Calling all Partners to The Discount Property Investor Podcast. In this episode, Dave and Mike are sharing what they do on the Partner Training Academy with their paid students. Visit: https://goo.gl/8RwUKY to learn more. Today we discuss the importance of CRM and follow up.
David: Alright guys, welcome back to the Discount Property Investor podcast. This is your host David Dodge, with co-host Mr. Mike Slane.
Mike: Hey guys, welcome back. It's been a little while since we have been publishing these, and we are going to get back on that strict schedule, that's the plan.
David: That's the plan.
Mike: That is the plan, we have to keep doing this, we love doing it, and we have been doing some other work that has been kind of distracting us. One thing obviously Dave and I are excited about, we published our book.
David: We did, got the book published. Check it out on Amazon guys, the ultimate guide to wholesaling real estate.
Mike: Super excited about that. We also wanted to do something a little bit different for this one. So we just finished up our Partner Training Academy call. That is kind of our mentoring program, partner training. We essentially want to partner with people on deals. That's kind of how we do a lot of our coaching. We help people through us, we have our little private Facebook group where people ask us a bunch of questions, they interact with the other students. We analyze deals for people. All sorts of stuff, so if you're interested in that check us out at DiscountPropertyInvestorUniversity.com. Obviously if you visit our website you will be able to click around and find a link to that. But the Partner Training Academy is an unbelievable value right now, check it out.
David: Awesome value.
Mike: We are not going to tell you the price but go check it out if you are at all interested in doing your first deal. We would love to help you guys to do that.
David: Just touch on it a little bit real quick. So the Partner Training Academy, again Mike stated, we want to partner with people and do more deals. A lot of people don't know what they are doing, they haven't done a deal. So we are going to train you, then give you the ability to partner with is. Now the cool thing is, if you think-- or you think you can do it on your own, great. Or our training is enough and it's all you need, great. You are not required or obligated to partner with us. However, if you want to, we are here to help. We will partner with you on these deals, or we will help mentor you through these deals, it is really up to you.
Mike: Yeah we will hop on the call and help negotiate a contract. At that point we are kind of partnering with you on the deal.
Mike: We will help you get the price to the max, then we will partner on the deal, say we will split the profit on it or something like that.
David: Right, this is a true win, win. This is a win for you all because this program is very cost-effective. Other programs are three, four, five, six grand. We just charge a monthly fee, again you can check it out on the website, DiscountPropertyInvestorUniversity.com. But again, we are going to train you, then give you the ability to partner with us. We are going to help you analyze those deals and really answer any questions you may have throughout the week, then last but not least we have a coaching call; a group call that we do every Wednesday at noon, that is noon central time, they are all recorded and archived. So if you can't make those calls you can listen to them. Also, we give you the access to a private community, where you can reach out to not only us, but our team, and other students, and ask questions within that community which is awesome because there is a lot of things-- I'm still learning stuff in this community all the time. People will come across a deal, it's a little strange, we will jump in and help them. Not only are we able to help them, but we--
Mike: I'm going to throw something out, we didn't talk about this ahead of time. But if you listen to this podcast, and you sign up for this in the next four weeks, I would probably say the next four weeks because these will be gone by then. We will ship out one of the books that we mentioned in the partner training call. You will know it is one of the books we mentioned in the partner training call if you listen on.
David: That's right.
Mike: So you have to listen on and find out how you will know it is one of those books.
David: I love it.
Mike: Because there are something very special about these.
David: Special additions.
Mike: Again, there is only about 150 of them. Again, once they are gone, they are gone. Once again, if you sign up, send us an e-mail, and let us know, hey I signed up for the course, send me one of those books. We will ship it to you absolutely free. I will do it on my dime. Because again, I think it's pretty cool.
David: Very cool.
Mike: I think you guys will too.
David: What we have done today guys is we just wrapped up a call. We do our calls every Wednesday at noon, these are group calls. We just wrapped up a call. A couple of people had reached out to us in advance saying they were not going to make it, so we didn't have a ton of people on the call. That's okay, it was actually great because Mike and I did a deep dive on a couple of things, CRM's, followups, the importance of CRM's and what really matters in terms of taking notes, creating tasks. Also we talked a ton about making offers, written offers on every single deal. We talked a little bit about as well about building a huge funnel, and having a system to follow, even getting to the point you need to outsource that followup. Followup is so, so, so important. So what we have done today is actually taken one of the calls that Mike and I have recorded for our community, we are going to give it out to the podcast-verse for free, so you guys can get a taste of what some of the things we do talk about on these weekly calls. Also, today was kind of an anomaly because some of the people were not able to make it. But these calls are live, so you call in and ask questions. We didn't have any of today, but usually we do. Usually we have several people on the calls.
