How to Determine When to Stay Persistent in Real Estate Investing
When you obtain deals, how do you gage when to slow down or increase marketing?
Knowing you can only manage so many deals at one time, it could be difficult to gage when to slow down marketing or if you should increase or continue at the same rate.
There are key concepts to understand when you are acquiring and anticipating the next deal.
This is not spoke about much, but it is a common dilemma business owners face in deciding the directions to take.
In the day-to-day operations, customer service is number one. So, driving-in more business than you can handle, would not be a wise choice.
Many real estate investors deal with this and make their own decisions.
But, how should you gage when to slow down, keep pace or increase pace?
Let’s start at the root of the issue and work our way to the solution.
When you first get started and you are looking to build consistency in your deal flow, it is common to go heavy with all kinds of marketing to bring you the best results.
When you “get a yes”, it feels great and you cant wait to meet the customer.
This is a common feeling amongst investors. Anticipation of getting leads…
After-all, a gage on how well you are performing, is how many leads you can acquire.
With each lead, you are closer to closing a deal. So this anticipation is important, but it is crucial to also understand your capabilities after observing your results.
This brings us to the next point.
Is everything like a clock? Well, in fact, yes it is.
The time it takes you to get a interested lead, the time it takes to complete the acquisition through closing, the time it takes to renovate and resell (or perform your exit strategy), are all about time to completion.
- How long does each step take?
This is an important concept to understand if you are looking to build consistency in your deal flow.
It matters how your anticipation and persistence should line up together to give you the desired outcome.
It is very common that once, we get a deal, the relaxation settles in.
We naturally slow down our marketing and concentrate on the deal we have.
Especially if we are learning throughout each step of the acquisition and disposition process.
Gaining a lead through acquisition, guiding your customer through the next steps in the closing process and partnering with parties to complete your renovation and resell (or disposition) is a learning curve.
After these processes are completed, the process restarts itself.
However each step takes concentration so they are understood and completed effectively.
What is key is that we adhere to the best practice based upon our time to complete each step. When, where and how to apply the best actions to flow into a new deal, as soon as you are done with the current one, is the idea.
This is a learning curve and is not easy. However it is a number game, just like everything else in business.
If customer service is a leading attribute of your business, you could be thinking about how your actions will affect the customer. If you haven’t thought about it, you should.
If you don’t act accordingly, and you overwhelm yourself, then each new customer you take on, could receive mediocre service at best.
Communication, follow through, engagement and relationship development are all vital aspects of you earning and sustaining business.
It is important to observe these factors and determine what your best plan of action is to balance each well.
As you begin to understand the law of averages, it is imperative that you also understand actual versus anticipated business deals.
How many times have you felt you had a deal locked up and something changes causing you to not acquire that deal? A customer may sound really motivated and you may have had great dialog with them to cause you to think the deal can be counted as acquired.
This is the anticipation versus actual results you must adhere to. This is common sentiment. A deal sounding very good, but could take much longer to acquire than what it feels like, is the truth.
- To understand this, we have to apply it to each person involved – you and the client.
People are different and each person has a level of follow through, communication and balance of daily duties, they are managing. The priority of each person is only theirs to know and own.
You will never know that person’s priorities unless they tell you.
So, on Monday you may have had great dialog with a client and you’d think you’d have the deal locked up by Friday. But, on Tuesday the customer has a shift in priorities when something else arises. Now, you have been pushed back two weeks in the customers plans and you will not be aware of this. If you fail to follow up, that could turn into a month or the deal being possibly lost.
Transitions of people’s plans can happen fast and your anticipation on closing that deal could not be realistic, based on your original feeling.
For this fact, you must be prepared to continue pursuing deals based upon the law of averages.
As you see, numbers play a key role in the decision-making process.
The turn time for each portion of your business is crucial to understand. We call these KPI’s or key performance indicators.
It may take time for you to capture enough data to determine your KPI’s, but it is important to do so.
Also understand, every individuals KPI’s are going to be different. People normally excel at things they are strong in, and have difficulty performing things, they are not as strong in.
The KPI’s of your team and the application of the tasks for each person, will greatly affect your operations overall performance.
Use these performance metrics to plan for peak performance.
How long does it take before you’ve acquired a deal? Literally from start to finish…
The mailing, the inbound call, the home visit, the contract, the closing, the renovation, the resell and the final closing…How long does it take?
Understand that each task and when the process begins for each task, should align with when your next deal should be acquired, based upon your KPI’s.
There are some key concepts to understanding this flow of business to can plan accordingly.
- See our previous article titled The Law of Averages: Real Estate Acquisitions to seek some insight on this topic.
Regardless, you must apply this knowledge, so your application of acquiring leads is persistent according to your anticipated results.
In day-to-day business, there are several moving parts.
Obviously, it is crucial to capture true results and apply them accordingly so you achieve your anticipated outcome.
Your persistence within applying these techniques, can only be learned if you understand your results.
Each player on your team is accountable for their results and its up to the coach to apply, correct, prune, motivate, inspire and teach your tram how their results affect everyone, and how everyone can be better together.
Apply what you learn and keep these things in mind, as you are building your business. It will be very helpful in catering to how well you all perform.
Applying persistence accordingly, so that your anticipation aligns with true results, allows the best return on your actions.
We hope this article has been helpful for you today and we which we great success.
Thank you for joining us today faithful readers – future leaders.
Love ya and continue to strive for growth.
Please comment how you apply persistence along with anticipation of new business.
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