Tuesday, December 3, 2013
Wednesday, April 3, 2013
How to create a Lease Option business
How to create a Lease Option business
In order to create a Lease Option business you must treat it LIKE it is a business. That means that you must remove emotion from the equation and look at every house with a regard to ROI (Return on investment).
How can you do that?
1) Create a huge funnel:
A funnel is a great way to automate your business so that you are continually having properties to look at. You want to have people contacting you, rather than you contacting them. (It is much easier to negotiate with someone that has called you, they have already taken the first steps.) Here are a few ways to create a funnel.
You need to find owners that have problems, and are motivated, AND have the circumstances that allow you to lease option their home. You need to find tenant buyers that can qualify to purchase a home in two years. The more prospects that you have in your funnel, the more deals you will have. You must ALWAYS be marketing.
a) Business cards: hand them out to everyone. You should have a tagline, plus contact information. If you don't pass out 20 business cards a day, you aren't working at it.
b) Internet: have your own web site. If you don't know how to create one, go to www.wix.com and make a free web site.
c) Ads: Place ads in Craigslist.net, any other community bulletin board, and any other discussion board. Put little ads in apartment complex's laundry rooms, restaurant bulletin boards, and any place that you can put one up for free.
d) Fishbowl: Buy a fishbowl at Wal-mart for $5, and ask business owners if you can put a fishbowl on their counter. People that are interested in Lease optioning their house, or need a house to lease option, can fill in the entry form, and the winner of the weekly drawing will get a (whatever the business owner sells) at the end of that week. (If they are a restaurant, the winner gets a free meal, PAID FOR BY YOU). Always think of how it benefits the other person; most people will operate from a selfish self interest perspective, and you can usually deal with that.
e) Bird dogs: Every time that you go to a nice restaurant, ask the waitress if she ever hears anyone that is looking for a house. If she will call you AND THE PROSPECT DOES BUSINESS WITH YOU, you will give the bird dog $50. (Give them your card, get their contact information, and follow up with them every few weeks. It never hurts to send an email telling them another person just got $100 last week, just by keeping their ears open. Waitresses, pastors, basically anyone that gets a lot of people contact is in a position to be a bird dog. What's in it for them? $50 in cash if they put you in touch with a person that you do business with. (Since you only pay the bird dog AFTER you have gotten paid, you have an unlimited advertising budget for this. When you pay based on production, you have a HUGE budget.)
f) Social media: Do you know those people that are constantly using Facebook, Twitter, etc...for a social media billboard? Yeah, you need to do that too. Be entertaining, be charming, be interesting, but always be closing.
g) Be a subject matter expert: If you can write a column for a local paper, using your knowledge...do so. You might have to pay a little bit of money for the right to write the column, but it elevates your credibility. If you can arrange to do seminars teaching young couples how to prepare to get into a house, and present this at local churches, universities, or ANYWHERE that will let you speak, you will elevate your credibility, and people will believe what you say. (So, don't lie.)
h) Join a real estate investment group. When we created FRAREI (Front Range Association of Real Estate Investors) in Colorado Springs, we had meetings at our mortgage brokerage offices. We allowed OTHER MORTGAGE BROKERS to speak, we had subject matter experts, we provided free food and drink, and we provided free space for the meetings. This allowed us to network with other real estate investors. If we found a deal that didn't meet our parameters, we would wholesale it to the group.
i) EVERY person that you contact is a potential bird dog. Treat ALL of them with respect, let them know your business model, and ask for their help. If you can't help them, but might be able to help a friend, if you originally treated them with respect, there is a very good chance that they will give you a referral.
j) Follow up. Every person that you have ever done a deal with, OR talked to should get a card at least four times a year. (Birthday, anniversary, Christmas, and Fourth of July) Create a contact list and write down a little paragraph about each contact. When you follow up, you will see a connection between you and the contact. If you nudge them, every couple of months, asking if they know anyone that needs help, and offering to give them $50 if they refer someone to you that you can help, you might just start getting more referrals.
k) Reward your bird dogs/contacts with an appreciation day. We had a HUGE appreciation day for our past clients at a putt putt golf place. We gave them free hot dogs, and golfing for the day. If you do this correctly, they will think that you are the greatest guy in the world...and you will get more leads.
l) Make it a contest. Who can give the most leads in a month? Grand prize is....
a) Have a quick filter:
You must get to the point where you know what a property is worth, and can look at it and say "no" in less than a minute. If it takes more than five minutes to say "no" to a property that obviously doesn't meet your parameters, you have taken too long. On the other hand, you can take your time on people that might be motivated. A "yes" might take days to decide on, because you have to talk with the people, and determine their level of motivation. (Also, if it doesn't meet YOUR criteria, can you get it under contract, and assign it to someone else? Could you use an extra $5,000? If so, be aware that someone might just want it. Having a large database of fellow investors that can use a good deal, and being willing to assign a contract to them, makes every opportunity golden.)
2) Know the value:
Go to www.eppraisal.com, www.bofa.com, or zillow.com to get a free property valuation. You can also go to the neighborhood, drive around, and every house that is for rent, or for sale, you can call up and ask the 5 "How" questions. (How old, how big, how many bedrooms, how many bathrooms, how much). It gives you an indication as to the values. they might be asking for more than the market is showing, but if you get enough indicators...that is the market. Also ask how long it's been on the market. If a property has been listed for more than three months, they might be desperate and motivated. There must be a spread between what the property can be purchased for, and what it can be sold for; there must be a spread between your outgoing lease payment, and your incoming lease payment.
