Explaining the equivalent of savings in business.

In our personal lives it is a good idea to create a savings plan for rainy days but in business, the idea is to invest to earn more than you spent, making savings pointless. But there is another version of savings in business. Mark Burgess explains.

Explaining the equivalent of savings in business.

As we grow up most of us are taught the importance of putting a little of the money you earn aside for a rainy day. As we get older, and our income increases this becomes the norm for many people as the idea of retirement starts to become something worth thinking about.

Although I often read agents talking about how they are making a saving by not using certain portals etc, this process of ‘saving’ does not apply to business. Your business will not need support through its retirement as it will only retire when it is closed down. Until that point its purpose is to make more money than is invested into it. As an example, if investing £x into a certain portal pays back £x + £1 then it is a good business move.

Of course if you have limited funds to invest you will want to ensure that you are allocating that spend into the things that give the very best return on your investment so reallocating funds that may have been spent on a portal to something that is giving a better return on that investment is a wise move but just ‘saving’ the money is pointless as the business does not need ‘savings’ (this is different to you taking that money as income and creating personal savings). Of course, it is nice to have a float in the company to ensure you can manage cashflow but there is no point in just saving for the future of your business.

However, there is something that all businesses should be doing that works the same way as they way in which we are taught to think about planning for our personal future. So how do businesses plan for the future of their business to ensure life gets easier for them over time as opposed to harder?

The answer actually lies in a term that you as Estate Agents are already very familiar with, a pipeline.

But not a pipeline in the sense that you currently think of it for example, SSTC on its way through to completion. No, this pipeline should be one of long-term new business.

As we know the housing market will always go through good times and bad and during the good times it is tempting to just get on with doing as many sales as is physically possible without much further thought. But this is the equivalent to just spending all your wages each month forever and then getting to retirement and thinking ‘whoops’!

While in a busy market your business will have so many interactions with people that end up not moving forward with their property sale or purchase for one reason or another and in a busy market it is easy to ignore them as moving on to the next deal is quick and easy to do. But ignore these people at your eventual peril.  Of course, you do not have time to do anything with those people not ready to move currently, but in today’s world that is the job of your CRM, after all CRM does stand for Customer Relationship Management.

Back in 2015 Google wrote a whitepaper called the zero moment of truth, that showed that customers are gained by exposing them to 7 hours of content and them seeing your brand in 4 different locations 11 times. So, all those people that gave you their details, that have properties to sell but are not currently ready to move should be stacking up in your database during busy times. Your CRM should then be automatically communicating useful, engaging, or educational content with those people across email and social media, building a pipeline for you for the future. This becomes your ‘savings’ fund.

The longer you are in business, the bigger your ‘savings’ pot becomes and when those bad days come and your competitors are scratching around wondering where their next meal is coming from, you have direct access to the data of all of the people that are in your listings pipeline, your CRM has and continues to ‘7-11-4’ them and on top of that it automatically shows you who of them has recently been interacting with your brand online from looking at your website or reading your content via email or on your social media, allowing you to go straight to the best opportunities even when the market tightens up.

Lifesycle is the world’s only CRM to combine those functions above with the functions of a more traditional Estate Agency Software allowing agents to do their everyday work in a modern way on any device whilst automatically taking care of your long term prospects for the moment you need to get a little more proactive, which is why so many agents are switching over to this new way of working and have already started building their savings pot for the future.

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