Time can either be your friend or your enemy. A friend when invested correctly and an enemy where there is little to no return on time spent. This is also dependent on the size of the transaction you are working on.
Time spent pursuing activities that are have smaller returns is time that could be invested in larger opportunities. To grow as a business it is important to invest time in things that make a difference. The goal should always be that every activity should take you closer to your business goals.
Just because a service or client counts as a small opportunity doesn’t mean it is not worth the time. Often times smaller opportunities can lead to lasting relationships and eventually become a stable revenue source. This doesn’t mean smaller opportunities are ignored, but rather, is more about deciding which ones are worth it. Even if it is a somewhat easier service, it still takes time. The time that could have been spent closing a bigger deal. Time is, unfortunately, something that once spent, cannot be recovered.
Why is time wasted on these small opportunities? This is because this is a live opportunity that needs action then and there. This helps keep the pipeline alive and show activity. This provides us with a sense of security that business is going as usual. This makes agents busy and takes away from time that could have been spent prospecting or nurturing existing clients.
Take a look at how many services you provide for one rental property over a 12-month period. Evaluate the related time spent executing these services along with the cost of staff associated with each activity. Combining these two you can work out your Return on Time Invested (ROTI).
This includes everything from:
The template downloadable below can help you work out what your Return on Time Invested would be. This is calculated by the average annual income of one rental property compared to how much it costs for you to deliver all these services. You can use this template for several different scenarios that suit your business.
Things to keep in mind are that there will always be certain things that are unavoidable and not every minute can result in financial return. However, the benefit of this exercise is that it helps you work out your Return on Time Invested to see the following:
So how do you work on improving your Return on Time Invested? First things first, rank each service based on importance.
In sales and letting, the most productive investment of your time is time invested on the phone with potential or existing customers. Sales calls are important in finding new opportunities and nurturing existing clients. These activities produce a high return on investment. Other activities include time spent with the team that delivers for your clients, time spent nurturing relationships, and time spent prospecting.
You can’t spend every minute on high return on time invested activities. But you can improve the amount of time there.
Take Lisa for example. Lisa is a letting manager at her agency L&S estate agents. She found that even though her negotiators were getting many leads, and were many viewings per day, she found that her negotiators just were not able to keep on top of everything and that lead to targets not being met. So Lisa set out to figure out what her negotiators were spending the most time on. After some thorough research, she noticed that negotiators were spending a lot of time on viewings. What she soon realized was that a lot of the time was wasted waiting for the applicants to show up to the viewing.
On average, every week the negotiators wasted about 2.5 hours waiting for their leads to come to the viewings. About 30% of these applicants actually came back and rescheduled a viewing, the other 70% did not. Across her 4 negotiators, this meant 10 hours of wasted time. That was an entire days work being wasted waiting on applicants that 70% of the time were not going to turn up.
What the negotiators and Lisa didn’t understand was that the time that was being spent waiting for these applicants could have been spent following up with more interested applicants. Valuable hours were being wasted which lowered the Return on Time Invested by almost 15%. By working on implementing basic changes Lisa was able to turn this around and ensure that her negotiators were making the most of their time and thus generating more revenue for the business.
At XChange, we help independent agents like Lisa grow their businesses by giving them the resources to compete with the Big 6. We connect them to the premium properties that are usually reserved for the Big 6 agencies. We work with local agents because we believe that they have the power to find homes for their customers better and faster than the competition. We know that if given a better source of properties, agents can outperform the bigger agents.
Want to get in touch? Send us an email or give us a call.
Find us in London
868 Salisbury House
London Wall, London
020 8064 1431