3) Learn how to negotiate:
If you have never been to a negotiating class, go to a flea market and negotiate on items. If you are looking for a seminar on negotiating, contact me at: master_negotiator75@yahoo.com for more information.
4) Learn how to write a Lease/Option agreement:
If you don't know how to write a lease/option agreement, find a lawyer that can create one for you, and then just use that as a template. (A good agreement will have all of the boilerplate that protects you, plus be so simple that all you have to do is fill in the blanks.) If you need to know the clauses that will save you three months of payments, allow you to walk away from a bad deal, and have the purchase price be the declining mortgage balance, contact me at: master_negotiator75@yahoo.com .
5) Be willing to walk away from a bad deal:
If you have a large enough funnel, you will get a large number of prospective deals that will fall in your lap. Not all of them will work. Your job, more than anything else, is to separate good deals from bad deals. If it won't work, walk away. HOWEVER, before you do that, ask yourself if anyone else could use that deal. If you can, assign the option to someone else, give the listing to a realtor, or direct them to someone that can help. ALWAYS be looking to help the prospect. If you can't make money off of it, can someone else? How can you be the person in the middle, and make a small profit? If you need coaching in how to make money off of a bad deal, contact me at master_negotiator75@yahoo.com
6) Listen, and then listen to what they are really saying:
I had a guy that called me on the phone once. He wanted to sell his house. I asked him what he thought the house was worth AND what he was asking for it. The numbers were the same. I, politely, told him that we were a business, and we couldn't stay in business if we didn't get properties for less than market value, and then sell them for close to market value. As I was hanging up, I heard the most wonder sound you can hear. He screamed, "WAIIIIIITTTTTT". As I wiped the drool off of my chin, I asked him, "Yes, how can I help you?" He was leaving town THE NEXT DAY. If we didn't buy it, he would lose it. (He was current on his mortgage, but had to leave). We got it under contract, transferred title, but didn't record it. We then sold the house to one of our students for a quick ten thousand. If I had hung up, I wouldn't have heard his underlying anxiety. Always ask an open ended question to gather information, and closed ended questions to clarify, and follow up. Sometimes, asking the same question, again, will elicit a totally different response.
For more information on how to ask questions contact me at: master_negotiator75@yahoo.com
7) Setting up the "Machine"
Once you get this started, it takes on a life of its own. If you just maintain it regularly, you can maintain the momentum without much daily fuss. It becomes an automaton, that just keeps growing and growing. The first years are the least profitable, BUT, as the years go on, the lease options start to execute, and you have properties that execute the options with huge profit margins. You also should (let me rephrase that, you MUST have positive cash flow on each property) so that will start to snowball. You also will get deals that will fall into your lap, just because you have a large funnel. If you do this correctly, you should have a massive positive cash flow with no risk to you, and an ongoing method to replenish the lead source. Once you have done this, you will have created a lease option business with no money out of pocket, no credit requirements, and no risk to you.
If you want more information, please contact me at master_negotiator75@yahoo.com
Friday, March 1, 2013
Look for problems, they are opportunities...rightly considered
Problems are opportunities...rightly considered.
A lot of people run from problems. They try to avoid them, and they will abandon any problem, without even considering the opportunities that it might present.My friend, Don Hodges, is a contractor. He would look for properties with structural problems, buy them for a song, fix the problem, and bring it up to code, and then sell the properties for a huge profit.
How was he able to do that?
1) He would analyze the problem. If he could solve it, it wasn't a problem.
2) He would analyze the costs and the return. If he spent 20,000 dollars buying a property, and another $4,000 in rehab, and $3,000 in closing costs, and he could turn around and sell that improved property for a total of $50,000, he just made a quick $23,000.
3) If the return was less than he required, he would walk away. It wouldn't make sense. Sometimes you will have an advantage of position, and you can take advantage of that.
One time, years ago, my cousin Pam and I found a double wide mobile home that had an:
1) IRS tax lien
2) Foreclosure
3) Double homicide
4) Divorce
5) Bankruptcy
When I walked in the back yard, I couldn't see the inground swimming pool from 20 feet away because the weeds were too high.
This property had problems. What did we do?
1) We consulted with our attorney and discovered that we could make an offer contingent upon the property being released from the tax lien. (Consult with your attorney before buying properties with IRS tax liens).
2) We could get the property released from the BK, again, we did this through our attorney.
3) We could rehab the property, and spend less than $5,000 to rehab it.
4) We could make a profit on the property IF we bought it from the bank at a low enough price.
We walked into the banker's office, and said, "We will offer you 9...." He said "YES!" before I finished saying $9500, so we left it at $9,000. This offer was SUBJECT TO all of the liens being released, and the title being pure as driven snow before we would purchase it.
We had to wait 60 more days for the tax lien to be released, but it was worth it.
We sold it and made a profit of over $20,000. Why? Because we had specialized knowledge, and knew the steps to take to take a problem that nobody else wanted, and turn it into an opportunity. (The bank didn't want it, we might have been able to negotiate an even lower offer, but we were happy with the price.)
"Yes, there's a problem, but it's not MY problem"
Sometimes you will do your due diligence, and discover that the problem is bigger, and more expensive, than you had wanted. If there is not enough return...don't do it. Let me repeat that, if there is a problem, but the solution does not give you a large enough profit...don't do it.
"Yes, there's a problem, but it's not MY problem." should be your attitude. The only way to make it worth your while is to have the other party make it worth your while.
Sometimes they will be unable to do that, and you walk away. Sometimes, there will be another party that will have to take a loss, and you will have to determine if there is enough profit in the deal to make it worth your while. If not, walk away.
