into business, and they engineer their day-to-day activities in such a way as to work ON their businesses versus IN their businesses. And that is the key to their success.
Most agents and brokers (remember… most will fail or, at best, produce mediocre results year after year after year) arise every morning in search of the “deal”. They spend their time seeking out new prospects, do their best to secure that business, finalize the sale… and go on to the next sale, the next deal. In other words, they spend the majority of their time working in their businesses!
They do all the prospecting. They place their own ads. Conduct their own open houses, complete their own paperwork, receive all calls, do all their own qualifying, interviewing, driving, showing, picture taking, sign placements, mls postings, mailings, and escrow closings. They do it all. And they’re good at it. They’ve mastered in the fundamentals, the nuts and bolts of the business… and, most will fail. Miserably.
The successful real estate professional, on the other hand, wakes up in the morning and goes about the business of creating a business. A big business. The “deal” is just one element of many—and not necessarily the most important.
The goal isn’t to secure a new deal… the goal is to create an enterprise, an equity-based business that can 1) run profitably independent of your efforts, 2) provide the means of an early retirement if that is what you want—a perpetual money machine, or 3) a salable business.
The successful real estate professional may work in their business when necessary, but their primary emphasis is working on their businesses—on the creation of viable, hugely profitable enterprise.
Key Distinction: Your business in not your life.
Your real estate career, your business, if you want it to succeed in a huge way… at its best, should be viewed as distinctly apart from you. Your business and your life are two totally separate things.
You, as an individual, will live and die according to how well you maintain your health, avoid accidents and disease. Your lifestyle will be determined by how much income you generate and how much free time you have available to enjoy the benefits of your income.
Your business will live and die according to how well it performs its one and only function: to find, satisfy, and keep customers. Your life is not our business. You do not live to serve your business; your business lives to serve your life. You have to make this key distinction, this “separation” if you ever hope to propel your business beyond your capabilities.
So, just how do you go about working ON your business versus working IN your business? How are you going to create systems… the ultimate in leverage?
Imagine you are given the assignment to create a hugely profitable real estate franchise. A turn-key operation. In other words, your task is to create a business that not only works, but is also 100% duplicable by anybody. An “out-of-the box” salable business. Plug it in and it works.
Not sometimes. Always. Without fail.
And remember… you won’t be there to run the show! You won’t be there to do all the work! The business model you create must be 100% duplicable… without your interference in any way, shape, or form.
Here are some more “rules” you should need to follow as you create your winning, duplicable business:
1. Your business model will provide consistent value to everyone directly or indirectly touched by it, its products and/or services. Your goal is not to provide outstanding service but, rather, ASTOUNDING service.
2. Your business will operate efficiently and effectively by people with the lowest level of skill and monetary requirements. Your $15-an-hour office manager should not be employed in an $8-an-hour telemarketing job. Likewise, if your $8-an-hour telemarketing personnel is capable of reproducing a press release, stuffing a few envelopes and mailing… why on earth would you even consider hiring super expensive PR agency to do the same thing?
3. Your business will be organized to the hilt. Sloppy habits make for a sloppily run business. There is not order to be found within the chaos as far as your duplicable business is concerned.
4. Every job, duty, and operating procedure will be formally documented in an Operations Manual. Remember your primary goal is to create a duplicable, “out-of-the-box” business. Everything must be organized, systemized, and documented so anyone who can read and follow simple instructions and do what you’ve determined needs to be done.
5. Your successful business will provide consistent, predicable results. Not sometimes. Not just when the market is good. Always. No excuses.
Leverage yourself. Think systems. Think how you can “sell in bunches.”
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