Last week I included the 80/20 rule in reference to the amount of time a successful real estate agent should spend in generating new prospective clients. I stated that one should spend 80% of their work day contacting new leads and allot 20% of the day for taking care of all other business activities. Early in a real estate career, 20% of a work day is plenty time to accomplish other business activities but once production increases, 2-3 hours a day is not enough time for listing and showing appointments. When this happens one will usually spend less time in lead generation. This is a huge mistake. Securing a client to represent (lead generating) requires more expertise than a showing appointment. Lead generation is not looking for today’s sales opportunity, but it is securing future business. If you take time away from lead generation, you are reducing future sales opportunities.
If the proper preliminary work is done, and you have had the proper conversation with the clients, any licensed person can show a property. The property speaks for itself. Let’s look at a perfect scenario with Joe representing Mr. & Mrs. Jones. Joe has had an honest conversation (consultation) with the Jones’ to find out their real needs and desires. Joe has done his preliminary work and has selected three properties to show the Jones’. Joe gets the Jones’ to come by the office where he discusses the three properties and reviews them on the internet. Joe instructs the Jones’ that his assistant is going to show them all three properties and asks them to determine which one best suits their needs so you can discuss them upon their return to the office.
During the time required to show the properties to the Jones’, you will be allowed time to continue working on producing new business or follow up phone calls with current clients. Your assistant is taking care of the busy work of showing the properties. The properties actually sell themselves. The Jones’ will either like a property for particular reasons or they won’t like it. Neither you nor your assistant can change the things they dislike about a property so you haven’t missed anything by not being there. They return from the showing and you have a consultation with Jones’ to determine which property they liked best and disliked most, and to see if they want to write an offer on one of the properties. Let’s just say it took two hours for your assistant to show the three properties. How many leads can you have a conversation with in two hours? This does make sense to you, doesn’t it? Yes but I don’t have an assistant, one might say. Why not? Because I can’t afford to hire an assistant, or I don’t have enough business to afford an assistant; they might say. Why not?
If you spent 80% of your work day generating new business, you would have enough business to afford an assistant. Let’s apply a little common sense to this scenario. You own your own business. You have expenses in maintaining your business. If you have completed a business plan, you have already determined how much income you must produce per hour in order to meet your financial obligations and make a profit. Let’s say that your hourly rate is $500 per hour. Now let’s say you hire an assistant that needs to produce $50 per hour income to offset employment cost. Which is the best choice to go on a showing appointment; a $500 or a $50 an hour person? Let’s say you’re working on getting documents together to close a transaction. Which is the best financial decision to be working on the documents? I think you get you the point.
The real question might be when can you afford to have an assistant. The answer is when you can’t accomplish everything you need to accomplish in the 20% time allotment. You see, the most important job you have is to be constantly finding new people to work with; staying in constant contact with the clients you have, and negotiating transactions on behave of your current clients. Only the most productive agents in the country spend 70-80% of their time lead generating but that’s what every real estate agent should do. If you truly want to be successful, you need to set high goals, and remain focused on reaching those goals. You won’t attain your goals if you allow less important things dictate how you spend your time.
If there is one most important technique you need to master as a real estate agent, it is the ability to have meaningful conversations. Notice I said “meaningful” conversations. This is when you spend more time listening than you do talking. The web along with social networks can assist you in building name recognition, but nothing produces new business without having conversations. In short, you need to be able to converse with people; people you have never met before; total strangers. The underlying reason for the conversation is to begin the relationship process. People buy and sell through people they have some type of relationship with. Once a relationship is begun, it should be enhanced on a consistent basis so that they not only use your services, but they refer their acquaintances to you as well. Referrals won’t come until a relationship is established which creates a certain amount of trust and respect.
There are many ways to acquire an assistant. First of all you need to only hire someone that holds an active real estate license so they will be able to perform all duties required, such as showing property. Personally I want an assistant that demonstrates strong character and professional traits of behavior.
I want them to be loyal and productive so I need to pay them well for their services. I want them to understand my business plan and buy into my program so they can not only help my reach my goals, but will also be committed to reaching the goals we have determined for them. A professional assistant can either be compensated with a salary, commission, or a base salary plus commission or any combination that might also include quarterly bonuses. When hiring an assistant it is very important to remember that you get what you pay for. They are an extension of you so make sure they are capable of representing your professionalism. It is also beneficial to enter into a contractual agreement that contains a no-compete clause for a predetermined period of time. You don’t want to spend time training people just to have them leave and go in competition with you. Hiring an assistant is a big financial obligation, but it will also help move you toward success much quicker.
Should you have specific questions concerning various issues, please let me know and I’ll research the answer for you. I also want to encourage you to subscribe to our “News & Updates” weekly report so you can stay abreast of issues that might affect you when buying or selling real estate. If you haven’t visited my website, please go to www.AlabamaRealEstateInstitute.com and view previous articles.