Getting A Grip On Your Real Estate Business Operations
Updated: Mar 1, 2022
REALTORS® are some of the best salespeople in the world, but when it comes to managing day-to-day activities many experienced team leaders and brokers admit they could do better. The good news is, getting a grip on your business operations doesn't have to be hard.
On this episode of the Agent Exit Podcast, host Renee Williams explains her operations model. With these six (6) foundational pillars you can improve your business operations and increase profits in less time than you might think. Renee discusses several topics including the time saving benefits of automating your CRM accountability, and the team saving benefits of removing toxic people. If you’re looking for great tips and resources to improve your operations, this is the episode for you.
Mentioned on this episode:
Transactly - Transaction Coordinators on Demand
Followup Boss - CRM for Real Estate Teams
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Getting A Grip On Your Real Estate Business Operations
We're going to talk about a couple of different things that are related to your business, body and mind. Those were the three items that I want to cover. Those are three legs of the stool that is the Renee Williams Group. I thought we'd touch on each of those so that you understand not only who I am but also some things about your business that you may not have considered previously. A little bit about purpose. First, let's talk about your business. Your business should have six pillars. The six pillars are your purpose, processes, production, plan, people and profits.
Your Vision And Values
I'd like to talk about the mission, vision and values. I get that from a book called Traction by Gino Wickman. Traction talks all about having a vision for your business that's not a secret. Everybody on your team should know what your business is about, who are you and what you stand for. What is it that you guys do? What you're good at? What do you want to be known for?
The vision is long-range. The idea behind the vision is that it should have eight different parts to it. I'm not going to go through all eight of those. Check out Traction by Gino Wickman if you want to know what the eight parts are for that vision. I do want to talk about the fact that you must have a vision. I have this quote in my head about the people perishing for lack of knowledge and vision. Your business will perish if you do not have a vision.
Everyone must be on board and moving in the same direction in order for your business to be successful. As far as the values and the mission are concerned, what are you about? Have you established that? Do you live by those or do you have value creep? You started with these great values or this great mission, and you're starting to creep away from what it is that you initially started with. If you start your business more than fifteen years ago, you definitely need to revisit your purpose.
Your purpose is your mission, vision and values. Remember that. They must be established and you have to stick to them. For your team and clients, they establish who you are in the marketplace, at home, in your business or in your office. Those values, mission and vision should be the same all the time. That way, you have a standard for your team to meet as far as the culture is concerned. If one of your values is excellence, then that's what we do. We are speed to lead people. That's what we do. We follow leads with excellence because that is who we are. If we have a client who is expecting something from us, we are excellent with our clients. We don't show up halfway. We show up all the way with our clients. All of that falls under your purpose, the purpose of your business. Why are you here? What do you do? Who do you do it for? How do you do it? That is your mission, vision and values.
You will make more money if your time is more focused on dollar productive activities.
Operating Procedures And You
Next under business, let's talk about processes. Do you have SOP or Standard Operating Procedures already mapped out? A little secret for you or a little tip, Google Drive or Dropbox work wonders. Google Drive is free depending on the size or how much space you need, or you can use Dropbox. There's also SharePoint or ShareFile with Microsoft. Whatever you use, you should have standard operating procedures posted or a file uploaded by the person who was responsible for doing that particular item.
If you have a transaction coordinator, that transaction coordinator should have a specific way in which he or she does your business every single time you have a transaction. They should be able to upload their process or their procedure for every single transaction. Every time you have a listing, this is the way we do those as far as the transaction coordinator is concerned. Once we get sold, this is what we do. If we're representing a buyer, every time we write a contract and it's accepted, this is what we do. The transaction coordinators should have that.
Do you have a person who is responsible for before you get a contract when you first get a listing? Do you have a listing liaison or a listing admin who manages how we put signs out? How do we get questions answered about the property from the buyer? How do we get our listing agreements done? All of those things should be put into your standard operating procedures folder by the person who is responsible for conducting that particular item.
If everyone is in the shared folder, they're able to drop items in there. You can limit who can see each folder. You can limit who can make changes to the documents. Some of those documents you can view but can't edit. You can make those choices. You should definitely have an admin or a director of operations who is responsible for overseeing the SOP file. That should not be something that you are doing. There should be somebody on your team who's responsible for making sure items go in there, that they're kept current and updated.
