If you’ve read Grant Cardone’s bang-up business book The 10X Rule, then you know that the premise of the book is that people VASTLY underestimate the amount of effort that needs to be expended in order to achieve life-changing types of goals. That general principle is alive and well in the world of cold calling and I have to admit that I’ve been guilty of it.
My real estate goal is to take 52 listings per year and close them all. Any buyer business that comes out of that is just “gravy money” on top. Since employing the Fearless Agent Listing and Pricing Presentations, I have never NOT sold a listing that I’ve taken on – as long as the seller didn’t decide to buck the process after we got started. So targeting a close-to-100% list-to-sell ratio is not unreasonable.
But how many contacts per day do I need to make
in order to achieve my BIG Goal?
Well for the past few years now I’ve been running those types of calculations through my head. You know…in the morning while making coffee and stuff. Over time I’ve realized that a lot of variables go into all that. Things such as how many days per month you’re calling, how many contacts you need to make in order to get a lead, and how many leads (when properly followed up with) will translate into a signed listing contract.
So today I created a quick-n-dirty tool that gives some perspective on all that. It’s a simple Excel file that you can download here. I even created a video you can find further down below that explains how to use it.
All you need to do is plug in numbers in the GREEN boxes and everything else will calculate out for you. One green box in particular needs to be explained and that’s that one called Est. Lead-to-Listing Rate. Make sure that you account for ALL the stuff that’s likely to happen which results in the various people that make up your pool of leads choosing to NOT list with you. These things include:
- Leads You Lose in Your CRM
- Leads that start screening your phone calls and give you the fade out
- Leads that choose to list with another agent instead of you
- Leads the straight-up change their mind
- Leads that were not good leads in the first place because they lacked motivation but you COUNTED them as leads
- …and most important….
- Leads that let you stop by their house for a listing appointment but do NOT list with you
Proper Prior Planning Prevents…
Have you ever heard of “The Power of Negative Thinking“? It’s not talked about much in real estate circles because everyone is so focused on being positive and “attracting good and not bad” into their business lives and stuff. Most businesses don’t run that way though and the most BASIC of business courses you could ever take (high school level business courses) will tell you that startups need to be built around “worst case scenarios”.
For example. Two super-smarties want to start up WidgetCo so they can sell their new-fangled widgets to the people of the world. And make money. Yeah – that too.
So they start laying out their business plan. They THINK they can sell each of their widgets for $45. IF they can sell their widgets at $45 then things are going to be GREAT. But that’s a BIG “If”. They KNOW, that the market might not care about their estimates. The market might not BUY the widgets at $45. Maybe they can only get them sold at a price point of $35. If that happens, can the company make a profit? What if they can only sell at $25? Can the company survive if they have to sell at that price point?
Planning for the worst. Worst-case-scenario. All smart businesses do it. They don’t “assume that things are going to turn out even BETTER than they’d ever hoped”. Because it just doesn’t seem to go that way in the real world.
That being the case, I suggest you be VERY careful with the Est. Lead-to-Listing Rate. I’m keeping mine at 10%. If it ends up higher, if I end up extracting a greater percentage of listings out of my lead pool this year, well that will be good for me. But it’s highly unlikely that the result will be LESS than 10%. So I’m going with that.
The video below shows how to use the tool itself. Take a look and then be sure to read my final thoughts found below the video.
So again, if you want to download the Excel spreadsheet for this…you can find it here.
Remember the 10x Rule I mentioned at first? Remember how the central idea in that book is that we underestimate the effort needed to achieve our goals? Well this little tool made so very clear how true that is for me.
With a target of taking 52 listings per year, and assuming that I’ll only sign 10% of the leads I connect with to listing contracts, and also assuming that I’ll only consistently call 22 days per month over the course of the year, and also assuming that my historical average of getting 1 lead for every 100 contacts (on average) – well that means…
I need to be contacting 197 people per DAY!
That’s a LOT more than I’ve been contacting. It’s DOUBLE the daily quota I originally set for myself. It’s already the 7th of January. For the first 7 days of the year I’ve been only even been TRYING to contact HALF the number of people per day that I need to in order to be confident that I can achieve my goal for this year!
This little calculator shocked me. I’m guessing that if you run it yourself it might shock you. It re-emphasizes in my mind that Lucky Luciano was right. We cold calling real estate agents need to be thinking in MULTIPLES of 100 contacts per day. We need to get ourselves over our own mental roadblocks about running six phone lines through two dialers. We need to be mentally accepting the additional cost that additional dialers, phone lines, and headsets are going to incur.
We need to just accept it all and DO WHATEVER IT TAKES to get that 10X level of action up and running NOW.
So for me…the new minimum number of contacts per day is 200. Boom.