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What do I do now?

May 2020

We have been though very difficult trading the last few months, and unfortunately there is still pain ahead for some agents. So how do I recover from this?

First, we need to understand that the road to recovery will be slow, and will vary from agency to agency, so, I want to give you some ideas that will assist you in laying out and working through your own recovery plan during the next few months and beyond.

  1. Form a support recovery team.
  • Every one of us have our own set of skills and knowledge base, but we need to acknowledge that you don’t know everything, and you need help to recover.
  • Find people who can help you plan and implement recovery action points for you and your team, to help you to see any potential blind spots.
  • Diversity is important, you don’t just want an accountant who’s focus is solely on cutting costs, although this is important. Find a mentor or business coach and set up a team who can help you and your business recover.
  • Then get your team onside, focusing them on the important actions needed to start recovery. 
  1. Strengthen the income.
  • Often overlooked, but so important. A small increase in fees charged for selling and property management is pure profit so don’t shy away from reviewing what you charge.
  • Remember cost of sale is a cost to you, so make sure you are recouping and covering all client advertising and sales costs.
  1. Trim the fat.
  • What is not essential is up for disposal, magazine and paper subscriptions, unnecessary software subscriptions and office supplies are all up for review.
  • Remember the more electronic communication used the less paper used, this can be a big money saver.
  • Go through every item in your P&L and ask the question ‘Is this essential?’.
  1. Creating a safety net.
  • Don’t take on debt for the sake of it, first explore the other options you may have available. Consider selling an unnecessary asset, or,
  • Sell part of your business by bringing in a partner that can complement your business skills. 
  • Merge with a larger stronger agency. Keep your mind open to options.
  1. Focus on the core.
  • What produces the biggest portion of income? Focus on the majors not the minors when it comes to your business, keeping in mind that cashflow is king.
  1. Remember Kaizen.
  • Japan became the powerhouse of industry after the second world war, seeking to improve the quality of their products by introducing a process called Kaizen. It entails bringing in small incremental improvements every day to your business, which long term, can lead to big improvements. Remember the old joke, how did the pigmy eat the elephant? One bite at a time!
  • Every small change can, over time, make a big difference to your business so make time to work on your business not just in your business.

 

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