KWcommand Goals will allow you to create a real estate business plan for achieving a certain amount of real estate production-based on numbers you enter into the system. Over time, as long as you use it, and enter all of your activities such are real estate leads, appointments, and sales, it will begin to use actual numbers for your personal conversion rates and will provide insights custom to you.
Video Tutorial [45-Minutes]
Start from your home screen or the reports module. Click the link to access the Kelle Guide.
- Choose the year for which you want to set your real estate goals.
- Enter the year you are planning for
- Enter your Annual Profit Goal
- Enter your Average commission
- Enter your annual expenses
- Enter the balance of your business that is between buyers and sellers
- Enter your Conversion rates
Annual Profit Goal
I say, put in the number you actually NEED to live on plus a bit more. That way, if you aim a bit higher, you are more likely to hit the NEED number. I don’t like overshooting on these numbers as then it’s harder to truly move levers in my opinion.[Activities are a particular lead generation source.
- Smart Plans
3% is a good estimate when you are tracking lead gen numbers from the web, calls, door knocks, etc.
Over time, this will auto-populate from your numbers recorded in opportunities.
If you don’t know your average commission, check the opportunities tab. You can use your commission from closed opportunities.
To find an average: Add up your total GCI and divide it by the total number of transactions.
GCI / # of Transactions = Average Commission
If you have a team, you would calculate the total commission of the team here. You’ll subtract the agent side in the cost of sales.
In this MREA business planning guide, you can see general lists and descriptions of operating expenses and cost of sale.
You’ll enter your operating expenses in one box and the cost of sale in the other.
Cost of sale: royalties, cap, agent commissions on your team, referral fees.
Some agents simply count the commission after the referral fee is deducted, others count it and list the referral fee in the cost of sale.
A cost of sale is usually connected to a single transaction where operating expenses are recurring and part of doing business as a whole.
This is your bottom line profit after expenses.
Commissions – COS – Operating Expenses = Profit
It’s the amount of profit your business earns before taxes and after cost of sales and operating expenses from your GCI (Gross Closed Commission).
According to MREA, COS is the amount you pay agents on your team in addition to referral fees, fees paid to your company (split, cap, desk fees, etc.), and any additional royalties you pay to be associated with a network (such as a franchise fee).
Operating expenses are your day to day costs of doing business. These are items such as:
- Office Supplies
- License Fees
Leads and Contacts
In this case, Leads are what are “captured” and contacts are people that are actually viable conversations to move through the pipeline.
It’s reversed for many of us based on what we learned.
Now, from the point of the leads becoming contacts, how many appointments do you think you will set?
Figure in some sort of fall out. Some of those appointments will change their mind or situation and not move forward.
How many agree to work with you? This is generally done with a listing or buyer representation agreement, although the buyer side is frequently verbal.
How many of these homes are put into a sales agreement?
From the point of the sales contract, how many make it all the way to and through closing.
Review Your Goals
You now have a business plan that tells you exactly the number of activities that need to occur to achieve your goals.
This is your LEAD GENERATION domino. It’s the one thing that controls the rest of the plan.
If you don’t do the activities, the math won’t play out on anything else.
This is your #1 thing!
Now, in reports, you can view each phase and monitor your projected goals over you actual goals.
This is going to give you insight as to what’s working well and to where there is a weakness.
Remember, the ACTIVITIES is first for a reason.
Your conversion rates and math will begin to adjust as you enter your activities, leads, contacts, and opportunities in all phases and stages.