This one time, a business partner and I were bidding on a property. An attorney had foreclosed on the house. We did a cost analysis, and showed him the numbers. The price that he was asking was too high, but, if he wanted to get rid of the house, we would take it for $25,000. (We put ten thousand into it, and sold it for $70,000 a few months later.)
The attorney didn't want to hire a crew, and put money out of his pocket to solve the problem. When we showed him the numbers, he agreed to our offer, and walked away.
The house was a mess. It had filthy walls, smelled like dog and cat urine, and was just plain ugly. We cleaned it up, put in a new HVAC unit, and sold it for a $21,000 profit. We had a solution, he didn't want to touch it. If he had refused our offer, we would have walked away.
Every deal is a bad deal, at the wrong price. Every deal is a good deal...at the right price. You must be able to discern what is a great deal, and what is a terrible deal.
You must know your costs.
If you are buying a property, or doing a task at work, you MUST know your costs; in time, effort, and dollars. If you don't do that, you could lose money on a deal. I had one client that bought a house, at just below retail, but then spent three months on it, working 10 to 12 hours a day on the project for three months, AND putting it in great condition, and then realized, belatedly, that they had spent more money on the property than they could get out. They had over-improved the property. The ONLY way to make money on a property that needs a lot of work...is if you know the solution, and the costs, and can still make a profit on the deal. (If you don't have the solution, or know the costs, walk away.)
What if you don't know the costs of a project at work? How many hours will it take to complete? Will it take you away from your other responsibilities? Will you be doing this task in your spare time, without compensation? If you don't know the costs, don't do it.
Take on tasks at work...that nobody else wants to do.
If you want to stand out from the crowd, do the things that nobody else wants to do, and do them well. When you do that, you have differentiated yourself from the competition, and brought value to the organization. However, if you do volunteer to do a project...do it well. If you volunteer, and you do a terrible job, nobody will remember that you went above and beyond to do a task that nobody else wanted to do; they will only remember that you did a bad job, and that you can't be trusted.
When you are taking on these tasks, document what you did, explain how it brought value to the company, have your supervisor acknowledge it, at the time, in writing. On your next performance review, bring out the documentation, and have that factor into your performance. If you are thinking of staying with a company, taking on additional tasks is the best way to get ahead. If you are thinking of leaving in the future, there is no better way to polish a resume than with a series of tasks and projects that brought value to the company. Don't worry, you will either get paid for your efforts from this employer, or your next one.
Don't take on thankless, impossible tasks that drain your energy, steal your money, and waste your time.
There will be some problems that are impossible to solve, will not be resume enhancing, and will be a complete waste of your time. Before you commit to a task, do your due diligence to see if you have a solution; AND if the rewards are greater than the risks and the work. If not, pass.
Be discerning in taking on new tasks and projects. If it's a problem, but it's not your problem, what benefits would you need to receive to make it your problem? If you will not get any benefits, don't waste your time.
In summary, Problems can be a huge opportunity, if you are discerning, analytical, and can find the solution. However, always have a solution before taking on someone else's problem, and know the risks and rewards before making the offer.
How to get a shy girl to fall in love with you.
Most guys have been rejected by a girl. For some of us, it happens every day. However, one of the best ways to get to know a girl is...to get to know her. How do you do that?
Ask her questions. Most women, especially beautiful women, have been hit on so many times that they have an early warning system for knowing when a guy is just trying to ask them questions to hit on them. The best way to overcome that is to be genuinely interested, and find her fascinating.
Let me give you an example; I was in an Office Depot to get some printing done, and I saw the most incredibly beautiful girl I had ever seen. She was there with her mother. I had two choices.
1) I could approach her.
2) I could ignore her.
Obviously I was going to approach her and ask for her number, but how could I do that without seeming like a pickup artist?
I was helpful, and I asked questions.
"Hi, if you are looking to save some time, what might be more helpful is if you did the self help printers over here. Can I show you how to use these?" How could anyone take offense when someone is genuinely helpful?
Step 2: I asked about her needs. It turns out that she was more interested in having the work done, than in saving time. Which allowed me to ask additional questions.
Step 3: Ask open ended questions, to gather a lot of information, and get her to open up about herself.
Step 4: Ask closed ended questions to clarify the answers in the open ended questions.
Step 5: Always give verbal cues to keep her talking about herself. If you genuinely show concern, and find her fascinating, she will find you attractive. (At least as attractive as you can possibly be.)
Ask her questions. Most women, especially beautiful women, have been hit on so many times that they have an early warning system for knowing when a guy is just trying to ask them questions to hit on them. The best way to overcome that is to be genuinely interested, and find her fascinating.
Let me give you an example; I was in an Office Depot to get some printing done, and I saw the most incredibly beautiful girl I had ever seen. She was there with her mother. I had two choices.
1) I could approach her.
2) I could ignore her.
Obviously I was going to approach her and ask for her number, but how could I do that without seeming like a pickup artist?
I was helpful, and I asked questions.
"Hi, if you are looking to save some time, what might be more helpful is if you did the self help printers over here. Can I show you how to use these?" How could anyone take offense when someone is genuinely helpful?
Step 2: I asked about her needs. It turns out that she was more interested in having the work done, than in saving time. Which allowed me to ask additional questions.
Step 3: Ask open ended questions, to gather a lot of information, and get her to open up about herself.
Step 4: Ask closed ended questions to clarify the answers in the open ended questions.
Step 5: Always give verbal cues to keep her talking about herself. If you genuinely show concern, and find her fascinating, she will find you attractive. (At least as attractive as you can possibly be.)