The next thing under process is your systems and automation. What do you have that you're doing manually that you could be automating? Let's talk CRMs. My favorite and I know that I am partial because this is the one that I've used the longest. My favorite CRM is Follow Up Boss. I love it because of the automation. Automatic text messages go out. It is so quick to lead. It gives me a Round Robin. When I'm working as DO for a team, if they don't have a good CRM, I'm going with Follow Up Boss every time because of the amount of control that I have over what is going on in my business.
I can see who, when and if they called. All of that information is so important for the automation of your business and it spits out reports. You should have specific systems in place for everything from ordering office supplies to managing your VAs or virtual assistants. Those are all things that you can put into systems, your email campaigns or event planning for client events. Those are all things that can be automated and put into systems and then assigned to the admin on your team to run the systems. You are the agent. You should not be running those systems yourself as a team leader, a broker or an agent. If you hired well, there should be an administrative person on your team who should be much better than you at running all of those things.
Let’s Talk Production
The next under business, let's talk about production. Production is lead generation, your niche or specialization and production model. If you do not have a transaction coordinator, you need one. You've got to get one. If you do not have a virtual administrative assistant, you need one. Get one. The reason why I'm suggesting these things is because your best time or your dollar-productive time is spent when you are getting listings and getting contracts done.
Do not spend money on lead generation or purchasing leads where nothing comes in.
Once they are done and even before the marketing piece, your admin can help with the marketing piece. You fall in the middle with getting the actual listing under contract agreement done, and then you hand it off to your TC. Even in the middle, you've got somebody that can help you once you got a listing agreement. You should have team members helping you. You will make more money if your time is more focused on dollar-productive activities.
I know that sounds so hard for some of you. Even for some of you who are team leaders, your team is doing well. Your team members, buyer's agents and listing agents are doing well and doing some things. As the rainmaker, you are still trying to do so many things on your own. Why? Get a TC on your team for $200 or $300 per transaction. There is even a website that you can go to now to get transaction coordinators. They are like an Upwork or an Uber of transaction coordinators. The name of the company escapes me but I will find it, and I will make sure that you have it for transaction coordinators per transaction. You don't have to keep them on your team. You have to have someone who is able to handle that specific transaction when you get to it.
The next thing that I wanted to talk about under production is lead generation. Are you buying leads? If so, are you getting a solid ROI? Have you looked at your return on that investment? Look at the ROI. How much are you spending a month on leads and how many actual closed transactions do you have from the leads that you are purchasing? If those numbers don't make sense, then please put that money somewhere else. It's all about speed to leads that you're purchasing. If you can't reply to a lead within 2 or 3 minutes, you or someone on your team needs to reply to those leads. If you can't, then you are flushing money down the drain. That's number one with lead generation.
Number two with lead generation, are the leads that you're getting any good? If you're getting leads that are coming in and they are absolute garbage, is that worth your money? Do not spend money on lead generation or purchasing leads where nothing is coming in. It also means that sometimes you need to look carefully. I know we have big hearts for Little League teams, school calendars for local schools and other things, but are you getting any business from those? If you want to make a donation to the school, make a donation of some sort. If you want to purchase something for your child's teachers or something, do that, but wasting money is not a good use of company dollars. Let's not spend money on leads that are not giving us anything.
Back to the production model, I wanted to also mention inside sales agents. If you do not have an inside sales agent, consider it. Inside sales agents work on commission. You can often start with a straight commission like 100% commission. You can do a very low salary or a low hourly plus commission as an incentive for them to get transactions across the finish line or at least to get showing appointments done, then let your listing agent get those across the finish line for you
Be thoughtful about whether or not you want to bring in ISAs. They're working a full workday, eight hours a day, five days a week to either calling back your leads or they're dedicated to cold calling new leads for you or following up on your social media hits or whatever it is that you want to have them do. There are several programs out there for ISAs, like how you should structure their day and what they should be working on.
Those are all items that are available. Have your admin look them up for you. If you are considering going with an ISA, have your admin do some research and see what she can find. I'm telling you, Ladies, it is there. I will tell you to go to TLG Shares. That's The Loken Group. They are here in Houston. They're the number one KW non-expansion team in the world. The Loken Group provides job descriptions. They share all of the things that they do for their ISAs for free at TLGShares.com. I will have an episode from them here on the show. I interviewed Alana Badeaux with The Loken Group. She mentioned there that the descriptions are available on that website for inside sales agents and for all of the positions that they have with The Loken Group. She has them there.
