Mid-Year Litmus Test for Productivity and Success

by Allen Wright

Can you believe 2006 is already well past the halfway mark? Before the second six months speed by, carve out a few hours to check your actual progress against the projected goals you outlined for yourself at the beginning of the year in your business plan. You might want to consider using the grading scale below to gauge your success so far. Give yourself the following points based on the work you've completed (maximum 10 points - no partial points allowed):

Scoring System:

• One (1) point for recording all activities and appointments
• One (1) point for entering actual expenses itemized or in aggregate
• One (1) point for entering all transactions for the second quarter
• One (1) point for entering expenses associated with closed transactions
• One (1) point for reaching your expense projections
• One (1) point for reaching your activity projections
• One (1) point for reaching number of closed transactions projections

Bonus Points:

• One (1) point for each projection you exceeded in activities or closed transactions
• One (1) final point if you spent less money on overhead or marketing than you projected

If you scored 0-2, there's no doubt that you are operating well below your potential. It's time to shape up; your competition will ship you out. If you ended up with 3 or 4, know that you are beginning to look more and more like Mr. or Mrs. Average Agent. This is the No Man's Land where no one really wants to be. It's time to take a fresh perspective and kick things into gear. If you scored in the range of 5-7, you're doing a good job - better than most other agents. You might even have the makings of a bon-a-fide long-term top producer. Make sure you have a solid plan, give it consistent scrutiny, and stay focused. If you ended up near the top of the scale, between 8 and 10, there's no arguing that you have your act together. Excellent job - 2006 should be a great and profitable year for you!

If you find yourself a part of the majority - that is, those who did not score near the top of the scale - consider the following suggestions for improvement. Start by examining your activities. Did you record the activities you are performing each week? This is a top priority, simply because it is the foundation for making better decisions and running your business like a business. If you didn't record your key activities, consider using an accountability partner that will help you reach this goal. Then examine the categories in which you failed to complete 100% of the projected activities. Take a pen and write down why they remain incomplete. Ask yourself the following questions,

• Is this an activity that I need to re-examine?
• Is it producing appointments for me?
• Does it cost me money out-of-pocket?
• I'm I creating closed transactions from this activity?

It may be harder to discern your cost-effectiveness for some marketing activities - especially those conducted for the purposes of visibility and branding. If you are uncertain about eliminating a certain marketing activity, consider asking several people within your sphere to give your opinion concerning its effectiveness. Most people feel flattered when asked to provide feedback that will help mold a colleague's business venture.

Now take a look at the activities you performed which met or exceeded your projections. Are there any similarities between these activities? Do you like doing these activities more than the ones that did not meet your projections? Before determining whether to stop doing an activity that does not seem to produce anything, consider these questions:

• What are the costs associated?
• Is this activity part of a general awareness campaign, or does it have specific intent?
• Can I change cost or the results of this activity?

If a particular activity fails to produce appointments for you on a regular basis and costs you money, delete it from your list. Activities that have little or no financial impact on your budget should remain in your plan. After reviewing all of your activities, reward yourself for completion and a job well done, and then turn your attention toward your expenses. Take a closer look at the expenses you have recorded, and ask these questions:

• Are you meeting your plan for dollars spent on overhead?
• Are you over or under budget for any particular marketing campaign?

With a good six months under your belt you should have a solid understanding of the monthly costs you incur to remain in this business. Remember that changes to your business plan in one area will have a domino affect in others, so make sure you review your plan after any major change to ascertain how that change has influenced your overall business development plan. When reviewing marketing campaigns, be careful! Make sure that cost reductions do not hinder your business growth, especially in the area of closed transactions - your bread and butter. Speaking of transactions, let's move on to that aspect of your plan. Examine the transactions you closed so far this year; both closed transactions and associated expenses. With regard to those two topics, consider these important questions:

• Am I meeting my closed transaction projections?
• Is my business coming from the sources I anticipated?
• Am I recording the expenses associated with each transaction?
• Are my actual associated expenses remaining consistent with my projected expenses?

During your initial review of year, after the first quarter, revenue was not the highest priority; the focus was centered on activities, expenses and transactions. Now that we've reached the middle of the year, your revenue figures should have averaged themselves into a more consistent stream. If you are not meeting your plan for revenue, check to see which components are not meeting your expectations: Average Sales Price, Commissions Charged, or Commissions Received, or a combination of all three. If each of these numbers seems to indicate a strong beginning, a lack of closed transactions would be the only reason you would not be meeting your revenue.

If your revenue numbers are slumping, a change of tactics is in order - either that or a reduction in overheard. An old sales adage goes like this: “Pick the low hanging fruit first.” The “low-hanging-fruit” in real estate sales are those transactions which are the easiest to close. They could be repeat or referral customers, investors or relocation clients, those that require the least involvement for the biggest payoff.

Although this notion may seem a bit contrary to the survival mentality of “beggars can't be choosers”, if you sell in a market environment that lacks inventory, your quickest transaction will be directly tied to the discovery and procurement of a property to list. Conversely, in a buyers market your quickest transaction remains a client who needs to purchase quickly, such as inbound relocation.

Once you've picked all of the low-hanging-fruit, turn your attention toward long-term business development, including a mix of referrals from past clients along with website canvassing and farming. Whatever you do, don't get caught up in the contemporary definition of insanity: performing the same actions over and over again and expecting different results. Keep doing what you've always done, and keep getting what you've always gotten.

As you wrap up your mid-year evaluation, find a creative way to reinforce the success-oriented habit of recording your activities, expenses and transactions. Remember the Golden Rule of sales management, “If it can't be measured, it can't be managed.” With half of 2006 now behind you, refine those activities that are working well, and reexamine those that are not. Tighten down your focus to include only those activities that produce the greatest number of appointments, and ultimately, closed transactions.

To that end, you might want to try CreateAPlan, an online business planning and management tool capable of automating your record-keeping process, calculating year-end goals on the fly, and tracking your daily performance. To get on your career on the right track, CreateAPlan can create or refine your personal real estate business plan.