Tuesday, February 26, 2013
Use rewards to increase productivity
Years ago my Aunt Betty was helping me with one of my investment houses. She said, "Every time that you finish a task, give yourself a break, even if it's only for a minute." I thought it was good advice, and amplified that a little bit.
Using breaks to become more effective and productive
If you want to increase your productivity, set miniature tasks, and reward yourself after each task. When you do that, there is nothing that you will do that is too hard, or too long, because you have broken the task down into small, bite sized chunks and you are just going to do a little bit more until...break time!
Using breaks to become more effective and productive
If you want to increase your productivity, set miniature tasks, and reward yourself after each task. When you do that, there is nothing that you will do that is too hard, or too long, because you have broken the task down into small, bite sized chunks and you are just going to do a little bit more until...break time!
Give a speech
How to give a great speech, a step by step guide.
How to give a speech.
By Reed Sawyer
At some point, if you are a professional, you will be asked to give a speech. Don't freak out. Unless you are incredibly stupid it is possible for you to learn how to give an effective speech. Politicians do it every day, surely you can too.
Here is how to do it:
1) Find out the details: When will the speech be given? How long will it be? What is the topic? Who is my audience? Why does the audience care? (If the audience is given to people that are passionate about the topic, it is going to be a lot more fun that if people really don't want to listen to you.)
2) Write out your speech. Yes, a lot of people just "wing it" and don't worry about preparing at all. Those people are the ones that are so full of themselves that they don't care if they are prepared, and they bore everyone that hears them. They are the people that usually give speeches, and are hated. A good speech is prepared, written out, and practiced several times before it is actually performed. It is a communication, and, like most performances, is better when thought is actually put into it.
a) Who is going to be there? (This will determine the topic and the tone of your speech? A speech given to third graders will be a lot different than a speech given to educated professionals).
b) What is the topic? This is the reason why they are there. They want to hear you speak about ______. What is it? Why should they care? If they don't hear your information, what will they lose? If they do hear your information, how do they gain? How is it relevant to THEIR life? If you can't articulate that, don't go.
3) Lose your fear. The entire audience; the ENTIRE audience is terrified that you are going to be boring. They WANT you to be funny. They will laugh at anything that is remotely funny coming out of your mouth. They are rooting for you, because they have heard too many bad speeches and they desperately want you to be good. They aren't expecting it, but they want it.
4) Don't give a speech. NEVER, EVER, EVER give a speech. Tell stories. Nobody wants to hear a speech, but everyone wants to hear a story that they will remember, especially if it is funny. If you can ask questions (even rhetorical questions) of the audience, it keeps their interest high. Don't make statements, ask questions.
5) Keep it simple. A stupid man's report of what a clever man says is never accurate because he unconsciously translates what he hears into something he can understand. So, make it simple. If you have a complicated concept, break it down into simple processes that they can understand on a cellular level. If you have numbers, toss them out. Tell a story about how those numbers affect a person. If you want to do a quantitative analysis, throw that out and replace that with the story of two people, and how it affects their lives. Keep it simple, keep it in a story, and personalize it.
6) When you introduce yourself, relate to people. If you are talking to a bunch of parents; YOU are a parent, or you know a parent. If you are talking to people from a small farming area; YOU are from a small farming area, or you know someone that is from a small farming area. People like people that are like themselves, be like them.
7) Don't be stuffy. Don't speak over the heads of your audience. acknowledge three or four people in the audience that you met with earlier, and thank them for allowing you to share your stories. (Never say the word, "speech".)
8) The mike is your friend. Choose the hand that will be holding the mike. With your other hand, extend your thumb, as if you are giving a "thumbs up". The distance from your nose to the microphone should be distance from the tip of your thumb to the back of your hand. With your mike hand, practice keeping the same distance each and every time. Plant your elbow against your chest and practice keeping the microphone at the same distance from your mouth each and every time that you move. You can use your non-mike hand to wave and gesture, but always keep your mike in the same relative position. This will keep the volume steady.
9) Don't keep the volume steady. When you talk to a friend, you raise and lower the level and pitch of your voice. Do not be robotic, practice varying the intensity and volume of your voice.
10) A speech is a performance, so perform. Be interesting. Be demonstrative. Mention people in the audience, ask them to stand up, acknowledge them and include them into your stories, if possible.
11) "Tell people what you are going to say, tell them, then tell them what you said" is the ancient advice for speeches. Here is a modification. Tell people how what you are going to say is RELEVANT to them. If it's not relevant, they don't care. When you include them in the process, and it's about THEM, they will listen all day long.
How to give a speech.
By Reed Sawyer
At some point, if you are a professional, you will be asked to give a speech. Don't freak out. Unless you are incredibly stupid it is possible for you to learn how to give an effective speech. Politicians do it every day, surely you can too.
Here is how to do it:
1) Find out the details: When will the speech be given? How long will it be? What is the topic? Who is my audience? Why does the audience care? (If the audience is given to people that are passionate about the topic, it is going to be a lot more fun that if people really don't want to listen to you.)
2) Write out your speech. Yes, a lot of people just "wing it" and don't worry about preparing at all. Those people are the ones that are so full of themselves that they don't care if they are prepared, and they bore everyone that hears them. They are the people that usually give speeches, and are hated. A good speech is prepared, written out, and practiced several times before it is actually performed. It is a communication, and, like most performances, is better when thought is actually put into it.
a) Who is going to be there? (This will determine the topic and the tone of your speech? A speech given to third graders will be a lot different than a speech given to educated professionals).
b) What is the topic? This is the reason why they are there. They want to hear you speak about ______. What is it? Why should they care? If they don't hear your information, what will they lose? If they do hear your information, how do they gain? How is it relevant to THEIR life? If you can't articulate that, don't go.
