Increase your profits by cutting down on unnecessary waste and generating more business with these actionable strategies from trainer Bernice Ross.
Success in business is determined not only by what you decide to do, but also by what you don’t do. One way to increase profits is to do more business. On the other hand, you can also increase your profits by cutting expenses and avoiding time-wasting activities.
Most real estate agents are primarily focused on profit. That means how many leads you can get, how many properties you can acquire, and how many referrals you can generate from past customers and their range. What is commonly put off is that expenses and procrastination can cost you more money without you realizing it.
Sometimes the fastest way to increase your income has nothing to do with adding something new, but rather enhancing what you’re already doing or making it more efficient.
5 ways to grow your business and increase your profits
1. Increase the number of quality conversations you have each week
There is no substitute for direct contact. If you’re an agent, you should schedule an in-person meeting as soon as possible after acquiring a lead. In fact, NAR statistics show that agents who have the first in-person meeting with a seller have up to an 80% chance of getting the listing. Revenue starts with contact, especially when it’s face-to-face.
2. Increase average transaction amount
We don’t always need more deals, but we need better deals. That could mean moving up your price range, expanding into nearby market areas, or establishing a new niche (golf properties) based on your interests. Making small changes to your average deal size can often yield more profit than doubling your efforts for a cheaper property.
3. Build a repeat/referral system
Every completed transaction must sow the seeds for the next one. Referring one past client a year can change your business forever. Agents who consistently communicate with their clients often attract referrals simply by keeping in touch regularly. In other words, relationships grow more efficiently than advertising.
4. Improve conversions, not volume
If you only convert 10% of your leads, you’ll have money left over. Low conversion rates are usually the result of focusing on cold leads instead of working on your own territory and past customer list. In fact, nearly 55% of the deals we close each year are with people we know or are introduced by people we know. Therefore, spend most of your time and money on generating leads from people you know.
5. Add one complementary revenue stream
Agents may add first-time buyer, luxury, relocation, or 1-4 unit investor representation as new niches. You don’t need five new businesses, but just one addition that will work to expand your reach into markets you don’t currently serve.
5 ways to reduce waste and increase profits
1. Stop doing low-value tasks yourself
You may take pride in being a jack of all trades, but that habit can seriously hinder the income you can earn. Spending hours on tasks that others can competently complete reduces your earning potential. reason? You’ll spend less time running your business instead of running errands and tasks that waste your precious time.
Learning to delegate can be difficult, but the time freed up to grow your business and spend more quality time with your loved ones is worth it.
2. Eliminate expenses that don’t support your strategy
A simple step to reduce unnecessary costs is to stop “auto-renewal” on your subscriptions and other products. (You can also use a credit card that expires within the next 12 months.) It’s important to evaluate each product you pay for at least once a year to see if it’s still being used and if it’s still worth your money.
3. Stop chasing unqualified prospects.
Time spent trying to convince someone who never takes action is a drain on both time and energy. Be able to say “no” quickly. One strategy that has worked for me for decades is to ask, “Who is closest to the money?” That’s where the main focus will be.
Don’t allow psychic vampires to sneak into your calendar, sucking away your time (and money). Whether it’s during a transaction or how long you have to wait for a contractor to perform an inspection or fix a problem, your profits increase when your time aligns with the people taking action.
4. Reduce emotional reactions
Blaming the market, lenders, and other agents takes up mental bandwidth. That energy can be directed toward problem-solving. Emotional discipline keeps negotiations clean and relationships intact. Long-term income depends more on reputation than on a single transaction.
5. Stop waiting for perfection.
Perfectionism masquerades as prudence. Markets are never completely stable and every trade has flaws. The question is how much effort do you put into gaining enough confidence to act? Thoughtful action overcomes lingering hesitation.
This is the most important point. You can grow your business in both directions at the same time. Add one meaningful revenue activity and remove one consistent drain. There is no need for a dramatic overhaul. Instead, changing a few simple things can make a big difference. Profits can increase with both expansion and reduction. Successful professionals in this business have learned to do both.
March is Marketing and Branding Month at Inman. As the spring sales season begins, we examine the proven tactics and new innovations that are delivering results in today’s market, and celebrate the industry’s top marketing and branding leaders with Inman’s Marketing All-Star Awards.
Bernice Ross is President and CEO of BrokerageUP and RealEstateCoach.com, founder of Profit.RealEstate, and a national speaker, author, and trainer with over 1,500 published articles.
