There's a great book by a guy named Harvey Mackay. He wrote the book Dig Your Well Before You're Thirsty.
And in the book, he talks about this $25,000 question, and I'm gonna pose this question to you.
So the $25,000 question kind of goes like this:
Imagine you own a muffler shop or some kind of business. And it's payroll week and you don't have the money to pay your employees. And you know, if you don't pay 'em, they're all gonna walk because everybody's trying to hire right now. So the question mark is it's 2:00 AM you wake up in the morning and you're like, I've gotta come up with $25,000 by tomorrow morning. Otherwise I'm probably gonna lose my business. Who do you call? In your friends list, your personal friends list, right now, is there someone you call and get $25,000 from by tomorrow morning?
If the answer's no, the reason you probably don't have anybody that qualifies in that category is because you haven't helped enough...
I'm gonna give you some numbers that are just reality in our business that you should know. And these numbers are going to drive your success throughout your career — whether you like it or not.
Are you ready for these numbers? Here they are:
They may be slightly different for every person, but in general, across the country, here's what the numbers look like in our industry:
* For every 30 conversations you have, you'll average one closed transaction.
And I want you to remember this:
Almost every single transaction you will ever have in your career will be the result of a conversation you've had in the last two weeks. You want more closings? You're gonna have to have more conversations.
Here's another one:
* For every 10 sphere members you have in your database today, you should average one closing — assuming that you've made 20 to 50 contacts with them in the past year.
20 to 50 contacts will get you a 10 to 1 closing...
I want to talk to you about what I call the algorithm of sales. And what that means is that there's some base numbers in our industry, that if you embrace them, it can unlock unlimited opportunity.
The problem is most agents don't want to embrace them. They just want somebody to hand them a buyer or seller. Or for a buyer or seller to literally lay down in front of them so they can just start working with them.
Guys, that doesn't work.
You have to go out there and work the numbers if you want to do well.
I'm going to give you six numbers that are going to be just what I would call standard in the industry that you have to embrace for you to have success.
1. For every 30 conversations you have, you'll average one closing.
So if you want to make 300, 400, 500, $600,000 a year, you just have to figure out how many closings you need. And then multiply that number by 30, which will tell you how many conversations you need to have in...
If you have a gap in your income right now and you're out of escrows, what's the cause of that?
The cause isn't anything you're doing right now.
It's not the market conditions.
It's not something you just did yesterday or the day before.
It's actually something you've done 90 days ago.
Whenever I do this with my coaching students when they're having a gap in closings, I tell them to look back to 90 days ago.
What were you doing 90 days ago? Let's really look at the calendar and open it up. When we open up that calendar, we'll inevitably see a gap.
Maybe they went on vacation. Maybe they just took a few weeks off because something was going on in their lives and they stopped prospecting 90 days ago. And that's what comes forward like a snake eating an egg. It just travels down the timeline and then boom, it blows up resulting in them having no escrows in the moment.
So how do we eliminate this situation so we don't have gaps in the future?
What is Q2?
Well, Q2 is your most valuable asset. And you might not even know it.
Your most valuable asset is your database, your sphere of influence, we know that.
But what's Q2 mean?
Q2 represents the quality and the quantity of your database. So let's look at those two issues and how they can impact your bottom line coming into the new year.
Let's start with the quantity. What does that mean? Well, if we know that for every 10 people in our database, we'll average one closed sale, knowing that quantity makes a big difference. In fact, when I talk to agents on a regular basis, and I ask, how many transactions did you close last year? And they say 10, 12, I'll say, how big is your database? Let me guess. It's probably 80 to 120 am I right? Most people will say, yeah, you're right on the money.
Because your database is a reflection of your performance. Smaller database, smaller performance. Larger database, larger...
This time of year, a lot of people start thinking about pivoting — making a fundamental change in their business strategy. That's a good idea, because if you want to have that 90 degree turn in your business, you need to think about what you can do to actually make that a reality.
Not just talk about it, but actually make it a reality.
I'm gonna give you five quick points that I've learned over the years that can really help you have a successful pivot in your business and make fundamental change happen for you.
1. Mental toughness
This is underrated, but how many of us have started new year's resolutions with the best of intentions, but then falling apart within 30 days? We’ve all been guilty of that (myself included).
So mental toughness, getting your mind, your body, your spirit in alignment with that decision and saying, I'm not just doing this today or tomorrow or next day or next week, I'm doing it for...
Now that we have arrived in July it's time to do a six month review of your performance. By reviewing your numbers you can get a clear picture of your businesses trajectory.
This simple exercise can identify what's working, what isn't' working, and where to adjust your strategy. Your mid year results are the culmination of all of your time, work, and marketing investments, it is also reflection of your follow up skills, your presentation materials, and your ability to stay consistent.
Watch this video for a complete breakdown of how to conduct your mid year review!
How big does your real estate database need to be to hit your goals over the next 12 months?
If you don't know the answer to this question it's highly likely you will have a difficult time hitting your target. The Power-Base formula can answer this question and it can give you two clear paths to more profitability. What is your Power-Base? It is a factor for how many people in your database are required to create once closed transaction.
Watch and learn as Jim explains the Power-Base formula in just over 3 minutes while providing you two easy ways you can use your number to net more commission income over the twelve months.
Do you need more leads, more listings, more buyers, and more closings?
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