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This article was last updated May 23, 2023.
Comfort can be lethal to your business if you’re not careful. In life, either you’re growing, or you’re dying. Growth and comfort can not coexist. Comfort can often lead to complacency, which almost always leads to a declining business.
Sometimes those comforts that we get used to can start to deteriorate our lifestyle, our life, our health, and everything around us. If you’re comfortable in these five areas, it might be a foretell that your business will decline.
1. The comfort of a good market
Good markets have a way of making us look better than we are. But difficult markets tend to make us look worse than we are. We are on the backside of two years where we experienced one of the hottest real estate markets ever.
The past few years have, in many cases, blinded agents to the fact that the next few years in real estate will likely be more difficult than the previous couple of years. Some agents do not realize that they need to adjust until it is too late, but your recognition of changing market conditions provides you the opportunity to make changes.
The key to overcoming the comfort of a good market is continuously growing yourself and your business knowledge. Become a student of what agents in other markets are doing in this new challenging market environment to make things happen.
How are they creatively putting deals together while other agents wonder why they can’t make things work like last year? Are they coaching sellers to offer closing cost credits to provide buyers the opportunity to buy down their interest rate? Are they hosting more open houses or going all in on video marketing for listings?
Don’t let the comfort of a good market keep you from growing your business. Stay humble, hungry and open to modeling your business activities after others finding success in the current market.
2. The comfort of past success
The comfort of past success can lead to an ego that tells you success and continued business growth will automatically happen. Nothing could be further from the truth. What brought your past successes will not take you to the next level in your business.
In times of frenzied markets, like we experienced the past couple of years, success can seem to come easy. But during normal to challenging market times, success comes through planning and execution.
- Do you have a clearly defined set of goals for your business?
- Does it involve measurable daily, weekly, and monthly activities that indicate whether you are on track or not?
- Do you track the number of real estate-related conversations, appointments and other leading indicators of future success?
The best way to combat the comfort of past successes is to set your goals for 2023 now and start executing them immediately. Real estate works on a 60- to 90-day cycle, so in other words, the activities we do today result in sales 60 to 90 days from now.
Most agents coast during the fourth quarter of the year, which is why cash flow issues for agents mostly occur in January and February. Don’t rest on your past successes. Develop your plan of action, and begin to execute it now to ensure continued success in the future.
3. The comfort of a large database
It is not the size of your database but rather the depth of your relationships that determine your future successes. There can be comfort in knowing that you’ve built a large database, but unless you consistently add value to the people in your database, it is of little value.
Many agents rest on the belief that because they’ve amassed a large database of people, they will generate business simply by the sheer size of that database. The belief that you can simply tap into the database at any time and transactions will fall out is naive.
The beauty of a large database is that even if you’ve been inconsistent in the past, you can begin now and develop a plan to consistently add value in a way that will deliver opportunities for business. This plan should include multiple touch points every month.
The plan’s foundation is that every member of your database receives daily, weekly or monthly property updates regarding the one they own or the one they would like to buy in the future. You should have a weekly or monthly newsletter sent to the entire database, and nurturing emails that discuss your community or upcoming community events. There should be check-in phone calls and text messages every few months.
By developing a plan of action with consistent communication to your growing database, your business will continue to grow.
4. The comfort of one lead source
This business is in a constant state of change. If you’re building your business through one lead source, then your business is at risk — not if, but when that lead source dries up or becomes less effective.
Imagine the agent with unlimited short sale leads in 2007 still depending solely on short sales to generate business. Imagine the agent that could generate as many quality leads as he wanted through Craigslist posts in 2014 or very targeted 2018 Facebook ads (with targeting at that level no longer allowed today) still attempting to grow her business only through these strategies.
Do you believe that the one lead source you have today will be as effective as it is today, forever? How long has it been since you tested a new lead source? Diversification of lead sources is critical for long-term success.
I suggest having four or more different lead sources for your business at a time. Think of your business as a table and your lead sources as legs for the table. The more legs on the table, the more stable the table will be. It is the same way with lead sources. The more sources of leads you have, the more stable your business will be.
5. The comfort of more money than you’ve ever had
The past few years were an incredible time to be in real estate with record numbers of sales and record high sales prices. You may be reading this with more cash in the bank than you’ve ever had. Having that cash on hand is a good thing, but don’t let that comfort of cash lull you into believing your financial situation cannot change.
When we make more money than we’ve ever made, we tend to upsize our lifestyle. That means your mortgage payment, car payment, and overall living expenses are moved to a higher monthly carrying cost. But what happens as the market changes and your income is less this year than it was last year? The second your expenses are more than your income, financial storm clouds are on the horizon.
Adjust your finances back to positive cash flow as early as possible. Either reduce your expenses or find ways to increase your income. Make sure the comfort of having more money than you’ve ever had has not turned into a sense of false security that your finances are bulletproof.
Enjoy the fruits of your labor, and celebrate your successes, but never let your comfort rise to a level that leads to future pain. The success you’ve enjoyed in the past is still available today. Continue to grow yourself, and your business can’t help but follow.
Jimmy Burgess is the CEO for Berkshire Hathaway HomeServices Beach Properties of Florida in Northwest Florida. Connect with him on Instagram and LinkedIn.