Mike: That is part of the reason we decided to share it too.
David: Absolutely, because there is no private or personal information on this particular call.
Mike: Just us.
David: Just us. Nothing private about me, look me up. Everything is out there. So this particular call is a great example of what we have to share each and every week. If you join the Partner Training Academy, or want some more information just reach out to us, we will give you that information. But this gives you the ability to hop on the call with us weekly, and ask those difficult questions about marketing, or difficult questions about determining your repair estimates, or I am really struggling with making officers that make sense. Mike and I are here to help you, we want to help you. So we have created a program, again it is called Partner Training Academy. Why do we call it that? Because we want to partner with you. You are not obligated to, but we want you to, we encourage that. But in the beginning, though we are going to train you. We have a ton of online course that we usually charge $500 to $1000 for, but we are just going to give those away when you join, it's really awesome.
Mike: I forgot to mention this, there is another reason we call it the Partnership Training Academy. It's kind of the mindset that Dave really has and I truly embraced as well, which is we don't really look at competitors. Even people here at our own market.
David: Not at all.
Mike: We look at them as partners.
David: Strategic partners.
Mike: Because we are probably going to do a deal with them eventually, we are going to joint venture. So it's a Partner Training Academy. Without much further ado, let's go ahead and jump into that call.
David: Check it out guys, you are going to like it. If you want more information about joining, check out DiscountPropertyInvestorUniversity.com. Let's dive in.
Mike: Okay thanks guys.
(((( goes to call)))
David: Hey Mike.
Mike: Hey Dave.
David: Good morning.
Mike: Good morning, how you doing today?
David: Good, February 27th edition, Partner Training Academy.
Mike: Welcome back guys. Hopefully you are doing deals. If you need any help, you are contributing in the Facebook group, or reaching out to us, we are happy to help you guys as always.
David: Had a few people reach out recently that we were able to help. So if you guys are looking for some help please do the same, reach out, we are here to help you guys.
Mike: Another thing is, if you have somebody else you know who is hoping to get started in wholesaling, it's fun to work with someone else, referring them to us; we would love to have them as well. It's not much of a commitment, $99 a month for the academy. Bring someone else in, and I will guarantee you will double or even triple your business. Part of the reason why we are together, we are able to do more as a team. Again, there are always challenges that come with that. But again, we would love to have somebody else in here to help motivate you that is local, that is a good friend that can go through this training with you. We would love to talk with them, talk with you guys.
David: That's right.
Mike: So what are we going to do today, man? What we talking about? I know we have a lot going on.
David: Yeah so we published our book a couple of weeks ago. We have been finding little errors here and there, so we are still editing and modifying. However, Mike and I live by a motto, and that is, 'fail fast, fail forward'. Also with that being said, 'progress over perfection'. So with that being said, when it comes to the wholesaling business, and marketing, talking to sellers; don't strive to be perfect, strive to just progress, and be better every single day. Here is a good example for you guys. Here is our book, it's available on Amazon, okay? We spent probably close to two and half, three years writing this book, okay? Now, we ordered 150 copies, I am going to zoom our camera over so you can kind of see, on this book, alright? We ordered a bunch of these, alright? There you go, Mike, love it, love it, okay? So we ordered a bunch of these, right? We thought it was perfect. After giving some copies away to friends, we made some pretty major mistakes, guys. So here is a perfect example, page 1, page 1! The ultimate guide to wholesaling real state. I'm missing an E in there. Another huge, huge mistake every other page at the top. The ultimate guide to wholesaling real state. Our spellcheck did not pick this up because state is a word, and we want it to be real estate.
Mike: We have a cheap editor.
David: That's right. But you know what? We've fixed the problem. So if you were to go online to buy it now it's there. But we have ordered 150 copies for our office to give to friends, family and co-workers and all that type of stuff. We have probably sold 100-200 copies online with these errors. We don't really care, it's funny, we are sitting around laughing about it, because if we waited until this book was perfect, when would it be done?
Mike: It took us two years to get--.
David: We should have had this out in six months.
