I have said it before the numbers ARE extremely important.
I would never advocate a deal where the numbers didn't work so that you could feel good about yourself, get the first deal under your belt, or quite basically for any other reason including "trying to help someone out.
" I had to say that upfront so no one gets the wrong idea.
You can help others but do not do it as you put yourself out of business.
Doing a bad deal once to help someone out may cut your career short enough that you won't be able to help out anyone else.
My biggest concern when Lynn and I do the show is that everyone gets on a one track mind and it is all about what am I getting out of the deal.
We spend a lot of time teaching or having guests come on the show instructing you on the mechanical points of investing; how to get the best deal on a house, how to get your contractor's prices the lowest, how to protect yourself against bad tenants.
Of course these are the important factors in doing well but there is the other side of the business.
The other person.
We truly do spend a lot of time thinking about that also.
We don't really do it because it makes us feel good or because we are trying to be better people.
Hopefully that is what we just do naturally.
Instead we do it because it makes good business sense.
Think of some of the most successful, or rich, people in the world.
What did they do?Bill Gates created a software program that he forced computer companies to install and then was able to charge a bunch of money for it and after that developed a lot of other software to run on his system that no one else could create.
Believe it or not that is not what Gates did.
It sounds good and it makes the underdog in you feel good.
Bill Gates asked the question, "Who has a need and how can I fill it?"The answer was IBM needs an operating system and I know just such a system I can buy from someone else, tweak it and sell it to IBM to fit their needs.
(Side note:If you don't like the idea that Gates found a need, bought it from someone else with little work on his part and then sold it to someone else for more money you may want to stay away from most forms of real estate investing, as these are the basic tenets.
)Bill served someone else and became rich in the process.
As monopolistic as Microsoft seems the way they beat out Apple was by providing everyone else with the source code for their system.
Gates told everyone else how to write programs for Windows and they flourished.
Microsoft Office and others did well because he put large teams of people together, again, to find a need and fill it.
There were many other productivity suites developed in the early 80's but most of them focused on developing a system from the programmer's standpoint (remember Wordstar where you basically had to be a programmer to use it?) Microsoft and Gates took a different approach, they found out what the average person needed and filled that need.
They stepped into the user's shoes and cashed in big time.
There might be a lesson in that.
Whether you are buying a home from a home owner or a bank the question becomes, "What is their need and how do I fill it?"You can read all of the home study courses you want (I do recommend that also, this is not an either/or approach) and get the technical details but if you sit down with a homeowner and ramrod your ideas through and TELL them what you are going to do for them your success level might be limited.
This is why Lynn does well with sellers.
She wants to know what they want.
We won't go into too much detail here.
She will be talking about this a lot at our "Turn the Key on Real Estate Investing" weekend event.
I will say it starts with them and ends with them (the homeowner).
If you find the need and fill it they will be happy with the outcome, no regrets or second thoughts.
If they feel like they have been taken then you need to be concerned.
The same philosophy works with the rest of your support staff.
I know they work for you and they should be concerned about filling your needs; bare with me.
Most people will go through the process of getting 3 estimates and go back to each of the contractors to get the lowest price from each of them.
Probably to the point that you are able to get the guy with the least business knowledge and the one who needs the work the most.
Does that sound like the makings of a superstar employee?I definitely recommend shopping around to make sure you are getting a fair price.
Is the guy that is willing to go the lowest the one you want? Beating someone else up does not make them feel the best.
What if you asked each what their schedules are like and when they could start and finish, ask what would work for them.
You may find that if contractor A, the one you really liked, could start a week later he could lower his price because he would free up himself from another job.
Sure it is a week later but I have made the mistake of taking the cheapest guy who could get to it the soonest because he had nothing else to do.
It took him two weeks longer to finish because he had nothing to do after he finished my job.
If I would have asked what he needed I would have found out.
He needed work because no one else wanted to hire him.
Again don't do a bad deal because it is helping someone, don't over pay a contractor because they want more money.
Do start with the question, "What do you need?"Servicing others is the beginning and end of success.
You can't be in it just for yourself.
It won't take long until that system crumbles.
Home owners refer their friends to us when they need to sell their homes.
They do it for a reason and the reason wasn't that they felt like they got taken when we bought their homes.
Keep that in mind the next time you are analyzing a deal.