There are no guarantees in life – except death and taxes, right?  Which means there are no guarantees that your real estate business will succeed.

If you’re not sure if your business is going to succeed, then what’s the point?

And when times get tough in your business (and they WILL), you begin to doubt yourself.

So, it would be useful to know if your business is LIKELY to succeed?

There is a way to determine whether your business is LIKELY to succeed…

I’ve created a 4 point checklist to help you discover if your business is likely to succeed….

1. Is There A Gap In The Market?

Although I don’t believe in researching your competition, I do believe that your business needs to meet a need that isn’t already met in your marketplace.  This need is the “Gap”.  Remember, the Gap might be anything!  It might be:

• Price point (this isn’t my favourite “gap” to fill, but it’s a legitimate gap still)
• Money back guarantee
• Particular service levels (remember, they need to objective and measurable services)

Or it might be something else!

Part of having a successful business is meeting a gap in the market that isn’t already being met by anyone else.

2. What’s Your Business Model?

When you first start your business, you need to know what your model is.  Once you know what your model is, you can determine whether the model is sustainable.  Ask yourself: “Is My Business…”

• An Owner/Operator Business – where the plan is for you to always work directly with your clients, be the main contact, and perhaps never use a physical office, staying mobile
• A Traditional Small Agency – where you manage a couple of hundred properties, have a few staff
• A Larger Agency – managing 800+ properties, likely to have multiple offices
• Something else? Perhaps your goal is to launch your own franchise group?

3. Do You Have Enough Capital?

Once you know what your model is, you can determine how much capital you’ll need to get you to “break even” and then how much you’ll need to get profitable.

The best way to determine how much capital you’ll need is to use a cashflow forecasting tool.  A spreadsheet is a simple way to do this.  This cashflow forecasting spreadsheet can allow you to put in all your expenses, your forecast growth rates (remember, they need to be realistic growth rates), and this will allow you to see how much money you’ll need each month, and how much total capital you’ll need.

4. Are You Committed?

You’re going to experience failures and setbacks in a new business.  There will be moments (trust me, many moments) of doubt.  You need to be committed enough to push through these setbacks and doubts.  If you’ve got the drive to push through, you’re in with a VERY GOOD chance of succeeding in your business!

I’ve prepared a spreadsheet, titled How Much Capital Will I Need?  This is fully editable spreadsheet that I ACTUALLY used in my Rent Roll Business.  You can download this spreadsheet for free here.

If you haven’t read my last blog, about Why Branding Doesn’t Matter please check it now now!