The next thing under production I wanted to talk about is niching down or having a specialization. I'm not going to stay on this long but if you were floundering or plateauing in your business, consider having a niche. Either a neighborhood like a location, an area or a type of client like military, seniors, police officers, government employees, teachers. Find a niche, a neighborhood, not an entire city.
I'm in a suburb of Houston. That's my niche. That's four million people. If you want your niche, pick a neighborhood. I know agents who have done neighborhoods. Here in Texas, we have neighborhoods that have developments of over 2,000 or more homes in one subdivision become the goddess of that neighborhood. They should see your signs everywhere in their neighborhood.
If you own an area, then it becomes much easier for you to get referrals to see multiple signs in a row. If you are very popular in a specific neighborhood and you target and retarget that neighborhood, you can easily get a shot of your sign in three different yards, depending on how your listings are selling. That is powerful. If you're doing postcards or direct mailers, it's so much easier if you have a specific location or a specific ZIP code that you're working in. Please consider that as part of your production piece, niching down or specializing with the group. If you have not done that yet, going back to putting rocket fuel in your tank between ISAs, transaction coordinators and niching down to a neighborhood, I've seen businesses take off with phenomenal growth with those simple tweaks to their business.
We want a business where people are thriving and proud to work with you and proud to be on your team.
Look At Your Business Plan
Next under business is a plan. Do you have an exit strategy? What's your plan? What are you going to do in the next 3, 5 years? If you are already at my age, many years from now, I may or may not want to continue to work with clients, but I'd like to have the choice. If you don't have a plan, you definitely need to be considering your exit strategy, passive income streams, or some playbook that you're going by to figure out what you're going to do next.
If you have not read Emily Guy Birken’s episode, go back to episode number 4. Don't hold me to that. Look for the one that says, “The 5 Years Before You Retire with Emily Guy Birken.” Emily is talking about all of the things you need to have in place money-wise before you retire. Those are all things that you should be considering in your plan for your exit strategy. What's your succession plan? What are you going to do with your business when you decide to step out of production?
Are you going to continue with referrals? Are you going to keep your license active? Are you going to go completely off the grid? You and your significant other are going to move to some beautiful island somewhere. You're never going to practice again. You're going to live off all the passive income you have coming in. If that's the plan, let's write it down and have a plan. Write down what you want the vision to be. Not what you think it can be like, “Right now, I could see Bob taken over and my daughter running this.” Write down what you want to happen and then let's talk about what steps we need to take working backward on getting to that goal. Maybe it's a matter of getting your finances organized so that you can have that exit strategy. It may be easier than you think if you write it down and then get some help with the actual strategic plan.
Your Business And Your People
Next, let's talk about people. In your business, you have team members. You may have staff and employees. You may have family members who work with you. We should be thinking about leadership. We should be thinking about team success like, is my team doing well? The people who are on my team who work with me and work for me, are they succeeding in life? Are their financial dreams coming true? Are they getting what they want out of life? Is my business a place where people show up, check a box, they came in, they're scraping by and doing what they can? We don't want that. We want a business where people are thriving and proud to work with you and be on your team or work at your brokerage. That is what we are looking for.
We want to have the right team members and the right seat on the bus. We may need to do some cleaning at the house, which means that there are some attitudes, venomous behavior that may need to go and that's okay. Those are all things that we can get help with. You would be amazed at how much moving 1 or 2 negative people out, how it has such a huge impact on the rest of our business. It is important to hire and fire. Hire slow, fire fast. When you realize you've got the wrong person on your bus, get them off quickly. If you think that perhaps they're a nice person or fit the culture, but they're in the wrong role, then let's get them moved quickly. If you figure out that you have a person who was doing great and should be promoted because they can handle more responsibility, let's move quickly to get that done.
Your business will rise and fall on your people and your processes. You need to make sure that you have the right people in place. You also have to make sure that you have great leadership. You should be able to leave your business and go on vacation, a mission trip, help a sick friend or a sick family member, and your business should not suffer. Those are the types of people in leadership you should have in your business. Sometimes the best leader is your admin. Your administrative assistant, executive assistant or director of operations is sometimes the best person to leave in charge because she or he will get it done while you're gone.
