17 ways to keep more of what you earn

Your bottom line doesn’t know whether you earned it or saved it, so start saving today.

by Walter Sanford   I keep hearing it. Profitability is still a major problem in real estate. It seems we have lots of superstars with big grosses and no nets. Panelists talk about amazing systems and teams that produce amazing results and amazing amounts of buyers and sellers. One problem … they’re taking average amounts home to the bottom line.

The work-to-reward ratio in real estate is high. Why? We get too busy to pay attention to simple business strategies.

Review this list and hone it frequently. You’ll find these tips easy to follow once you see the money going into the bank instead of overhead.

1. Look at the office-supplies acquisition lists before making any purchases. Believe it or not, office supplies are one of the largest cash drains in your organization.
2. Test all direct mail before you send substantial amounts of it.
3. Stop doing lead-generation activities unless they are at least a four-to-one ratio of gross to cost. If you can’t prove there is a gross but still think it’s a good idea to do it, think some more.
4. Live on 90% of your income (meaning 10% is either saved or invested). If you don’t, you will have buyers in your car until you’re 85.
5. Write your own checks. Never let anyone else pay your bills until you are worth more than $10 million (an Andrew Carnegie truism). It allows you to reflect on the importance of all your expenses, their need to exist, and it just plain gives you a sense of reality.
6. Negotiate harder. Too many agents and brokers take that first price from printers, sign makers, and advertising media. Either come back with a counteroffer, use someone cheaper, or get multiple bids. We recently asked for bids on five products from six printers. Though we gave the very same detailed specs to all six, the bids ranged from $11,000 to $57,000!
7. Do things faster. Remember, time is money. If you can cut a process down by using a lean checklist or delegating items to broker-paid staff or affiliates, you will find you have more time to make that extra hour of phone calls.
8. Watch the I’m-too-busy-to-eat-at-home syndrome. At least pack your lunch. Dinner and lunch out all the time will make you fat and your wallet skinny.
9. Contact your past clients more often and make your contacts more effective. This is your future business. Pay attention to the acquisition, implementation, and organization of your database. Repeat and referral clients are still the least expensive and the best.
10. Spend a larger amount of time improving your services to buyers and sellers. Unless you start developing your service policies today, there will be no need to prospect in the future, because you won’t have a business.
11. Quit spending time hanging out in the office. Nobody there buys or sells through you. I’m only there for phone work and buyer appointments.
12. Today, the differences in phone services, insurance, maintenance contracts, and utilities are staggering. Pay attention.
13. Cut car costs. Fancy cars are the worst investment you can ever make. (This is spoken from loads of experience.) Buy used.
14. Focus on what you are best at. That is subsequently what produces the most profit. Instead of believing you can do it all, go back to that one thing and double your efforts immediately.
15. Carry your shoulders back, stand up straight with a smile on your face, look good, drink lots of water, get lots of sleep, eat well, and play. (That is, play when you’re playing and work when you’re working.) Call your mom.
16. If you ever hear in a seminar, "It has all the bells and whistles," or "It really impresses your client," someone is trying to sell you form over substance. Make sure you have substance before form.
17. Show up, tell the truth, and don’t be attached to the outcome.

These reminders will keep you on the straight and narrow, and, applied over time, increase your bottom line. Remember that a profitable real estate agent will always be the market-share winner in the end.

Walter Sanford is a top-producing real estate agent and speaker who travels the country delivering systems and strategies to top producers for higher productivity and client satisfaction. He will be the keynote speaker at the TAR Convention in September.

Copyright© 2000-2001 Walter Sanford. All rights reserved. For information about his keynote presentations and training seminars, please contact the Frog Pond Group at 800/704-FROG or e-mail susie@frogpondgroup.com.

Photo © PhotoDisc.

home   current issue    top 10    resources 

discussions   contact us   search

Buyers & sellers, visit www.texasrealestate.com.
REALTORS®, visit www.texasrealtors.com.