Erich Scharf

Home Inspection-Repair-Buying-Selling

15

6

REALTOR-INSPECTOR-INVESTOR

I am merging three different jobs that I curently do: Realtor - Inspector - Investor. I am working through how to creat a central product or service that would leverage the three key fields that I work with in the home ownership cycle. 

I think the center point of the home buying process could very well be a consumer APP for tracking the purchase, inspection, repairs, and sale of one house. So that buyers could keep all their information about their home in one location online that is accessable by mobile APP and computer.

Assignment One. 

NOTE: This is my current business model because at this time I am not sure what I really need to build a new business model to leverage my key assets and get out of the business of freelancing (doing all the work myself and getting paid when I show up) to entrepreneurship (building a scalable business that runs when I am not there).

I am going through the class and thinking about what I have in terms of assets and how to build new revenue streams based on the assets and relationships I have. Also I do not want to go into debt to transition.

In ten sentences or less, write down your business model:

This is my current business: I advertise online, hand out business cards, and send out a newsletter to local Realtors twice a month. Customers sign up on line for a home inspection and I drive out and do the home inspection.

List the assets you have or will acquire:

I have a website, list of local realtors, my home inspection vehicle, and some tools.

I personally have an ability to build websites, SEO for websites, set up email newsletters online, ability and experience to train home inspectors.

List the human resources you will contribute or hire:

Looking to hire home inspectors.

Describe who your customer is and what the customer gets from doing business from you:

Customer is the home buyer. They get a home inspection report and verbal review of the property if they are at the house at the time of the inspection or if they call me to go over the report online.

And finally, outline what part of this is hard, which part is unique, and how you're going to repeat it again and again.

NOTE: This is my current business model because at this time I am not sure what I really need to build a new business model to leverage my key assets and get out of the business of freelancing (doing all the work myself and getting paid when I show up) to entrepreneurship (building a scalable business that runs when I am not there).

Remember, you don't have to invent a unique business model. In fact, you should probably steal one that's already working for someone else, somewhere.

MY FIELD 
I work as a home inspector and also a Realtor. So I am involved in various ways with the home buying process and also with the repair process after the home is purchased as many customers will call me to help with repairs (finding a local contractor) or general questions about their home after they move in. 

OPPORTUNITIES FOR GAME CHANGERS:
Most of the home buying process works with very out dated cross marketing between parties because of liability issues and control issues within sections of the industry. The term "Realtors"  refers to members of the National Association of Realtors. In many ways is like a union. Realtors are generally three to five years behind other industries in terms of technology and mostly everything. A large part of this comes from the fact that successful Realtors have a large pool of referal business from past customers and have no need to get involved in social media or marketing. 80% of the home sales come from 20% or less of the Realtors. A similar situation applies to the home inspection industry and the home repair industry. 

CONSUMER NEEDS: 
1. Buy house 2. Repair house 3. Sell house

GOALS FROM THIS CLASS: Clarify ways to improve the current services I am performing, define clear process to "build the business" instead of "hiring myself." Identify revenue streams I can build within the sales process of Buying, Repairing, Selling homes that I can introduce on a shoestring budget.

POSSIBLE PRODUCTS, SERVICES, BUSINESS GROWTH GOALS:

1. Shift from owner operator to muli-inspector company. 
2. Build APP to leverage relationships through out the home ownership cycle.

ASSIGNMENT 2 

NOTE: My main business is as a owner of a one person home inspection service in Sacramento, CA. I have to build my ability as a freelancer and at the same time transition to being an entrepreneur so I am working on both right now.

If you're a freelancer, write down precisely what you will do to:

  • Ensure a steady stream of work: Do quality home inspections and reports. Build relationships with new people throughout the home ownership process. Find a way to cross the traditional business practice in real estate that is hidden in the phrase “conflict of interest” by building an online platform so all parties in the home ownership process can communicate more and help people take better care of their homes.
  • Create an environment where you don't go crazy and melt: I have an online schedule so I can set my time and refuse to take rush orders and focus on high value customers.
  • Consistently raise your prices, increase the quality of your work and generate a waiting list for your time (at the same time).: Improve the quality of  the home inspection (more pictures and descriptions).