Mike: -- we were doing too much other stuff. It wasn't necessarily our biggest focus. Yeah if we ordered a couple of copies and proofread it 100% ourselves, it would be another year.
David: It would, because we would find little errors here and there. There are probably another 100 errors in this book, guys. But it doesn't matter. The thing I want to point out here is we are laughing about it, it's a joke. We made a mistake, we know we made a mistake, we fixed it. But again, if we didn't wait to publish this until it was perfect, it would never be done. Again, I want to emphasize; progress over perfection. Don't worry about getting it exactly perfect or exactly right, okay? What's important is that you are progressing. If that means you are progressing and starting to do some marketing because you're not doing it, start, who cares if you don't do it right, okay? Just do it. Same thing with talking to sellers, and repair estimates and determining your MAO, alright? You are never going to get this 100% right ever! Even me and Mike and this business. We have been doing this for years and we still make mistakes all the time.
Mike: We have probably passed on great deals. We have probably over payed for deals sometimes. We do it all the time, it's no big deal.
David: But again, if we over-analyzed everything we would be in analysis paralysis. Nothing would get done, so don't sweat the small stuff is really the point I want to iterate today. Marketing a huge point, don't sweat the small stuff, there is always going to be something wrong with this book, but I'm not going to wait for the next 150 copies until I have 50 people read it. I'm just going to go. When they tell me they have found errors, let me know, great, I will fix them. Guess what? If you order the book before we've fixed it, you've got a special addition.
Mike: That's right.
David: So progress over perfection, I'm going to say it one more time. Progress over perfection, folks. You have to start somewhere, don't worry about making it perfect, just do something. Mike? Anything you want to add to that? Do something.
Mike: Do anything.
David: Do anything.
Mike: Sometimes I will get in that pattern of-- crap we are not doing this right. You just get down on yourself and you're like, why? So what?
David: Do you think a couple of errors in my book are going to affect me doing deals? Hell no. It's funny though, I'm laughing about it. How could we miss that? It's pretty major, but it happens. Whatever, moving on, guys. Today we really want to focus this call on-- what did you say, Mike? Page 174 in our book? CRM's?
Mike: 178, the importance of follow-ups and CRM's. A little breakdown.
David: Got it.
Mike: This is something we emphasize second most over just the importance of marketing first and foremost, you have to start marketing. But the next thing we really emphasize is the importance of followup. Dave and I, the way we look at leads, when someone calls in and says, hey I'm interested in selling my house. So they are calling an investor, they know they are calling an investor. Our thought process is, this person wants to sell a house. They may or may not be motivated to sell the house, but they are interested in a cash offer. So they know there is something wrong with that house. They might not be ready to sell today, but we are going to keep following up until they are ready to sell, until they tell us to kick rocks, or they sell the house to someone else.
David: If they tell us to kick rocks we are going to wait a year. We are not going to bug them, but things change. So here is a perfect example of why we do that. We are not trying to spam people. But some people might not have the mindset of selling today, but a year later they do. A lot of times they thank us. I will even bring it up when I make my call, hey John I haven't talked to you in a year, when I talked to you last, you told me you were not interested and that might be the same today, thanks for taking my call, I just want to reach out, I'm still in the business of buying houses, I notice you still own this particular property, are you looking to sell it now? The answer could easily be no. But oftentimes the answer is, yeah I have given it more thought, Dave. Thank you for actually following up with me, it's something I need to handle. It might be a vacant house, might be a problem property. They may be distressed, the property may be distressed. There are so many possibilities for why they want to sell. Even though they may have told me in the past not to call them again, I open with the fact you told me not to call you again, so I am sorry about this call, however I am still in the business, and I know you still have a house and I want to help, I want to buy it. 50% of the time people are actually thankful that we didn't just delete their name and their number from our system. Man, I haven't talked to you in a year, you're right maybe I should consider this. A lot of good things can come from it. The only reason you don't want to be following up with people is if the house sold, or they are trulyupset. In that case take them off, no big deal. But it's very rare that someone will get on the phone and scream and holler and shout at us about it. They will typically ask nicely, I'm not interested in selling it, don't bother me. How we interpret that is, great we won't bother you tomorrow or next week, or even next month. But we are going to call you in 6-8-10 months.
Mike: It's funny how the brain works.
David: It is.
Mike: So Dave is talking about how people thank him and all this stuff. Literally that just reminded me of someone I followed up with last week. [00:16:58.08 - inaudible] sent a text message out. So I text message-- this was after I hadn't seen the house, had not talked to them for about a year and a half.