3) Lose your fear. The entire audience; the ENTIRE audience is terrified that you are going to be boring. They WANT you to be funny. They will laugh at anything that is remotely funny coming out of your mouth. They are rooting for you, because they have heard too many bad speeches and they desperately want you to be good. They aren't expecting it, but they want it.
4) Don't give a speech. NEVER, EVER, EVER give a speech. Tell stories. Nobody wants to hear a speech, but everyone wants to hear a story that they will remember, especially if it is funny. If you can ask questions (even rhetorical questions) of the audience, it keeps their interest high. Don't make statements, ask questions.
5) Keep it simple. A stupid man's report of what a clever man says is never accurate because he unconsciously translates what he hears into something he can understand. So, make it simple. If you have a complicated concept, break it down into simple processes that they can understand on a cellular level. If you have numbers, toss them out. Tell a story about how those numbers affect a person. If you want to do a quantitative analysis, throw that out and replace that with the story of two people, and how it affects their lives. Keep it simple, keep it in a story, and personalize it.
6) When you introduce yourself, relate to people. If you are talking to a bunch of parents; YOU are a parent, or you know a parent. If you are talking to people from a small farming area; YOU are from a small farming area, or you know someone that is from a small farming area. People like people that are like themselves, be like them.
7) Don't be stuffy. Don't speak over the heads of your audience. acknowledge three or four people in the audience that you met with earlier, and thank them for allowing you to share your stories. (Never say the word, "speech".)
8) The mike is your friend. Choose the hand that will be holding the mike. With your other hand, extend your thumb, as if you are giving a "thumbs up". The distance from your nose to the microphone should be distance from the tip of your thumb to the back of your hand. With your mike hand, practice keeping the same distance each and every time. Plant your elbow against your chest and practice keeping the microphone at the same distance from your mouth each and every time that you move. You can use your non-mike hand to wave and gesture, but always keep your mike in the same relative position. This will keep the volume steady.
9) Don't keep the volume steady. When you talk to a friend, you raise and lower the level and pitch of your voice. Do not be robotic, practice varying the intensity and volume of your voice.
10) A speech is a performance, so perform. Be interesting. Be demonstrative. Mention people in the audience, ask them to stand up, acknowledge them and include them into your stories, if possible.
11) "Tell people what you are going to say, tell them, then tell them what you said" is the ancient advice for speeches. Here is a modification. Tell people how what you are going to say is RELEVANT to them. If it's not relevant, they don't care. When you include them in the process, and it's about THEM, they will listen all day long.
Thursday, February 14, 2013
From Thug to Tycoon
From Thug to Tycoon
by Reed Sawyer
There is a HUGE injustice in this country. Young black males have a 46% unemployment rate...and it's not getting better anytime soon. Before we start protesting, let's examine how to reduce that unemployment statistic by at least one person...YOU.
If you are young, black, and male, your chances of being hired are very small. How can we change that? First, let's realize that a boss DOES NOT have to hire you. He will hire you IF and ONLY IF you make money for his company in excess of your costs. If you have potential liabilities that would cost him money, he would rather poke himself in the eye first.
So, what can you do?
Let's examine your assets, and your liabilities, and let's readjust them so that your liabilities are now assets. Can we do that?
Your anger: Anger is nothing more than badly focused energy. What makes you angry? Is it being poor? Ok, then let's make some money. Your anger, or energy, needs to be focused on things that put money into your pocket.
The easiest job to get is the one that nobody wants...sales. If you can sell, you can make as much money as you deserve. It is not about your hours, but about your production.
How can you increase your sales production?
1) Don't scare your customers. If you are going to talk to people on the phone, you have to be articulate, eloquent, and prepared. That means that if you have a heavy street accent, it might be time to take elocution and diction lessons so that you don't sound like a gangbanger. What are the best resources? Look to SNIROL.com for more information on our guaranteed speech performance tools to make you sound great.
2) Don't scare your customers. If you are going to meet people, you have to be dressed professionally. Baggy pants are out. Khakis are in.
3) Don't scare your customers. If you are going to meet people, you must be well groomed. Cover up your tattoos. Shave off your facial hair. (10% of all customers will be afraid of people with facial hair. 10% of people will be afraid of people with tattoos. 10% of people will be afraid of people that are bald. 10% of people will be afraid of people with gold teeth. 10% of people will be afraid of people with a thick accent. 10% of people will be afraid of people that make fast movements and use their hands in an aggressive manner. If 60% of the potential customers are afraid of you, you are working too hard. You have to ask yourself, what do you care about more? Looking like a gangster? Or making money.
Lose the flash, Grab the cash.
How else can you make money? Time management is an essential part of any entrepreneur/success process. Your goal is to be focused, without distractions, and plan your time so that when you are selling, you aren't losing sales. (All it takes to lose a sale is to have someone ask a question that you don't know the answer...and you don't know how to respond. By the way, the best way to handle that situation is to answer, "That's a great question! I don't hear that every day. In fact, it's the first time that anyone has asked that question. I compliment you on asking such an intelligent question. Let me research that and get back to you...in the meantime, are there any other questions that would stop you from going forward on this today? You know, why don't we move forward, for all of the obvious reasons. Please sign here."
by Reed Sawyer
There is a HUGE injustice in this country. Young black males have a 46% unemployment rate...and it's not getting better anytime soon. Before we start protesting, let's examine how to reduce that unemployment statistic by at least one person...YOU.
