In commercial real estate brokerage, you need a lot of ongoing encouragement as an agent or broker. Anything that you can do to help you improve performance in commissions and listings is a good thing. The pressures of the working day will create diversions and issues that can threaten your prospecting and client contact times. When that happens you lose traction in the market.
The best property agents stay on track with essential tasks, and will not let anything cut across important processes and business building efforts. It would be a good idea to have a look at your results over the last week and just where you are headed in the next week.
One thing that can help you a lot in this planning and focus is to have a ‘Victory Log’ or ‘Goals Chart’ where you can see how you are tracking and improving in important issues. I go back to the point that encouragement and improvement are big parts of our industry.
Create Your Goals Process
To build your ‘chart’ in this way, try monitoring and charting the following issues on a weekly basis. Each Friday you can enter your results from the week past and see how you have achieved in key areas.
- Cold Calls made – When you consistently make lots of cold calls you will find things to work on. Perhaps a relationship can start with new property people, sellers, buyers, and tenants. Set a target of talking to at least 20 new people every day and start that process through cold calling in a consistent way. Our industry is one of personal contact so as a daily process connect with more new people.
- New Meetings created – Calls lead to meetings if you do it the right way. The ‘door knocking’ of the local business community will also help you find new people. On a daily basis set a target to connect with 2 new people in a meeting or presentation.
- Prospecting letters sent – I am a great fan of sending prospecting letters and marketing material by mail, given that most things today are sent by email and are usually deleted faster than you can believe. The traditional mail service with a well-crafted letter and business card enclosure will help you make successful cold calls to those people in the next few days after the letter is received. Develop a system of contact where you can send 5 of these letters per day and follow them up over time.
- Presentations made – You can split your presentations made into both ‘successful’ and ‘unsuccessful’ so you understand your conversion factor. A good agent will be converting listings at a rate better than 75%. At the other end of the scale a new agent to the industry will be struggling with presentational skills and relevance, so their conversion factor over time is likely to be only around 40%. The idea is to get the conversion factor to improve.
- Listings created – Split your listings converted into ‘open’ and ‘exclusive’. The listings that really matter are ‘exclusive’ and your focus should be to work with controlled listing stock in that way. If you control the listing you control the marketing and the client. At least 90% of your exclusive listings should be converted to completed transactions, and to achieve that you will need to structure vendor paid marketing and good promotional campaigns.
- Inspections undertaken – If you are marketing your properties effectively and comprehensively, then your inspection numbers should go up. Track the numbers of inspections you have each week with all of your exclusive listings. Open listings can be tracked but they are not controlled stock and are likely to be more difficult to inspect or convert.
- Contracts written by price per transaction – When you track your contract price per transaction you will soon see the benefit of working with larger deals and higher quality properties.
- Leases written by rent per transaction – The same rule applies with leases. The better the quality of properties and premises to lease, it is easier to attract good levels of commissions and the deals will be easier to close.
- Commissions written – Contracts and leases lead to commissions. As part of your personal business plan you should have targets relating to commissions. Each month and each quarter you can adjust your marketing efforts with quality listings so you are improving your enquiry rates and inspection activities. The formula in commercial real estate is quite simple. Work with good quality properties and things will be easier for you.
- Vendor paid marketing – Most if not all exclusive listings should be supported by vendor paid marketing funds. Each week run a tally on marketing submissions written and presented, and then track your numbers on completed and paid vendor paid marketing funds. You will soon see that there is a direct relationship between marketing funds paid and inspections; that then leads to better sales and leasing enquiry and commission conversions.
So you can see why these numbers are important to track as a commercial real estate agent. When you know how things are going for you each week, you can see where adjustments should occur. Improve on your strengths and resolve your weaknesses with training or extra resources.