David: A year and a half, I want to emphasize that. Sorry Mike, I have to make a point. One and a half years later! That's huge!
Mike: So I just sent her a quick text, she said, yeah I will see if they are interested in selling right now. It just reminded me of Vicky and how I need to reach back out to her to see what the family said about selling the house. It's a great house, if we can get it foreclosed to the price that--.
David: What you offered originally 18 months ago, it's a good deal.
Mike: It's a good deal.
David: It's a good deal. Nothing has changed.
Mike: Yeah, so again I'm just reaching back out.
David: Correction, something has changed, the seller's motivation, and that's what is important.
Mike: They paid another year's property taxes.
David: Taxes, maintenance
Mike: Yeah possibly a mortgage, I don't have that in front of me. So again, this property is going to need who knows what, and they know this. The seller know this, mom has already moved out into a nursing home, or assisted living facility. That property is now a liability to them and they are starting to realize that. That's exactly why she is open to talking with us again.
David: You have got to follow up. Here is a good quote, guys. 'Not following up with your prospects is the same as filling up a bathtub without a stopper in the drain'. Okay? It is going to keep running and nothing is ever going to accumulate or build up. Again, the importance of following up with your prospects. The easiest way to do this is to put CRM in place, okay? If you have read our book, listen to any of our podcasts, taken our free wholesale course, or have listened to any of these calls previously, you will know that Mike and I are huge advocates and sticklers about follow up. Every single lead we get, gets entered into a CRM. What's a CRM? It's a customer relationship management software. There are tons of free options out there, there is even more paid options. We use one called Podio, we like it because it is simple and we can build on it. But you can use anything you want, guys. I don't recommend using a pen and paper. The reason is because they can get lost, it can get wet, it can get damaged. Use something online, in the Cloud that is CRM based, customer relationship management.
Mike: The reason you need a CRM, so I was going to say start with something simple, just use a calendar. Put a note in the calendar that says to follow up with Vicky in a week. The reason I don't say that is because then you need to have Vicky's name and number somewhere, notes about Vicky, notes about the property. It's a little bit too much to do just in the calendar app.
David: I totally agree. The other thing about the calendar app is you get behind, you might not see it, it gets moved around. A CRM, it is just going to show that task overview, it's not going to go away, you're not going to not see it. That's another great thing about follow up, guys, you don't have to necessarily be exact. If I say I am going to call you back in three weeks, and I don't get around to it for four or five, so what? I am the one calling back, none of my competitors are doing that. So just the fact you have the notes as Mike stated, and something to remind you to follow up with those individuals is super, super, super important.
So let's talk a little bit about Podio, why we use it. Again guys, you can use any solution that you want. There's SalesForce, SOHO, there's Podio, there are a hundred of them, thousands of them actually.
Mike: A shout out to Roy David here--.
David: Another great solution. But all of these systems, they all have two things in common. They may have a bunch of bells and whistles, maybe some that are simple, maybe some that are complex and have a huge learning curve. At the end of the day, there are only two things that really matter. One, as Mike mentioned earlier, the ability to take notes on that lead, or that prospect, or that person, or that property. Typical that's all in one place, that's in our leads app and Podio. So we take notes, we jot down the last time we called them, how that call went, what we spoke about, what may have changed from this phone call from the last phone call, which could have been days ago, could have been years ago. We just want to make notes. That way when we are looking back for the next time we follow up, we can immediately remind our self how that call went, what's the newest update? Have the brother in law/grandparents/children moved out? Is somebody moving in? At least it will give us something to stand on when we are making that call. We're not just essentially cold calling again. Sorry, spitting everywhere here. But again, notes are super important. It keeps you in the loop. It's one thing if you are working 10-15-20 deals to memorize all this stuff, right? But when you are working on hundreds of deals, in our case thousands of deals. It is humanly impossible to remember all these details, and all these notes, and when to follow up.
So number one, most importantly, the ability to take notes on these leads, okay? Number two, there are a lot of other things but these are the two things that really matter. At the end of the day, you could take all these other things out of this CRM and as long as I had these two I would be happy. The other one is just tasks. Mike, talk a little bit about tasks. Why are they important? What do we need them for? Why you need them if you're not using them?
