How to create a business plan in 7 easy steps.

Posted on August 19, 2015 by Michael Burnstein, One of Thousands of Life Coaches on Noomii.

Building your
Business Plan in 7 Steps

Step 1
Recognize that YOU are a business!! AND SET GOALS.
You may enjoy your life as a Real Estate Professional – GREAT. And to be efficiently profitable – it is useful to look at what you are doing – what is generating income?

In order to succeed, it is imperative to have a quality business plan in place.
A useful tool is a SWOT analysis (Strengths, Weaknesses, Opportunities and threats), check out my website to have access to this tool.
A good place to start is to set goals for the year: how many sales, how much income (in different areas), how many listings????

Step 2
Write an executive summary that sums up your mission, your service, goals and significant achievements such as awards. Take time to consider your mission and service, focusing on the unique attributes you offer the real estate profession and to your clients and customers. This section also includes a description of your work facilities, equipment and employees if you have an assistant.
I use my mission as a litmus test to check if I am on track, for example: is sitting open house serving my mission?

Step 3
Conduct a market analysis in which you define the people who will buy or list their home with you. Identify your market demographic such as age, gender, socio-economic status and other characteristics. Also consider their home-ownership status such as first-time home buyer or down-sizing seller. Once you have your market defined, identify the media outlets your market reads or watches to determine the best places to promote your real estate service. Finish up by outlining what types of marketing strategies you will use, such as advertising in local real estate magazines, offering seminars, social media, creating a website or blog and other tactics that target your market.

Step 4
Analyze your competition. Study other real estate agents in your office and at other firms to identify the similarities and differences in areas such as target market and marketing strategies. Use this information to determine how you can set your real estate services apart from the other agents in your area. AND – for the agents you most respect…COPY THEM!

Step 5
List the management team of your real estate business such as your broker or partner if you work with one. Give their names and information including their skills, experience and education as they relate to helping you build a successful real estate business.

Step 6 – HUGELY IMPORTANT
Outline and ANALYSE your daily business operations. Detail the day-to-day activities required to manage your real estate business. Identify who is involved in carrying out and making sure the activities get done. This step, perhaps with step 7, is the most important step. There are many approaches to this, here is what I recommend if you are starting out or wanting to refresh your business: (effectively this is creating the marketing plan)
Answer this question: how much do you want to make this year?
Break this down (how many sales, what is your average commission, any property management income, based on what you know – how many buyer rep sales, seller rep sales, any income from investing, flipping???? more detailed the better).
For each income area, write a list of the ways you market your self (open houses, mail outs, social media, blogging, sitting floor time, email news letters etc)
If you have this information: look at how many leads/sales you get from each of these sources. For example: when I was an agent, I would estimate that for every listing I got, I got, on average, two sales: the listing and another sale from holding open houses (either by getting another listing or by getting a buyer to work with me and buy a different home). Another example: I used to “farm” 2000 homes in the area I worked. I would mail to them 4-6 times a year. At the end of the year they got a 7 page letter from me (with market stats etc). This letter would generate on average 6-10 inquiries. Which would generate (on average) 2 or 3 listing appointments. Generating approximately 2 listings. Generating 4 sales (combined with sitting open house). My average commission was about $8000 at the time. So this mail out (that cost approx. $2000 and be a mountain of work for me!) would generate approximately $30,000 of commissions).*1
If you don’t have any information like this – get as much as you can from other realtors in your office.
Once you have this gathered – USE IT. Is sitting open house worth it? is sending mail outs worth it? Is spending 3 hours a day on social media worth it? What is the best combination of your time?
Eventually you should have a daily schedule of marketing “to do”s.

Step 7
Provide the financial details of running your real estate business. Give a financial statement that shows current cash and assets, as well as expenses and liabilities. Calculate projected income and expenses over the coming year. DETAIL HOW INCOME IS EXPECTED TO COME IN HOW MANY SALES? JUST FROM SALES? RENTAL MANAGEMENT? REFERRALS?
EXTRAS
Add an appendix for supplemental documents or material not included in the main part of the business plan. Use this section to include a copy of your real estate license and other designations such a broker, brochures and other materials.
Compile all the sections together into a single business plan document. A business plan is not a static document that is created and filed away. Instead it is a guide that can be changed as needed to help you stay focused on building a profitable real estate career.

*1 All these dollar figures are VERY approximate – they are taken from memory, I have NO statistical evidence to back them up!!! Do NOT rely on them :-).