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Real estate agents are often great at making money and not as good accounting for it and keeping it. Nor, are they intentional in where their money is spent. I have with me today, Eric Johnisee, owner of Drive Accounting who helps real estate agents be great with their money
Show Notes
So, you hit the nail on the head. You know, over 80% of the businesses that I run into are exactly like what you mentioned. I was exactly like what you mentioned, very entrepreneurial out there doing a lot of the business and not focusing on the back end of this and I got myself in trouble that way and I had that paradigm shift. So yeah. For me and the businesses that I work with it is paying attention to your numbers and that can mean a lot of different things depending on who you're talking to. For me, I pay attention to where my business comes from. It comes from who were my best referral sources. Is it different networking groups. Is it websites? Is it something else, etc. Figuring out where my new clients are coming from, figuring out if they have worked with me over time and things like that.
The second thing I track when it comes to my numbers is that I'm also revenue based. I pay attention to what types of services. For us, it's controller work or consulting or bookkeeping. And is it a bookkeeping cleanup or bookkeeping maintenance or is it some of the other ancillary services.
For real estate agents, is it buying, selling, referral? Is it commercial or residential? You can break this down quite a bit as far as where the business comes from. Does it come from Zillow? Did it come from referral? Did it come from a past client? Things like that. So splitting revenue is a big one. The other part of paying attention to your numbers is simple budgeting, figuring out and making a plan. So number one thing that has helped our business grow is that we do everything in our business with intentionality. We don't do anything by chance.
If you're doing something in your business, you should know why you're doing it. There's the old turkey or the old Christmas ham analogy where the girl asked her, mom, "Why do we cut the ends off the ham?" He says, "Well, I don't know. We've always done it that way." So they go talk to mom, dad and grandma and they say, "Well, you know, my mom always did that and let's go ask her if she's around." She says, "Oh, well, when I was growing up, the pan was too small. So my mom used to always cut off the ends." So it went through four generations and we keep doing the same thing over and over, and we don't know why. So, paying attention to why you're doing things, which for me is I follow that up with all of my spending. So we create a spending plan, we figure out our budgets, and that doesn't mean we always stick to it, but we know what our plan was.
So now I can see what am I spending on advertising per listing. What am I spending for meals or client acquisition, things like that. These tools and managing that money wisely gives you more. At the end, you're managing it better. So it, it helps when you're paying attention to your numbers. You're not driving blind, you're not going somewhere, you haven't gone without a map or a GPS. You're paying attention to this regularly.
So those two things, at the base level for taxes, keep things separated. On the other level, pay attention to your numbers and figuring out what those numbers are and acting with intentionality. Those are the two biggest things that I've found for any business, but especially real estate.
Perfect. I love it. So, again, keep things separate and then also know your numbers and you gave us some great examples there of what the possibilities are with that. You could actually say, this past year I earned this much from my sphere and I spent this much on my sphere, therefore my ROI on my sphere is 'X'. Boy, I ought to spend more on my sphere or grow my sphere further.
The second thing I track when it comes to my numbers is that I'm also revenue based. I pay attention to what types of services. For us, it's controller work or consulting or bookkeeping. And is it a bookkeeping cleanup or bookkeeping maintenance or is it some of the other ancillary services.
For real estate agents, is it buying, selling, referral? Is it commercial or residential? You can break this down quite a bit as far as where the business comes from. Does it come from Zillow? Did it come from referral? Did it come from a past client? Things like that. So splitting revenue is a big one. The other part of paying attention to your numbers is simple budgeting, figuring out and making a plan. So number one thing that has helped our business grow is that we do everything in our business with intentionality. We don't do anything by chance.
If you're doing something in your business, you should know why you're doing it. There's the old turkey or the old Christmas ham analogy where the girl asked her, mom, "Why do we cut the ends off the ham?" He says, "Well, I don't know. We've always done it that way." So they go talk to mom, dad and grandma and they say, "Well, you know, my mom always did that and let's go ask her if she's around." She says, "Oh, well, when I was growing up, the pan was too small. So my mom used to always cut off the ends." So it went through four generations and we keep doing the same thing over and over, and we don't know why. So, paying attention to why you're doing things, which for me is I follow that up with all of my spending. So we create a spending plan, we figure out our budgets, and that doesn't mean we always stick to it, but we know what our plan was.
So now I can see what am I spending on advertising per listing. What am I spending for meals or client acquisition, things like that. These tools and managing that money wisely gives you more. At the end, you're managing it better. So it, it helps when you're paying attention to your numbers. You're not driving blind, you're not going somewhere, you haven't gone without a map or a GPS. You're paying attention to this regularly.
So those two things, at the base level for taxes, keep things separated. On the other level, pay attention to your numbers and figuring out what those numbers are and acting with intentionality. Those are the two biggest things that I've found for any business, but especially real estate.
Perfect. I love it. So, again, keep things separate and then also know your numbers and you gave us some great examples there of what the possibilities are with that. You could actually say, this past year I earned this much from my sphere and I spent this much on my sphere, therefore my ROI on my sphere is 'X'. Boy, I ought to spend more on my sphere or grow my sphere further.
Creators and Guests
Host
Justin Stoddart
What is Think Bigger Real Estate?
The road to success for real estate agents is well-marked. The road to significance is not. Here, we help you to Think Bigger than just your business. We inspire you to seek success AND significance, income AND impact. We do that by interviewing the biggest thinkers and highest achievers in the real estate industry, extracting the secrets to having it all.