“If you cannot measure it, you cannot improve it.” This quote by Lord Kelvin is vital to your successful real estate business. When you approach your business as a business and know your personal statistics, then you can have control over your income and make sure that your business is ALL treats and no tricks! My friend Michael “Stats” Wallin works with the Atlanta Falcons and motivates them through the use of each player’s personal statistics to enhance their performance on the field. Knowing your stats can enhance your effectiveness as well!
What is your primary source of business: Buyers or Sellers? What is your primary lead source for each of these groups? When you know this information then you’ll know where to effectively spend your marketing dollars.
What is your sale price to list price ratio – this figure tells you how skilled you are at CMA’s and pricing property. What are you average days on market? This number will hint at your persuasion skills in getting price reductions if the property is not priced appropriately when listing. Do you know how many contacts you must make before scheduling an appointment or how many appointments you attend before getting signed contracts? If this ratio is high, then you know you need to work on your presentation skills. How many contacts must you make prior to scheduling an appointment – this number let’s you know if you need to work on your skills – scripts & objection handlers – to actually set an appointment. How many people do you reach out to before having a conversation? This figure let’s you know if you are prospecting an effective lead source or not. What is your average commission earned? How many hours do you spend generating new business? What percent of your business is “stranger” business or referral business?
Once you track these figures and truly know your stats, then you can effortlessly know EXACTLY what you need to do, whom you need to contact, how much you earn per hour, how many people you need to contact, how many hours per day and days per year you need to work to earn a specific income. This type of tracking allows you to have a predictable business. You will soon learn that you need to spend ____ hours per day to speak to ____ number of prospects to schedule ____ number of appointments to take _____ number of listings to sell ______ number of properties to close in ______ number of days and earn _____ amount of income. No more leaving te balance in your bank account up to chance!
Then you can work those figures backwards: If you want to make an income this year of $___________ then you must spend ____ hours each day generating business and work ____ number of days that year! This amount of income you make is totally under your control once you spend some time tracking and understanding your numbers!
Below are some forms to help you with this tracking so that you may organize your business and totally relish the treats of real estate and not have any surprises or “tricks” at the end of each year!