 If you're an entrepreneur, write down how you will:

  • Relentlessly hire people to delegate work to: I am now thinking WHO I want to hire as I am  not just a home inspector, but also a Realtor, and a repair person. So I am looking to create a NEW category, one that I can be number one in since I am starting it. So I am in the research stage now. Just learning the right questions to ask through this class as I flesh out my strategy.
  • Give yourself a promotion so you are constantly doing work you're unable to hire anyone else to do: Build a network of  home care professionals that serve the needs of  home owners for the entire time they own their home, not just when something is broken.
  • Build an organization that has the cash flow to permit you to do those two things...(holy crap this class is worth it just so I can now realize the right questions I need to ask.) 

    MY CONCLUSION AS OF NOW: In order to generate cash I have to keep up my job as a freelancer but I need to improve my game. At the same time I would like to become an entreprenuer and build a scaleable business in my industry. Some of the key points I would like to hit: 
    1. Very Niche Market.
    2. Create a new category that I can be number one. 

I think the center point of the home buying process could very well be a consumer APP for tracking the purchase, inspection, repairs, and sale of one house. 

2. Freelancing vs. Entrepreneurship –

 

If you're a freelancer, write down precisely what you will do to: I still have to pay the bills as a home inspector so I would like to transition from doing all the home inspections myself to training other people to do the home inspections.

  • Ensure a steady stream of work: this can be done from increasing the marketing and from increasing the quality of the home inspection.
  • Create an environment where you don't go crazy and melt: The first step is to organize my time and limit the amount of home inspections I do myself. I am training one home inspector now so that he can start to take the overflow work. One option is to build a system to take the salary out of the equation, make it commission only for the home inspectors that work under me. That way I can focus on building a marketing channels to generate home inspection business. One way is to hire appropriate people who can do home inspections part-time along with other real estate related work. Such as home inspectors who currently have other sources of income in the industry and flexible schedules like: Insurance inspectors, Realtors, Contractors who do installations that take only part of the day.
  • Consistently raise your prices, increase the quality of your work and generate a waiting list for your time (at the same time).
    This is doable.
  •  

If you're an entrepreneur, write down how you will:

  • Relentlessly hire people to delegate work to: I am starting to hire people to do the home inspections. As I build other revenue streams I will need to do that also.
  • Give yourself a promotion so you are constantly doing work you're unable to hire anyone else to do: This could be done by hiring part time home inspectors who are paid commission only.
  • Build an organization that has the cash flow to permit you to do those two things... yeah that’s the thing that takes time to build the cash flow to allow me to do that. Even if I start a small revenue generating service that is only $1600 per month then it could free up time to leverage more of  my time to work “on” the business instead of “in” the business. One thing is to choose the revenue stream to start that can be duplicated and outsourced. 

ASSIGNMENT 3 FUNDING

1. Fund your business

I am not looking for outside funding at this time. I am looking for ways to grow without spending money. I am thinking about leveraging current skills and assets to build without spending money. 

Create a page or more that answers the following questions as completely as you can:

Do you need money for this business?

No. I thought I did, but then decided 2 years ago to start paying cash for everything and paying off all debt (shout out to Dave Ramsey). So I had to get creative. I started looking at business models that pay on commission (Real Estate Agents, etc…)

Does more money increase the chances you will reach positive cash flow? Profitability? Not at this point.

If I had money to buy assets that would produce money...It would be better to build without going into debt or giving away ownership. I am thinking more along looking for creative ways to grow the business without going into debt.

What are the assets the money will go to pay for?

How long before the money invested starts turning into money returned?

Do you hope to sell this company? No

When?

For how much?

What is the gross margin of what you'll be selling?

How long will it take you to reach scale?

Given all this, and what you learned in the video, what sort of funding are you seeking? Why would this investor choose your offering over all the others available?