If you don't have that person, then we need to be looking for them. We need to be looking to add that person to the team and move someone else or remove someone else from the team. Whatever that looks like, it is what it is. Don't be afraid of it and make those changes. I give you permission right now to make changes on your team. We're going to remove fear, angst and anxiety. We are going to do what we need to make sure that our team is successful.
Profit And Savings
The last thing I wanted to talk about is profit. For a lot of years, budget was a dirty word for me, not at work but at home. I could not be constrained or confined. My answer to budget was always to make more money. If I make more money, I don't have to watch my spending. I then realized that I always had expense creep. The more I had, the more I spent. I would make more money and spend more money. By the grace of God and my husband, I have a retirement because my husband was squirreling away money that I would've been spending. It's very important that we understand that our spending habits have an effect on our profits and our bottom line in our home and our business.
Now, we're focusing on business so let's keep it there. With your business, as far as your budget is concerned, you got to get a grip on your business finances. I refer you to episode 6, with Leigh Brown, Getting a Grip on Your Business Finances. You got to get a grip on it. The reason why is because if you ever hoped to exit production or to leave that business and have some passive income coming in, you can't have a hole in your bucket. When we don't have a tight rein on our budget, then we are spending money left and right on leads that have no ROI. We're burning up money there on people who don't work. They're not doing anything but they're collecting a check from us or they have a stinky attitude in the office. Our good people are leaving who would be bringing in money. You've got to look at your commission structure. Are your splits too high?
Your business must be profitable. By profitable, according to Gary Keller, MREA, The Millionaire Real Estate Agent, your profit margin should be somewhere between 30% and 40%. If you are not receiving a paycheck from your business and a profit margin of let's call it 35%, then we need to look at what we are doing with our money. Why not? Why is this not happening? Where's the money suck in my business? Something is sucking money out of your business. You've got to find out where it is.
The other question to ask is, are my agents or team members bringing in money? Are they bringing in profits? Are they bringing in revenue into this business? Are they here for the lunches, training and leads that we provide, but they are not contributing to the bottom line? You've got to ask yourself that question when it comes to your profits. Finally on profit is savings. Your business should have six months of savings. With a global pandemic, we all now can appreciate why we need a minimum of six months of savings. Ideally, we'd like to see six months of savings for each staff member for their salaries. I know that our agents are 1099 or they’re contract workers so we're not obligated at all. If we wanted to give them something to help out, that would be in our savings.
I know a couple of brokers were able to give vouchers during the pandemic. We're giving vouchers or Visa gift cards or something to that effect to buy groceries or toilet paper, whatever it was needed by their agents, which was nice. They didn't have to do that, but they did. Great people like to work with great people. If you want to keep your good people, do nice things for them. As far as your savings are concerned, set aside savings for your business. Taxes, you cannot forget savings for taxes, at least 15%. If you want to be on top of your game, 20% of your income should be set aside for quarterly taxes so that you can stay on top. Don't ever get behind on your taxes. If you do, there's always help but you want to stay ahead as much as you can for the sake of your business, your team and finally, for your family.
For now, that’s what I wanted to cover. The Renee Williams Group is all about your business, your body and your state of mind. We were talking about business. We talked about purpose, processes, production, plan, people and profits. I'd like for you to reach out and let me know on Facebook, message me at Agent Exit on Facebook. You can reach me there with your questions or your comments about this episode so that I can know where we should be focusing to help you the most with your business.
In the future, I'll do a solo episode on your body, in which we'll talk about insurance, physical health and mental health. On your state of mind, we're going to talk about your mindset, your attitude towards wealth and money and your motivation. Those are coming up in the future solo episodes. For this episode, I wanted to cover these topics with you. If you need help in your business, you can reach me at RealBie.com for operations help and exit strategy planning. The Renee Williams Group is here for you. You are winning, you can do this, and I am here to help you get it done. I want to make sure that you have a business and a life that you absolutely love. Until next time, stay tuned and keep reading. Thank you so much, ladies.
The 5 Years Before You Retire with Emily Guy Birken – previous episode
Getting a Grip on Your Business Finances – previous episode
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