Saul's Notes

Blog by Saul Klein
San Diego, California

A collection of notes and observations by Saul Klein, CEO of InternetCrusade.

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RE: Thoughts on selling your real estate sales business
This is a very interesting and important subject&n...
re: Thoughts on selling your real estate sales business
Hi Julie, I think we can add to what we have here...
re: Thoughts on selling your real estate sales business
Saul, Great post! This one is a keeper as I work...
re: Thoughts on selling your real estate sales business
Good post with things to think about. I heard this...
commitment
The text about what happens when you commit yourse...

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Business Planning

Thoughts on selling your real estate sales business

Mar. 8, 2007
Categorized in: Business Planning
The bottom line...preparation, planning and the ability to quantify the bottom line.

How do you evaluate a personal service business? What determines the value, and what someone would be willing to pay for it? What is the "present worth of the future benefits?"

Look at a property management practice...the revenue can be quantified. Having said that, what do property management practices sell for? One times the annual gross revenue? 1.5 times the annual gross revenue? (a property management practice can also be a great source for future commissions).

When one sells income producing real property, it is usually priced by a factor of the net income and the income is examined in three areas:

Quantity - the amount collected
Quality - financial stability of the tenant
Durability - term of tenancy (long term leases are generally preferred as they should make for lower future vacancy and thus, higher overall quantity)

A real estate sales business is a little more difficult to quantify. I think however, it is important to have more than a digital database of names and contact information. Other facts about the client base should be important factors as well.

Amount of new business is part of the "value equation" as well as repeat business from your database. To estimate a value of your real estate business, examine the idea of "Quantity, Quality, and Durability."

Contact and Client Management Software - Top Producer and AgentOffice are not the only options and often, because of their steep learning curve, may not be the best choices

The concept of bringing in your successor over time also makes some sense to optimize the transfer of your business because you are in a personal service business and your database alone is not very personal. A "turn over process" will maximize the success of the person buying your business which should mean a greater value for you in the sale.

And let's not forget the terms of the sale...how much down, amount and number of payments, etc.

I am an advocate of preparing to maximize the asset one builds in their business over the years and to do so requires, imho, a lot more thought, preparation and detail than I have heard discussed by many who advocate the "idea" of selling your real estate business. It is a sound "idea." If one wants to truly maximize this opportunity, the more you can determine long in advance of the sale will help you with the process and the pricing when the time comes to "cash in" (or cash out :-).

Saul

Tips for those new to the business, and those not so new

Feb. 7, 2007
Categorized in: Business Planning
Learn the art and science of sales. There have been many good books written on the subject.

Understand persuasion and how it fits into your business.

Think of yourself as a "helper" (no one wants to be "sold" something). After all, you are helping people with what is usually their
most valuable asset, their home.

To be effective in sales, you need the following:

Product Knowledge
Sales and Communication Skills
Access to Potential Clients
Integrity
Perseverance and Commitment

And let's not forget....
Enough money (capital) to get you through start up and the lean times.

Pay attention to the future...as someone once told me..."that is where you will spend the rest of your life."


Saul

Saul Klein
President/CEO, InternetCrusade

Tip for those new, and not so new in the real estate business

Feb. 7, 2007
Categorized in: Business Planning
Since the average term of homeownership can be somewhere between 5 to 8 years, realize that everyday is a marketing day and the
easiest people to reach (and those most inclined to listen to your message) are those you already know.

Go through your personal address book. Call, mail, or e-mail everyone in your personal address book to let them know that you are
now in the real estate business and that you would love to hear their advice and of course, if they know anyone who is interested in
buying or selling, that you would appreciate if they mention your name. Don't be shy about this. Don't feel like you can't "impose"
on your friends. If your friends won't help you, who will? Ask if it is ok for your to give them an update on your progress after
your first year.


Saul

Saul Klein
President, InternetCrusade

Annual Business Planning

Aug. 21, 2005
Categorized in: Business Planning
Tagged with: business planning


A number of years ago I created and taught a course I called "Taking

Control of Your Time and Your Life." It was a time management/life

management/financial planning /motivational program. I taught one and two

day versions of the program and often did shorter keynote type addresses

to different groups on the content from the course. I always enjoyed this

type of writing and presenting.