If you are young, black, and male, your chances of being hired are very small. How can we change that? First, let's realize that a boss DOES NOT have to hire you. He will hire you IF and ONLY IF you make money for his company in excess of your costs. If you have potential liabilities that would cost him money, he would rather poke himself in the eye first.
So, what can you do?
Let's examine your assets, and your liabilities, and let's readjust them so that your liabilities are now assets. Can we do that?
Your anger: Anger is nothing more than badly focused energy. What makes you angry? Is it being poor? Ok, then let's make some money. Your anger, or energy, needs to be focused on things that put money into your pocket.
The easiest job to get is the one that nobody wants...sales. If you can sell, you can make as much money as you deserve. It is not about your hours, but about your production.
How can you increase your sales production?
1) Don't scare your customers. If you are going to talk to people on the phone, you have to be articulate, eloquent, and prepared. That means that if you have a heavy street accent, it might be time to take elocution and diction lessons so that you don't sound like a gangbanger. What are the best resources? Look to SNIROL.com for more information on our guaranteed speech performance tools to make you sound great.
2) Don't scare your customers. If you are going to meet people, you have to be dressed professionally. Baggy pants are out. Khakis are in.
3) Don't scare your customers. If you are going to meet people, you must be well groomed. Cover up your tattoos. Shave off your facial hair. (10% of all customers will be afraid of people with facial hair. 10% of people will be afraid of people with tattoos. 10% of people will be afraid of people that are bald. 10% of people will be afraid of people with gold teeth. 10% of people will be afraid of people with a thick accent. 10% of people will be afraid of people that make fast movements and use their hands in an aggressive manner. If 60% of the potential customers are afraid of you, you are working too hard. You have to ask yourself, what do you care about more? Looking like a gangster? Or making money.
Lose the flash, Grab the cash.
How else can you make money? Time management is an essential part of any entrepreneur/success process. Your goal is to be focused, without distractions, and plan your time so that when you are selling, you aren't losing sales. (All it takes to lose a sale is to have someone ask a question that you don't know the answer...and you don't know how to respond. By the way, the best way to handle that situation is to answer, "That's a great question! I don't hear that every day. In fact, it's the first time that anyone has asked that question. I compliment you on asking such an intelligent question. Let me research that and get back to you...in the meantime, are there any other questions that would stop you from going forward on this today? You know, why don't we move forward, for all of the obvious reasons. Please sign here."
Incremental Revenue...a.k.a. "Vacation money"
Incremental Revenue...aka "vacation money"
by Reed Sawyer
+1 Demo: Async load
I hated it. I hated looking out my window and seeing people staring in at me. I kept the curtains shut, and I complained to my Aunt Betty about it. (She was one of the partners in the RV park business). "Why do we have to have those stupid campers outside of my windows? I hate it."
My Aunt Betty was wise, and she said, "Reed, you're looking at it all wrong. All of the fixed costs of the park have already been paid for, we didn't have to spend any more money developing those lots. The ONLY cost that we have is for water and electricity, and those are minimal. This is VACATION MONEY."
Once she articulated it like that, I loved it. I wanted us to get more campers around our houses.
Let's examine what incremental revenue is: Incremental revenue is revenue that comes in addition to your regular revenue, but without additional variable costs (or very minimal costs). The fixed costs have already been paid, your variable costs are low, and the incremental revenue is almost pure profit. It is "VACATION MONEY".
Is there any way that your business can develop additional incremental revenue? What processes, space, advantages does your business have that it isn't using all the time that people need? Can you create some incremental revenue streams from unused capacity?
If you are a bar/restaurant owner: Do you have a slow night of the week that is underutilized? Can you contact insurance companies, car dealerships, any sales organization and offer to let them use a meeting room, FOR FREE, on that night? (What will they do? They will probably all eat a meal, have a few drinks, and you might even have them start thinking of the restaurant as "their place" and start coming back more frequently.) What is your cost? Nothing. You already had that room available. What is your possible incremental revenue? Possibly an average of $10 per head, minimum. If you have 20 extra customers per week, on your slowest night, will that give you more "heat" and bring in more customers?
Can you sell advertising space on your menu? Can you talk to every business in a one mile radius and see if you can deliver sandwiches daily? Weekly? Can you give the business owners a 20% discount on their morning coffee and pastry? Can you arrange with the business owners to have celebratory dinners at your restaurant, on slow nights, at a discount?
If you are a commercial dry cleaner: Do you have large washers and dryers? Can you do napkins and tablecloths for restaurants? Can you do shirt laundry for a car dealership/body shop? If you have excess time in the day where your machines are not running, can you find a company that needs to have their uniforms washed daily? What should you charge? Whatever you can get, but your fixed costs and variable costs are already paid, this is pure profit.
Can you offer an expedited service, for a premium? If someone wants a garment cleaned in an hour, can you do it? (If your boilers are still on and you have your crew available?) Can you offer premium service, for a little bit extra?
Can you wash welcome mats for businesses? (Most welcome mats are too big for a normal washing machine, you have a unique advantage over the small machines.) What is your cost of doing them? (Remember that you don't have to press or dry the mats.) Can you use that as an intro to doing uniform laundry?
If you have public restrooms with lots of traffic: Can you do advertisements in your bathroom over the urinals? (What is your cost for a small advertising display case? If you charged $20 a month, would you recoup your costs in the first month?)
If you have lots of foot traffic, and excess space: Can you offer storage lockers? How quickly would you recoup your money? When the people come back to your store, can you upsell them into another purchase?
