“Good fortune is what happens when opportunity meets with planning..” - Thomas Edison
The Dirty Secret and #1 Mistake With A Real Estate Agent’s Business Plan
The # 1 mistake, and dirty secret that no one is talking about it is that agents are told to write down a yearly goal.
Businesses plan, budget with, and work towards, monthly recurring revenue (MRR). Not what they will gross in a year. Businesses build systems to hit that MRR repeatedly.
The biggest misstep by agents in the real estate industry? The lack of a systematic approach to income generation. Real estate agents, driven by ambition, often set lofty annual goals without a concrete, month-to-month plan to achieve them. This approach is akin to setting sail without a map, hoping to somehow reach the destination.
The smarter, more effective method lies in focusing on Monthly Recurring Revenue (MRR). This concept, widely embraced in various business sectors, is completely overlooked in real estate as if somehow the principles of growing a business don't apply. MRR isn't just about consistent income; it's about building a predictable, scalable business model. It's the difference between chasing after sales and cultivating a steady stream of income.
Consider the agent aiming for a $100,000 annual income. Breaking this down to $10,000 per month not only makes the goal seem more attainable but also allows for the development of a targeted strategy. What does it take to earn $10,000 a month? How many listings, showings, and closings? What marketing efforts are required? These are the questions that lead to a robust, repeatable system.
The inconsistency in income that many agents experience is largely due to the absence of such systems. Without them, agents find themselves in a perpetual cycle of highs and lows, never quite mastering the art of steady growth. They jump from goal to goal, year after year, without ever building upon a solid foundation.
This systemic failure is not entirely the fault of the agents. It stems from a gap in the industry's educational and coaching frameworks. Many real estate training programs emphasize the glamour of big sales and the allure of hefty commissions, neglecting the crucial aspect of building a sustainable business model. It's a cycle of misguided aspirations, leading many talented agents to burn out or underperform.
A paradigm shift is required in how real estate agents plan and operate their businesses. It's about understanding that success in real estate is not just about the number of properties sold but about creating a reliable, scalable system that delivers consistent results. Agents need to be educated on the importance of MRR, trained in developing systems that support it, and encouraged to focus on month-over-month growth rather than just the year-end total.
It's time for the real estate industry to have a new narrative. One that champions the importance of Monthly Recurring Revenue, systematization, and sustainable growth. It's time for agents to move away from the unpredictable ebb and flow of annual goals and towards a more stable, predictable, and prosperous future. Know better, do better – this should be the new mantra for every aspiring and practicing real estate agent.
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