The storm clouds have been massing on the economical horizon for some time, and the sun is having a hard time breaking through. More tough times ahead. As the storm rolls in more fierce, our correct natural instinct is to kick into survival mode.
I plan on surviving this storm, will you join me?
Depending on who you talk to, we are either already in a recession or will be soon. The writing is on the wall.
My brokerage firm announced publicly yesterday that it is right-sizing. Coldwell Banker Schneidmiller Realty is consolidating three offices into one and releasing all part-time agents. I believe it is a savvy move for the #1 brokerage in town. For the brokerage, and for the agents determined to survive while offering exceptional service to their clients. According to Bill Bartman, said to be the 27th richest man in the country, it's a perfect example of what we ALL need to do to ride out the storm - get lean, get focused, and expand marketing like never before.
Mr. Bateman says there are five things we need to understand about recessions:
1. They regularly happen, usually about every 8 or 9 years.
2. More than 500,000 businesses fail during a recession.
3. They are ultimately healthy - they weed out the crowd and level the playing field.
4. They reward the nimble and the flexible.
5. All of them come to an end within 1 to 2 years.
Bartman points to six ways that smart survivors not only ride out the storm, but also find themselves in control of their market areas once the storm has blown over.
OK, I'm ready to listen, because I plan to survive, and eventually thrive!
1. Get Lean!
Paring down operating expenses is a must. Some examples: employee cuts may be needed; if you have two product lines and one is failing, sell or discontinue that division and concentrate on core markets; ratchet down inventory; cut or eliminate travel expenses, meals and entertainment; renegotiate contracts for materials, equipment and services.
2. Expand Financing.
Borrowing power tightens with the economy. Line up dollars and terms NOW for the long haul. Knowing it's there when you need it will free you up to make smart decisions. For me, the best advice I ever got for my real estate business was to LEAD WITH REVENUE. If I don't have the cash, I don't buy it. ALWAYS a good plan.
3. INCREASE Marketing.
Why? While your competitors are cutting back or ceasing their presence in the marketplace, you'll be positioning yourself to capture their lost market share. How? Revise your promotions to make buying from you easy for you customers; put systems in place to get in touch with your past clients and stay in touch with them every 21 to 30 days; create referral reward programs (note to Realtors, don't violate RESPA!) implement direct mail and drip marketing campaigns; focus on high-end and economic buyers for highest response rates; match your message to your market segment; FINE TUNE AND AGGRESSIVELY PROMOTE YOUR UNIQUE SELLING PROPOSITION!
4. Maintain Prices.
Business analysts and recession survivors all tell us it's a mistake to slash prices to increase cash flow. If anything, some products may need to increase in price. Deep discounts and services weakens brand value, dilutes your profit margin and when the economy shifts your customers will still expect similar discounts. Instead, offer extras or freebies that incent loyal clients without damaging your brand or the bottom line.
5. Adopt Cutting Edge Solutions.
Technology can be the key when competition grows and the economy wanes. Customer relationship management software, email marketing systems, drip campaign programs and admin management software allow you to know your business is running smoothly and allows you to keep your eye on the ball.
As I said before, I am in this for the long haul. I love the real estate business, helping people be successful when their hopes and dreams involve buying or selling real estate. I'm good at it. It makes me happy. I make my clients happy. Now, more than ever, people need EXCELLENT real estate advice and representation. I plan to ride out this storm and come out stronger on the other side.
May God continue to bless America, where we are free to choose how we will react to circumstances beyond our control.
Photography credit goes to my amazing sister, Kerri Thoreson; and to Don Sausser for the rainbow photo.
Janna Rankin Scharf, AB, GRI, CSP, CNS, CLHMS, provides a superior level of real estate services to home buyers and sellers in Coeur d'Alene and Kootenai County, Idaho. Visit www.JannaScharf.com to search for homes in the Coeur d'Alene MLS for anywhere in spectacular North Idaho.
Janna Rankin Scharf, 208.651.9700 NorthIdahoJanna@gmail.com
The local Women's Gift Alliance (WGA) has been one of the best kept secretes of North Idaho for the past 4 years. This group of selfless women have been giving back to their communities in a really BIG way virtually unnoticed by anyone other than those that have benefited from their generosity. And that is just the way this fantastic group of women like it! They feel it is more important to make a difference in their communities quality of life than to get noticed for it.
DATE: Tuesday, Dec 9th, 2008
Pam Jank, Realtor, GRI, CRS, ABR, RRS, PPS