Can you have a soda cooler next to the cash registers? People will pay premium for convenience items made on impulse. Can you have high impulse items there as well?
If you have a service business: Can you offer seasonal checkups (air conditioners, water heaters, appliances, etc...) for a nominal fee? (If they need repairs, you are almost guaranteed to get the work.)
If you have enough "incremental revenue" sources, would that help your business? Would that "vacation money" make your business more profitable, and make it easier to sell when you are ready to sell?
Can you brainstorm and find a dozen different incremental revenue sources that are untapped, and make those available? When you let your customers know that you have "off the menu" choices and services available, and let them know that you are there to help them with ANY of their needs, you might just pick up additional ideas, and additional revenue.
Keep your core business healthy, but utilize excess capacity, space, resources for incremental revenue, and watch your profits soar.
by Reed Sawyer
I hated it. I hated looking out my window and seeing people staring in at me. I kept the curtains shut, and I complained to my Aunt Betty about it. (She was one of the partners in the RV park business). "Why do we have to have those stupid campers outside of my windows? I hate it."
My Aunt Betty was wise, and she said, "Reed, you're looking at it all wrong. All of the fixed costs of the park have already been paid for, we didn't have to spend any more money developing those lots. The ONLY cost that we have is for water and electricity, and those are minimal. This is VACATION MONEY."
Once she articulated it like that, I loved it. I wanted us to get more campers around our houses.
Let's examine what incremental revenue is: Incremental revenue is revenue that comes in addition to your regular revenue, but without additional variable costs (or very minimal costs). The fixed costs have already been paid, your variable costs are low, and the incremental revenue is almost pure profit. It is "VACATION MONEY".
Is there any way that your business can develop additional incremental revenue? What processes, space, advantages does your business have that it isn't using all the time that people need? Can you create some incremental revenue streams from unused capacity?
If you are a bar/restaurant owner: Do you have a slow night of the week that is underutilized? Can you contact insurance companies, car dealerships, any sales organization and offer to let them use a meeting room, FOR FREE, on that night? (What will they do? They will probably all eat a meal, have a few drinks, and you might even have them start thinking of the restaurant as "their place" and start coming back more frequently.) What is your cost? Nothing. You already had that room available. What is your possible incremental revenue? Possibly an average of $10 per head, minimum. If you have 20 extra customers per week, on your slowest night, will that give you more "heat" and bring in more customers?
Can you sell advertising space on your menu? Can you talk to every business in a one mile radius and see if you can deliver sandwiches daily? Weekly? Can you give the business owners a 20% discount on their morning coffee and pastry? Can you arrange with the business owners to have celebratory dinners at your restaurant, on slow nights, at a discount?
If you are a commercial dry cleaner: Do you have large washers and dryers? Can you do napkins and tablecloths for restaurants? Can you do shirt laundry for a car dealership/body shop? If you have excess time in the day where your machines are not running, can you find a company that needs to have their uniforms washed daily? What should you charge? Whatever you can get, but your fixed costs and variable costs are already paid, this is pure profit.
Can you offer an expedited service, for a premium? If someone wants a garment cleaned in an hour, can you do it? (If your boilers are still on and you have your crew available?) Can you offer premium service, for a little bit extra?
Can you wash welcome mats for businesses? (Most welcome mats are too big for a normal washing machine, you have a unique advantage over the small machines.) What is your cost of doing them? (Remember that you don't have to press or dry the mats.) Can you use that as an intro to doing uniform laundry?
If you have public restrooms with lots of traffic: Can you do advertisements in your bathroom over the urinals? (What is your cost for a small advertising display case? If you charged $20 a month, would you recoup your costs in the first month?)
If you have lots of foot traffic, and excess space: Can you offer storage lockers? How quickly would you recoup your money? When the people come back to your store, can you upsell them into another purchase?
Can you have a soda cooler next to the cash registers? People will pay premium for convenience items made on impulse. Can you have high impulse items there as well?
If you have a service business: Can you offer seasonal checkups (air conditioners, water heaters, appliances, etc...) for a nominal fee? (If they need repairs, you are almost guaranteed to get the work.)
If you have enough "incremental revenue" sources, would that help your business? Would that "vacation money" make your business more profitable, and make it easier to sell when you are ready to sell?
Can you brainstorm and find a dozen different incremental revenue sources that are untapped, and make those available? When you let your customers know that you have "off the menu" choices and services available, and let them know that you are there to help them with ANY of their needs, you might just pick up additional ideas, and additional revenue.
Keep your core business healthy, but utilize excess capacity, space, resources for incremental revenue, and watch your profits soar.
Friday, February 8, 2013
How to increase your business revenue, profits, and value.
by Reed Sawyer
+1 Demo: Async load
One of the best ways to increase your business volume is to have an event. When I was a mortgage broker out in Colorado, we would do an event every month. We would offer free hot dogs or pizza, a bouncy tent for the kids, and we would offer great rates for a refinance. The amount of business that we would get from those events would be two thirds of our revenue for the month.
A friend of mine has a barbecue place in Apopka. Every Thursday night he has a biker night with live music, hot waitresses, and the best barbecue in the city. It draws hundreds of people, and it brings in new customers, that he then converts into repeat customers.
I was the director of Marketing for a Sewing and Vacuum shop. We had a seminar for a Stabilizer company (The fabric that embroidery is sewn on so that it doesn't bunch up after washing). We pushed it hard, and had three classes, bringing in people that had never heard of our business before, and doing a huge volume.
