Rich Levin is a national real estate speaker and sales coach. His company, Rich Levin's Success Corps Inc., Rochester, N.Y., takes a "whole business approach" to coaching, focusing not only on essential sales skills such as presenting and prospecting, but also quality of life and personal finance. Contact Levin at 585-244-2700 or firstname.lastname@example.org.
Measure of Success: How to Get Your Career on the Right Path
There's a roadmap to success. Are you following it?
July 1, 2010
What frustrates most real estate professionals? What makes them feel less secure and confident?
Typically, the responses are:
- “Not knowing where the next deal will come from, or if it will come.”
- “The roller coaster, feast-or-famine nature of the business.”
- “The constant pressure.”
Sound familiar? You might consider these inherent and unavoidable annoyances that just come with the job. But it doesn’t have to be this way.
Take a moment and really consider the following question: If you were lost in a strange city, how would you feel? Uncomfortable? Distressed?
However, if you had a map or GPS, you likely would not feel disoriented and uneasy. You could confidently find your way around with no frustration or fear.
Too many practitioners conduct their business as if they were lost. They “drive” their business by finding buyers and sellers and by listing and selling property. But they don’t know where they are. Are they ahead of their goals or behind? Ahead of last year or behind? Winning or losing? They just don’t know.
Mapping Out Your Success
But there is a way to measure your success, and keep on its path. Consider how a GPS works: You put in your destination and it guides you in multiple ways. First, it leads you turn-by-turn. Then, it tells you the distance to reach the next turn. Also, it will continuously adjust your arrival time, if needed.
In your career, your GPS is a very simple set of “success charts” that guide you in precisely the same way.
- You “put in” your destination by choosing your annual sales volume goal. (There is a trick to this. See below.)
- Then, you set sales volume monthly goals, which serve as benchmarks along the way, so that you can tell the distance to your next turn. On your success charts, you simply record your progress, just like the GPS does.
- You then add up your monthly progressions to determine your year-to-date total.
The Trick to Keeping Track
The only solution to being lost in your business is to know what is happening, as it’s happening. A good tracking system will let you monitor where you’re ahead or lagging. Here’s how to keep a measuring system:
- Sales volume: The trick is to set your annual goal and monthly sales volume goals by contract date, not closing date—that is, by the date of accepted contract, not closing. If the reason for this is not obvious to you already, I promise it will become obvious as you do it. One small detail: As you record your sales volume, be sure to also log the total number of sales and whether the sale is to a buyer or one of your listings that sells. If it is both, then regard it as two sales.
- Listings: Set up monthly listing goals and record listing progress the same way as your sales: monthly and year-to-date. The key to your success with listings is to use your sales volume goals to determine the number of listings required to reach your objectives. As a rule of thumb, figure that half of your sales will be listings sold.
- Income: Similar to listings, make sure you record it. Also, it is best to record it as soon as the contract is accepted and initial contingencies are removed. Of course, you’ll want to record it in the month that you are scheduled to receive it.
The Most Important Measure of Success
However, the measure that really tells you where you are at the moment is not sales, listings, or income. If you make a wrong turn, your GPS alerts you immediately. Similarly, the measure that provides this “wrong-turn alert” in your business is new (initial) appointments per week.
You create this by using a success rate of initial appointments per sale. For most practitioners, that number is at least two to one, which means if you want to make 20 sales, you need 40 initial appointments throughout the year. Be sure to record your initial appointments each week and you’ll know exactly where you are in relation to your goals.
What Gets Measured Gets Done
Many real estate professionals won’t succeed without knowing these numbers. Those who do manage to slip by without monitoring these numbers are often fraught with fear, frustration, and insecurity.
Put yourself at ease: Start recording and reviewing your numbers every week (though every day is better). It will take you less than 10 minutes once it's set up.
In return, expect rewards of higher production, income, confidence, and self-esteem. Plus, by setting your business on a path to success, you’ll never feel lost again.