OPENING THE DOORS TO YOUR NEW BUSINESS

Opening the Doors to your New Business

With so many real estate people taking the opportunity to obtain their AREINZ qualifications we expect to see a great supply of people who are candidates to either open new businesses or acquire existing ones as the current owners decide to move on.

Opening a new office, whilst it has its challenges, is an exciting prospect and this month I would like to discuss the more human and practical issues. There is an excellent resource of advisors on the legal and financial aspects of opening a new real estate office and these should be properly consulted before taking the first steps to open.

So what needs to be considered before opening your new business?

1 Why are you doing this?
No doubt you have already written out your personal goals and already have a very clear picture of where you want to be in a few years and what your life will be like. Having a clear set of personal objectives will assist in two major ways;

• Providing a sense of purpose and direction to keep you working at the pace required to be successful.

• Confidence that this is the right thing to do and so you can take your exiting skills and knowledge and apply them to a higher purpose.

2 Your business Philosophy
Whether you are buying an existing business or opening a new one you need to get really clear on your business philosophy.
Are you joining a franchise group, a marketing co-operative or launching your own brand as an independent?

The business types currently on offer in real estate seem to run from a warehouse or supermarket approach, to the boutique or delicatessen model.

Are you going to offer the full suite of marketing options or do you want to specialise in a particular marketing strategy? What’s your marketing approach?
Company funded or vendor funded?
Are you going to be the familiar corner store operator with huge window displays or are you going to be upmarket with a funky image?

3 The market you want to work?
Have you researched the area you are looking in?
Does it provide ample opportunity for you to build the business?
Who are the opposition and what are their strengths and weaknesses?
Are you comfortable working with the people and product this market contains?
What are the trends and are their any socio-economic and demographic changes coming that you can take advantage of or prepare for?

4 How do you want your business to look?
To continue from above and the question about your business style, have you made a decision about your quality level? Does this quality level match the type of market you want to enter?
Are you going to establish a look and feel for your business that will attract a sales team and clients?
What’s the reputation you want your business to have?

5 How will you brand and market your Business?
Have you considered a marketing plan and does that fit in both the market you are entering and with your business philosophy. Consider the look and feel of all the visual material you need and build a flavour or look for your business. Will you go for the quality and full-service style or will you take a more typical approach? Will this approach attract sales people and clients in this market place?

6 What will your role be?
The management and ownership hat is very different to that of a salesperson.
What will your key role and responsibility be in you r new business?
What new skills do you need?
What current activity and behaviour will need to stop?
What new activity and behaviours do you need to adopt?
Who will help you?
What are the key tasks of great managers and what are the common mistakes most managers make?
Can you drop some of the sales person’s habits and become the inspirational, fair and decisive leader that good real estate teams need?

7 What do you expect from your team?
Once you get clear on the issues above you can start to build a picture of the sort of sales people and administrators you need. All the above start to provide a clear set of characteristics of the type of people you want and the skills and qualities you want them to portray. If there is anywhere where you see a break down between the ideal business picture and the eventual reality it often happens here first. Recruitment of good people in real estate is very competitive and in the urgency to fill the office compromises are all too often made and the path to the office you really want gets very step. This is often the first place where your commitment is tested.

Consider your Human Resource Management and how you will ensure that your team know what to do and how to do it.
How will you handle team members that can’t, or won’t, perform to your minimum requirements?

8 What resources will you need?
This ideal business will require the right resources to deliver the outcomes you are expecting.
What administration people do you really need?
Do you need a Marketing department?
Will your technology resources be adequate?
Office space, training rooms, parking, Auction rooms, photocopiers and printers are all issues you need to ensure will allow the business you want o develop.
They reason to ensure you have the right resources is to remove the possibility that any team member can blame the lack of tools or poor tolls for their poor performance.
Create an environment where success is easy and team members accept greater responsibility for their performance as they can’t blame you.

9 Have you a timetable and checklist?
Leave nothing to chance. Work with your professional advisors to cover all your bases. There is nothing more frustrating than fighting a rearguard action on opening day because something has been overlooked.
Make sure your timetable is realistic and

10 What’s the budget and available working capital?
There is nothing like the confidence of having enough working capital to create both the right environment to establish your new business and having the funding to operate until the cash flow arrives.
Have you costed the exercise realistically? It always costs more! Prepare a budget and cash flow forecast and get really clear on the prospecting, listing and sales activity required to exceed these expectations.

Whether buying an existing real estate business or opening a new one, you will find it an exciting, but demanding time . Before you go following the Opening an Office Checklist and ticking off the tasks listed take a moment to ask your self the questions above and make sure you are ticking off the actions that will build the business that you want.