A Smarter Way to Build Your 2020 Business Plan… And Make It Your #BestYearEver! – #TomFerryShow

November 19, 2019

What’s your goal for 2020?

[Buzzer sound.] WRONG!

Not to be harsh, but if you immediately started talking, you likely answered too quickly.

Let me explain: On today’s #TomFerryShow, I want to help you build your 2020 business plan and set your goals… and I want to do it smartly.

Too many people I encounter pull a number out of thin air when setting their goals… either an income amount or the number of houses they want to sell, but here’s the problem: It’s not based on the reality of their situation.

I have a better way. Keep reading…

Don’t Be Lazy. Be Analytical!

Before you start putting your goals in place, I strongly urge you to estimate these seven costly budgetary expenditures:

Business expenses
Operating expenses
Personal expenses
Debt reduction
Taxes
Pre-tax savings goals
Post-tax savings goals

That’s a big list, right?

The reason why it’s important to factor all of these in is because it really shows how much you need to earn to simply break even, cash-wise.

Now let’s take the next step…

Comparing 2019 Actual Numbers vs. 2020 Goal Numbers

A good place to start setting your annual goals is always to see what you were able to accomplish this year and then exceed that number next year.

However, that doesn’t factor in any special objectives you might have for yourself, so adjust accordingly if you plan to pay off your mortgage, dramatically increase your savings, or send a kid off to college, etc.

Here are categories you should examine for your 2019 results:

Sales volume
GCI
Post-split income
Lead sources & transactions
Buyers vs. sellers & average sales price for both
Average retained commission percentage (List side & buy side)
Conversations

Once you’ve determined everything you achieved in 2019, then tackle all of those same categories for your 2020 goals.

Make sure you get specific to obtain your 2020 income goals!

How Many Conversations Do You Need to Guarantee Goal Achievement?

Ready to get nerdy? Got your calculator handy? Good, let’s go!

Research shows that the “average” real estate sales professional requires 50 conversations to close one deal.

If you’ve been tracking and measuring your numbers, you know your own number. If not, use the 50 average.

Then multiply the number of transactions you want to close in 2020 by that number.

Let’s use 36 transactions as an example.

You’d multiply 36 X 50 = 1,800.

So you need 1,800 conversations in 2020 to achieve your goal.

And you need to spread them out throughout the year, so the next step is to divide that number by 10 months (Because no agent really works all 12 months in a year.)

So 1,800 divided by 10 = 180.

That’s 180 conversations a month.

Now, divide that number by 20 days, which allows for some breathing room and much-needed personal time.

180 divided by 20 = 9.

For the next step, it’s important to have an even number, so “round up” from nine to 10.

That means 10 conversations every workday will allow you to achieve your goal.

Does that seem like a lot? Too little? Keep reading for how to break down those 10.

Not Every Conversation Needs to Start from Scratch

Whatever number you calculate for your number of conversations per day, half of those conversations should be proactive, unsolicited calls to people in your database. These are calls where you do what you do best… check in, catch up, nurture them, keep those relationships tight, maybe ask for a referral, maybe not, and ALWAYS provide value.

Then the other half should be new people. These might be online leads, purchased leads, people you met at an Open House over the weekend, etc.

Don’t overlook your important follow-up calls, too: Make sure to conduct four lead follow-up conversations every day.

Then let the compound effect run its course.

Every day that you have these conversations is like pushing forward another pebble on top of a snowy peak. You’re gradually building momentum that will one day grow into a giant avalanche barreling down the mountain. That’s why it’s important to make these calls part of your daily routine… to build that momentum so that you’ll soon be unstoppable.

When & Where Will These Conversations Take Place?

Now that you know how many conversations you need to have on a daily basis, let’s examine how you will make them happen. Answer these questions:

How many phone prospecting sessions/Hours of Power will it take you to achieve your number of conversations?
How many Open Houses do you need to do to meet the amount of new people you need to speak to?
How many listing appointments do you need to get the number of listings you want in 2020?
How many initial buyer consultations do you need to work with all the buyers you want to help purchase their dream house in 2020?

A couple key reminders:

First, always overestimate these numbers rather than underestimate what it might take to get you there.

Second, if you’re not doing it already… Make sure to track and measure everything you do so you create real data points for 2021, 2022, etc. When you know your numbers, your business becomes more predictable, more productive, and a whole lot more fun.

Let me know what questions you have or challenges you’re facing heading into 2020 in the comments below!