What exactly is an event?
An event is something that draws new people to your store/business, and gets them to spend money that they would not ordinarily spend.
What are examples of an "event".
1) Do a promotion with a radio show to offer a special sale.
2) Do a promotion with outside food and beverage (if you are not a restaurant). An example would be a car dealership offering free hot dogs and sodas to people on a Saturday.
3) Do a seminar. It doesn't even have to be something that you are giving, you could find a business that needs to promote their business, and you have the space, chairs, or tables to provide a seminar space. In that event, you can promote the event, without a lot of cost, and bring people in to your business that might not ever visit your store.
4) Have a musician play at your location. (This works best for bars and restaurants, but I have also seen it for retail stores.)
5) Have complimentary businesses, do a co-op event with you. Each of the businesses markets to your own customers/clients, and bring people to the event.
6) Have a promotional model come in (Pretty girls are the best), Do give-aways, coupons, and discounts and make it fun.
How do you attract new customers to your business?
The best way is to reach them through your current customers. Do a fishbowl, gather email addresses and tell people the BIG NEWS about your upcoming promotion. What's in it for them? Why would they want to come?
The next best way to do this is to advertise. I would suggest a co-op marketing campaign where you find neighboring businesses (non-competitive) that would like to have more business, and do a co-op advertising campaign to keep the cost of advertising per business low.
Another way to bring in customers is through a newsletter/blog/facebook/social media outlet. If you are skilled in creating exciting and interesting posts, invite people to come to your event, and give them a coupon or gift for attending.
Do's and Don'ts for an event:
1) Do know your costs. For advertising, speaker fees, premiums, everything that you will be spending money on, you must know the costs ahead of time, or you could grow your business into bankruptcy. If you have a 10% profit margin, you must get at least 10 dollars in new revenue for every dollar that you spend.
2) Do have a REASON for the promotion. Why would anyone want to come? If it is not compelling enough, make it compelling, or don't do it.
3) Do have a way to track attendance, sales, and profits, so that you can decide if you want to do it again. If you are not tracking your advertising dollars, you are wasting your money. Every person that comes into the store should be asked, nicely, "By the way, how did you hear of us?" That response should be noted, and put into a spreadsheet. List the source of the lead, the amount purchased, and the quality of the customer. (How often do they come in? How much do they typically buy? Are they a good customer?)Olympus Tg320 14Mp Digital Camera (Google Affiliate Ad)
by Reed Sawyer
One of the best ways to increase your business volume is to have an event. When I was a mortgage broker out in Colorado, we would do an event every month. We would offer free hot dogs or pizza, a bouncy tent for the kids, and we would offer great rates for a refinance. The amount of business that we would get from those events would be two thirds of our revenue for the month.
A friend of mine has a barbecue place in Apopka. Every Thursday night he has a biker night with live music, hot waitresses, and the best barbecue in the city. It draws hundreds of people, and it brings in new customers, that he then converts into repeat customers.
I was the director of Marketing for a Sewing and Vacuum shop. We had a seminar for a Stabilizer company (The fabric that embroidery is sewn on so that it doesn't bunch up after washing). We pushed it hard, and had three classes, bringing in people that had never heard of our business before, and doing a huge volume.
What exactly is an event?
An event is something that draws new people to your store/business, and gets them to spend money that they would not ordinarily spend.
What are examples of an "event".
1) Do a promotion with a radio show to offer a special sale.
2) Do a promotion with outside food and beverage (if you are not a restaurant). An example would be a car dealership offering free hot dogs and sodas to people on a Saturday.
3) Do a seminar. It doesn't even have to be something that you are giving, you could find a business that needs to promote their business, and you have the space, chairs, or tables to provide a seminar space. In that event, you can promote the event, without a lot of cost, and bring people in to your business that might not ever visit your store.
4) Have a musician play at your location. (This works best for bars and restaurants, but I have also seen it for retail stores.)
5) Have complimentary businesses, do a co-op event with you. Each of the businesses markets to your own customers/clients, and bring people to the event.
6) Have a promotional model come in (Pretty girls are the best), Do give-aways, coupons, and discounts and make it fun.
How do you attract new customers to your business?
The best way is to reach them through your current customers. Do a fishbowl, gather email addresses and tell people the BIG NEWS about your upcoming promotion. What's in it for them? Why would they want to come?
The next best way to do this is to advertise. I would suggest a co-op marketing campaign where you find neighboring businesses (non-competitive) that would like to have more business, and do a co-op advertising campaign to keep the cost of advertising per business low.
Another way to bring in customers is through a newsletter/blog/facebook/social media outlet. If you are skilled in creating exciting and interesting posts, invite people to come to your event, and give them a coupon or gift for attending.
Do's and Don'ts for an event:
1) Do know your costs. For advertising, speaker fees, premiums, everything that you will be spending money on, you must know the costs ahead of time, or you could grow your business into bankruptcy. If you have a 10% profit margin, you must get at least 10 dollars in new revenue for every dollar that you spend.
2) Do have a REASON for the promotion. Why would anyone want to come? If it is not compelling enough, make it compelling, or don't do it.
3) Do have a way to track attendance, sales, and profits, so that you can decide if you want to do it again. If you are not tracking your advertising dollars, you are wasting your money. Every person that comes into the store should be asked, nicely, "By the way, how did you hear of us?" That response should be noted, and put into a spreadsheet. List the source of the lead, the amount purchased, and the quality of the customer. (How often do they come in? How much do they typically buy? Are they a good customer?)Olympus Tg320 14Mp Digital Camera (Google Affiliate Ad)
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