Business Planning for 2021

The year 2020 has been packed with challenges. In economic terms alone, the coronavirus pandemic has forced many businesses to fold, but at the same time, interest rates were low and the real estate industry was busy with the only constraint being inventory.

What can we expect for 2021? Will there be a financial crash that will stall the real estate market? We can’t predict the future, but home inspection business owners can put a plan in place to ensure that any changes in the market do not have a significant negative impact on their bottom line.

One thing that hasn’t changed over the years is that home inspection is a relationship business. As home inspectors, we must maintain good relationships with the clients who hire us and the real estate agents who refer us. During the past several months, as our communities and our businesses have been affected by the coronavirus pandemic, it’s been tough to create and nurture new relationships, but it is not impossible. I’ve always been an advocate of getting into real estate agency offices and meeting people, but with that option off the table, you have to find ways to be creative in getting the attention of prospective clients and agents.

Back in 2010, local and mobile-oriented digital marketing strategies were in their infancy. In 2021, using the right mix of social media platforms is an important and effective way to grow your business. The right mix really depends on your demographics. For example, if you are in a community that attracts the 55 years and older age group, then Facebook is still viable. If you’re going after Millennials to be your clients, it may be a combination of Facebook, Instagram and YouTube. You may want to consult with a social media marketing company that specializes in the real estate industry to determine the best mix.

Your Business Plan for the Next 12 Months

Updating your business plan or creating a new one is not difficult. A plan can be one page or 100 pages, based on what your needs are, the level of detail you desire and what will work for your business. I break my business plans into the following six areas: analysis, goals, budget, tactics, timing and metrics.

Analysis

Take a critical look at your business over the past year. It’s important to understand what’s happening in your marketplace and how your company has been doing. Ask yourself these questions:

• What is working well?
• Where is your business coming from (ads, internet, referrals, real estate agents)?
• What are your company’s strengths?
• What is working well for your competitors?
• Where do you feel you are losing business?
• Are there business opportunities that you haven’t been taking advantage of (specialty inspections)?
• What is your cost of doing business?
• Where are your greatest costs?

Goals

Establish goals for your company. What do you want to accomplish in 2021? Many small business owners will say, “I want to have $250,000 in sales,” but I suggest that your goals should be more granular than that.

Let’s say your overall goal is to make $250,000. To reach that much in sales, you need to determine what smaller goals you will need to accomplish. Typically, you will have five to 10 smaller goals that support the overall goal. Consider the following examples of smaller supporting goals:

• “I want to post videos on social media every week.”
• “I want to be the first inspection company in the Google search results for my town.”
• “I want 30% of my business to come from past customer referrals.”
• “I want to have 40% of my gross sales business come from the internet.”

Budget

Plan your marketing budget. Over the years by talking with other inspectors, I’ve learned that many home inspectors spend very little time or money on marketing. According to small business experts, small business owners should be spending between 8% and 10% on marketing. If you plan to have $120,000 in gross sales, then you should budget $800 to $1,000 per month on marketing.

Tactics

Outline your tactics to describe the steps you need to accomplish each goal. For example, if your objective is to gross at least $10,000 per month, then you should have several tactics to support that objective.

Tactics are well-defined tasks that have results that can be measured easily. For example, to get to the top of the Google rankings, you will need to do things such as have your website optimized for search engines and regularly post on social media. To stay on track, I recommend creating and following a calendar. These are all tactics to help accomplish your goals.

Timing

Make a schedule to track when you want things to happen. Because some tactics are time-sensitive, timing should definitely be a component of your overall plan. I usually create a calendar that lays out my business’ marketing activities. This timeline covers my goals and tactics for each month. I post this timeline next to my computer so I can always remind myself of what I committed to for that month or quarter.

Metrics

Measure your success or failure. This step of data review is critical to executing your plan. Once a month, I review my business results in coordination with my plan to see what is working and what parts of my plan need more of my time and focus.

Many business owners overlook metrics and instead focus on whether they accomplish their big goal. In a dynamic environment such as real estate, missing your goal can be frustrating. That is why you should also measure the success of your plan by looking at each of the individual tactics and goals. Looking at these individual components helps you judge how your plan is performing during the business year and then tweak the under-performing areas.

For example, by using an effective reporting system, I can look at the source of my customer referrals on a monthly basis and decide if I want to increase the scale of my marketing campaign to include past clients or to put more money into my Google AdWords budget.

Create Your Plan Now

Many home inspectors let the business drive their actions instead of them driving the business. This is easy to do when the phone rings and you’re working long hours. But what if we see another 2007–type crash or if the market stalls in your area? Without having a plan, it is next to impossible to be in the driver’s seat. If you want to be in the driver’s seat, you will need a plan to tell you where to go.

The opinions expressed in this article are those of the author only and do not necessarily reflect the opinions or views of ASHI. The information contained in the article is general and readers should always independently verify for accuracy, completeness and reliability.