 

Annual business planning should be done in the context of your life plan.

Now is the time to begin the thought process which will lead you through

a successful 2006, in both your business and your personal life.
It is important to realize that 2006 (any year) is just part of a much

bigger picture. Do not short change yourself when it comes to the

planning process. Give yourself adequate time. The sooner you begin to

think about the process the better, and the less time it will actually

take to commit your plans to writing and move into implementation. Give

yourself the time you need to plan. Make it a priority. Planning is THE

essential to success.

 

It has been said many ways and two of my favorites
are:

"If you don't know where you are going, any road will take you there."

"Not having a plan is planning to fail."

 

The week between Christmas and New Year works well as a planning period

for me as things are usually slow that week and I have time to reflect on

the past year while I plan for the new year.

 

Planning will give you your best shot at success. Success means different

things to different people, so begin your planning process by broadly

defining what success means to you and giving thought to your vision of a

successful 2006. Specifics come later.

 

To some success will be more income, to others it will be more time spent

with family and friends, to others a combination of the two...and to

others...well, who knows? Success means different things to different

people. Defining what success is for you and prioritizing your goals

requires an examination of your values.

 

How important are the following

to you?

Family
Charity
 Helping others (Money)
 Helping Others (Deeds)
Spirituality/Religion
Wealth and Material Possessions
Education
Self-improvement
Security
Happiness

 

Planning for the future must be done in the context of the future. You

can't effectively plan for the future from the present. You must step out

"into the future" by developing your vision of the future, and then,

"from the future," you will be able to plan your way to THAT future, from

the present. Make sense? Just as we all have 20/20 hindsight and can see

the important steps that led to success from our past, those important

steps to insure success in the present can be more clearly view "from the

future."

 

When considering what you will do each day...as you prioritize your daily

tasks, keep in mind that time is the precious commodity, and none of us

has enough of it. What you do today must help you achieve what it is you

want to have achieved by the end of the week...and what you achieve at

the end of the week must get you closer to what it is you want to have

accomplished by the end of the month...and what you have accomplished by

the end of the month must be that which takes you closer to what you want

to have accomplished by the end of the year...and each years

accomplishments should contribute to where you want to be in five years,

ten years, your lifetime. Your daily decisions should be made with the

bigger picture in mind. You need to determine the "long range"
as it will have an impact on the choices you make today.

 

One way we measure our success is by the accomplishing of goals. Goals

serve another purpose, they give us direction. It is important to set

goals. A mistake made by many is that they set limits on themselves and

do not set their goals high enough. Human beings are capable of great

accomplishment, don't sell yourself short. As Bing Crosby sang in the

musical A Connecticut Yankee in King Arthur's Court:

"There's nothing to be ashamed of, if you stub your toe on the moon."

 

My father often told me that the biggest mistake he made in life was not

setting his goals high enough.

To be effective, goals must be:

1. Written - This will begin the process of making the goal "real."
Place those goals in front of you daily

2. Specific - Specificity will

allow you to focus your intent...a key ingredient to success.

3. Measurable - This will help keep the goal "real."

4. Valued - Based on what is important to you, this will allow for the prioritization of your goals

5. Shared - This will help create the commitment needed to

accomplish even the loftiest goal. Sharing the goal is evidence of your

commitment to accomplishment.

 

It is commitment that is the secret ingredient. As human beings we are

capable of accomplishing whatever we determine is important enough for us

to accomplish. Chose your goals and commit to them wisely...because once

you truly commit, the accomplishment will follow.

 

>>
Until one is committed
There is hesitancy, the chance to draw back, Always ineffectiveness.
Concerning all acts of initiative and creation There is one elementary

truth, The ignorance of which kills countless ideas And splendid plans:
That the moment one commits oneself,
Then providence moves too.
All sorts of things occur to help one
That would otherwise never have occurred.
A whole stream of events issues from the decision,
 
Raising in one's favor all manner
Of unforeseen incidents and meetings
And material assistance
Which no man could have dreamt
Would have come his way.
I have learned a deep respect
For one of Goethe's couplets:
"Whatever you can do, or dream you can - begin it.
Boldness has genius, power, and magic in it".

