I think I may have come to the proverbial end of the road when it comes to my blogging on prospecting. I’ve said it often enough, prospecting and running are very similar. So on yesterday’s run, my 89th of the year, I decided to figure out how much money I would have made if I stayed true to my rules on prospecting.
Imagine this; Your goal was to contact 10 people for every time I ran. Just so we are clear, when I talk about prospecting I’m talking about meaningful real estate discussions that last more than a few minutes. So you’ve talked to 1000 people (100 runs times 10 people).Now, the general rule of thumb for prospecting is that every 50 meaningful conversations will get you a buyer or a seller contract. That means that you signed 20 contracts over the course of the year. Guess what? If you work in Toronto you are doing better than 3/4’s of all TREB agents already. For simple math lets assume that the average commission is $5,000 because, as a new agent, you are doing a few rental deals in there too. This year you have made a pretty decent living.
Prospecting is a simply thing to do once you sit down and put your mind to it. As I have found, it is much harder to do it consistently. Just like running, there are a lot of excuses for not getting out of bed at 5:30 in the morning and hitting the pavement for an hour. What I have learned is that prospecting, like running, can be habit-forming and that is the true key to success. Sure, lots of things can get in your way, and it’s easy to roll over and go back to sleep. The hard part is to take the first step. You get out of bed one leg at a time, right?
So what’s the goal for the next year? How about keeping it simple. Hear’s the funny thing about consistent prospecting that is a real bonus for the following years. Remember those 1000 people who you talked to? They are still prospects. You still have 980 people who you didn’t sign a contract with, so in year two you can add them into your next 1000. You are bound to pick up a couple from the first 1000 and another 20 from the next 1000. See how it works? It’s the sales funnel in action!
Well, I’m going to keep running as long as my knees and back hold up. Now I just have to think about other things to blog about. Any ideas?
We had an interesting debate last week at Mastermind about taking an overpriced listing and who and how the price was determined. Have you ever asked an agent ‘Is that the Seller’s price?” because essentially what you are saying is ‘hey, that price is so far out in left field you either don’t know what you are doing or the Seller has chosen the price himself’. Anyway you slice it, no agent wants to hear this question. Sure, ask it as often as you want, but be prepared for the day when the shoe is on the other foot.
So, for a moment, let’s assume that you have taken a listing and the owner has insisted that you list it $100K over fair market value. You took the listing because it is in the neighbourhood that you want to farm and the Seller has agreed to revisiting the list price after a few weeks of “testing” his price. Perhaps you feel confident that you can keep hammering away at the home owner for price reductions. Eventually you get “that” call. An agent calls asks you if it is the Seller’s price. What would you say? To say yes would make you seem unprofessional and perhaps reveal that the Seller is in the driver’s seat but to say no might suggest to that agent that you ‘bought’ the listing. dilemma? Not really. Your best answer is “I would encourage you to bring an offer that you and your Buyer find fair”.
At the core, this whole conversation starts with the listing agent’s initial discussion with the Seller about why his value is so much higher than the agent’s own competitive market analysis. Perhaps you are missing something. Probably not, but lets keep an open mind. The Seller believes his home is more valuable for a number of reasons. Sure, you can see some of his points, even though they are dull ones, but as a duly appointed representative of the Seller, and since you agreed to take the listing, it is your job to go out and stand behind that price. Have you ever heard the term the walls have ears? Saying something negative about the Seller or the list price will come back to bite you. Recently I heard a story of how an agent lost a listing because during a showing she made negative comments about what a dump the kitchen was. The owner and proud kitchen designer was hiding in the pantry listening. We live in a time when nanny cams in homes are as common as dishwashers.
Treat your client fairly and don’t reveal your true feelings about their price. Hopefully you have put into motion a plan and timeframe to revisit your pricing strategy. I suppose the flip side to this argument is that you let someone else take the overpriced listing and let them spend money trying to market it. That is a personal decision only you can make.
Last week I had a few freinds up to my farm in Prince Edward County. As I usually do, I started my Saturday morning with an early morning country run. When I got back, my buddy asked me how it went. I had to admit it was a tough one. In the early stages I just couldn’t get motivated. At about the 3rd kilometre I thought about turning around. That thought didn’t go away at kilometre 4 or 5 but then I thought, heck if I turn back now I’m already in for 10km so I might as well just keep going and do my 12kms. He said to me that pushing yourself like that is kind of like eating an elephant. I thought this was another great metaphor for running, business and life. My apologies to the vegetarians in the crowd.
Think about it for a moment. How does eating an elephant relate to being a great real estate agent. First of all, you can’t just start your career in real estate and expect to be a rock star right off the bat, neither can you expect to eat an elephant in one sitting. Just like our business, being successful means working up to it, accomplishing small tasks individually to get to the ultimate payoff. It’s clear that there are no quick fixes or easy paths to success. That comes only from hard work and determination. It is a very long process. I contemplated doing the math on how much people eat in a day compared to the weight of your average elephant, but I think you get the picture.
While we talk about the importance of social media to our business, it shouldn’t be the only thing we do. I think we all agree that it is a necessary part of our daily routine just like inspecting or showing houses, taking care of our accounting, connecting with clients, catching up on industry news or attending office meetings.
The point is that eating an elephant can be done as easily as being a great real estate agent. You just gotta pace yourself.
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