 

4. HIRING 

ASSIGNMENT 1 Commit to a hiring plan

If we can agree that a key part of your business is going to be your people and what they contribute, can we also agree that some hires are better than others?

In this part of the 7-part plan, you're going to commit (not just describe, but commit) to what your human resources look like.

  • Who are the first employees you need? Realtor/Home Inspector/Investors that work on a commission only basis.
  • Where will you find them? OK. I know craigslist bites, but it might work if I am very specific about qualifications: 1. Must be a Realtor 2. Must have home inspection experience or construction background. 3. Must have a desire to become a real estate investor. I might also try within the real estate investment community here in Sacramento.
  • Why would they join you? More stability and better long term revenue. I am creating a different model for home inspectors & Realtors. Helping them get into the real estate investment business. 
  • How will you tell the good ones apart from the convenient ones? Their current book of business? Willing to invest money to help develop their territory (maybe ask for money up front for training? hmm...they need "skin" in the game.) How about setting a 5, 10, 15 year goal in terms of revenue from home inspections, revenue from real estate sales, and number of rental properties with passive incomve?
  • What's your funnel?
  • After hiring people, how will you evaluate them? 
  • How long after starting will you give people a formal review?
  • What's your approach for talking about the uncomfortable?
  • Are you asking people to do work that's been done before, or to explore the edges of a new universe? Explore the edges of a new universe. 

5. NAMING

This is a tactical exercise in digital marketing and storytelling (don't use the word branding, please).

    • Make a list of thirty words that describe things that remind you of how you want your business to make people feel. They might be colors or animals or emotions or holidays or relationships or historic figures...
    • For each word on the list, make a list of five more words that remind you of (but aren't exactly about) that word.
    • Now you have 150 names. Start running single ones through wordoid and combinations through nameboy.
    • Repeat until you find an available dot com domain. Grab it in Hover!

6. PARTNERS: DELENEATE YOUR APPROACH TO PARTNERS.

Consider the following:

    • Who else is helping you start this thing?
    • If they stopped working on the project in a month, would that be okay?
    • How much are you actually hoping they will contribute, today, tomorrow and year from now?

Create a spreadsheet, listing each prospective partner. Under their name, list every thing you're hoping to have them do, in the long run and the short run.

On the same spreadsheet, make a different section where you list the hierarchy of how decisions are going to get made.

In the video, we'll talk about how to take these two components and combine them with the financing page of your guide to come up with an equitable plan for sharing the upside.

7. CASH FLOW: UNDERSTAND AND CONTROL CASH FLOW AND PRICING.

Answer these questions, in writing!

    • How much is your product or service going to cost?
    • How much does it cost you to make one additional unit?
    • How much is your monthly overhead, all the expenses that aren't included in the cost of making one more unit.
    • How many units are you going to sell every month?
    • Now you know what the monthly profit is (IF you sell all you make, ANDpeople pay on time).

Some questions, then:

    • What would happen to your numbers if you increase your retail price by 20%? 40% Lower it 10%?
    • What would you have to change about your business to get people to pay in advance? To subscribe? How much more could you charge if you gave them credit?
    • For the first six months of your business, what if you committed to being much smaller but only had clients that paid upfront?

8. POSITIONING AND STORYTELLING: 

The power of stories that stick. How your story changes your strategy, your marketing, your pricing and more. Understanding the x/y analysis.

Draw an X/Y axis.

Label the horizontal and then the vertical.

In each quadrant of the axes, place your competitors and other alternatives on where they stand.

Now, find the empty spot and there you go.

If you can't find an empty spot you can live with, draw different axes.

1/25/14

Been reading the E-myth. Updating the logo below. From left to right it shows the life cycle of buying a house and also the different areas of interaction in the sales process. Still working on how these five aspects will be connected. I am looking at creating a five year sales cycle that can be contacting the customer once a month and adding value every month. One thing that this will do is greatly increase the value of each customer.

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