W.N. Murray
The Scottish Himalayan Expedition, 1951
<<

 

As for your real estate business:

Begin with the dollar amount you wish to earn in 2006. Calculate your

average dollar earned per transaction in 2005. Calculate the number of

transaction sides required to hit your dollar earned goal. Based on past

experience, determine the number of contacts and calls required to hit

your number Make sure you make that number of contacts, at a minimum,

each day. Think about your goal each day.

"Beginning is half done." (Denis Waitley)

 

It's a grind, but the road to success is usually a grind. Doing what you

like to do makes it easier, but there is still a lot of "grunt work"
along the way.

 

Saul

Implementing a Business Plan

Jul. 16, 2005
Categorized in: Business Planning
Tagged with: business planning

 

A business plan will be hard to implement unless it is simple, specific, realistic and complete. In addition, a good business plan requires tracking, follow up and follow through. The key ingredient is commitment to the successful implementation of your plan.

 

Sample Plans from http://bPlans.com :

 

Real Estate Brokerage -

<http://www.bplans.com/spv/3225/index.cfm?affiliate=pas>

 

Property Management -

<http://www.bplans.com/spv/3183/index.cfm?affiliate=pas>

 

The Power of personal commitment:

 

Until one is committed

There is hesitancy, the chance to draw back, Always ineffectiveness.

Concerning all acts of initiative and creation There is one elementary truth, The ignorance of which kills countless ideas And splendid plans:

That the moment one commits oneself,

Then providence moves too.

All sorts of things occur to help one

That would otherwise never have occurred.

A whole stream of events issues from the decision,

Raising in one's favor all manner

Of unforeseen incidents and meetings

And material assistance

Which no man could have dreamt

Would have come his way.

I have learned a deep respect

For one of Goethe's couplets:

"Whatever you can do, or dream you can - begin it.

Boldness has genius, power, and magic in it".

W.N. Murray

The Scottish Himalayan Expedition, 1951

 

Saul

 

Business Planning Introduction

Jul. 13, 2005
Categorized in: Business Planning
Tagged with: business planning

 

Real estate professionals need to create a business plan. In addition, conducting business reviews will help you determine if you are "on plan."

 

As your business matures, your business plan will change. Your business plan should move you toward your business goals and your business goals will change for your business based on previous year's achievement and whether or not you are growing your business, maintaining your business, or preparing for retirement from your business. Your business goals should help you achieve your life goals...there needs to be consistency. Again, reviewing each year is very helpful. I had a partner in my real estate business and each year we shared our personal goals with each other as we prepared our company's business plan.

 

I am looking for information for an association on how to write a business plan for the real estate sales business. I thought we could take all the ideas we can come up with from this List and eProTalk, consolidate all of them, and then create an auto responder for anyone who wants the compilation.

Remember, YOU ARE A BUSINESS.

 

Here is some information to get the conversation going (with assistance from

http://bPlans.com):

A business plan is any plan helps a business look ahead, allocate resources, focus on key points, prepare for problems and opportunities, and achieve clearly defined goals and objectives. Many people think of business plans only for starting a new business. A business plan is also vital for running a business. Businesses need plans to optimize growth and development according to priorities. You establish the priorities as the owner of your real estate business

 

Start up business plan

A simple start-up plan includes a summary, mission statement, keys to success, market analysis, and break-even analysis.

Cash flow is vital to a business. Cash is often misunderstood as profit, and they are different. Profits don't guarantee cash in the bank. Lots of profitable companies go under because of cash flow problems.

Implementation details are what make things happen. Your brilliant strategies and beautifully formatted planning documents are just theory unless you assign responsibilities, with dates and budgets, follow up with those responsible, and track results. Business plans are really about getting results and improving your company.

 

So have at it...suggestions please. If you are willing to share your business plan, please e-mail it to me and I will make it available to everyone, by auto responder and maybe also on my blog.

 

Saul

Saul@SaulKlein.com

 

 

 

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