Mike: Tasks are great. So depending on how intense you are, you could literally have tasks for everything you need to accomplish that day, depending on how much stuff you program into your CRM. But just for what we are talking about now, which is the following up with sellers; that in itself is the whole reason you need the CRM in my opinion. I mentioned throwing something in the calendar app, well what happens when Wednesday passes and you don't call that person? Well, that task--?
David: The calendar is always going to show you the newest in real-time.
Mike: So the CRM, we use Podio, Podio is great, there is a little checkbox with your task icon at the very top. You click on that, it's going to show you all of your tasks. It doesn't matter if they are expired, but the oldest one, like the one that is supposed to be done first. If you haven't done it, it says, hey dumdum you need to do this task, always on the top. You can scroll past it and look at current stuff. But again, you have still got that one out there that you need to do from six months ago, or whenever.
David: If it's not a super important one you feel you need to get to right away, leave it up there. Come back to it later, or click on it and put a new date in the future. Again, it doesn't necessarily matter if you are following these tasks to the T, I need to call them back next Tuesday at 3pm, that's irrelevant. The fact I made a task to call them back in the future is what's important, that's so important.
Mike: It is, and that's a great time to use the calenderapp. If someone says, call me next Tuesday at 3, put it in your calendar.
David: There you go.
Mike: That's a great way to use the calendar app with the CRM. You will see the task in the morning as a reminder, you will see it on your calendar as well. So again, use it in conjunction with-- use them appropriately.
David: There is a huge difference between somebody that is doing a lot of deals, and knows how to deal a lot of deals, and wants to do more deals, and is consistent, versus the newbie, the beginner that doesn't know, alright? This is the biggest difference. Even if we had that example where the guy said, call me next Tuesday at 3pm. I know I'm calling next Tuesday. But then Thursday or Friday of that week I see that I had that task and I call him, okay? If you just wrote that on a sticky note and lost the sticky note, when do you think you would get around to calling that guy back? If ever is really the main point there. Maybe you think about it in the future, maybe you come across some notes, you call him back. But having a CRM, having notes, having systems specifically the ability to create tasks for you to do something in the future, is going to set you apart from your competition, okay?
There is some stats that I want to pull up, Mike, do me a favor. Go into Google, you already have a browser open, let's review these stats; type in-- sale stats, that's all you need to type into Google, sale stats. Then click on images, it's that one right there, that's the one I want. It's the best. Let's review this guys, because this is super, super important, okay? When it comes to sales, okay? The first part is a little confusing, so I am going to skip over that. I like the bottom part, okay? 2% of sales are made on the first contact. So let's break that down and put that into the relation to our business, okay? We are going to send out a thousand pieces of mail, okay? We get a 2% response rate, how many people responded, Mike?
Mike: Maths is hard.
David: It's 20.
David: 2% is actually probably a decent response rate, it's pretty high from mail. So we sent a thousand mails out, we are going to hope to get 20 people call us, okay? Then from there, we are probably going to get a third of those which are actually decent enough for us to spend time analyzing or setting an appointment. The other two thirds, they are shopping, tire kicking, they are not motivated. We are still putting those in our CRM, but we are putting our follow up date way far. Three, six, eight, ten months, okay? So 13 or 14 or those, 13 of those are not going to be deals, not even close to deals.
Mike: Not today.
David: Not today. But we are still going to follow up with them and put them in. The other seven we are going to look at a little bit more closely, okay? We may set up appointments for those, we may just do a desk review, call them back and make an offer. So of those seven we may set two or three appointments, we may get one deal, we may not. But we may get one deal, okay? Well that leaves 19 other people that responded to us, okay? We may have called them back or set an appointment and didn't get a deal. But in our system we built rapport, and we have officially spent money to generate 19 leads, okay? That we couldn't turn into a deal today.
So here is where we get back to our sales statistics, okay? 2% of sales are made on the first contact, okay? So we have broken that down from what we do in our business in terms of marketing. Can also be bandit signs or online ads, whatever. We use letters, direct mail is just an example here, folks. You guys can follow. So 2% of those are going to be sold on the first time. That's 2% of 20 though really. The odds of us getting one on that is pretty low.
Mike: Really low.
David: Here is where it gets juice and fun. 3% of sales are made on the second contact. So you follow up with them again. You may get somebody who has a little bit of better interest. But not much is changing, okay? 5% of sales are made on the third contact. Still not a great numbers.
Mike: Not just yet.
David: But the number is getting bigger, right? Next two is where it gets important. 10% so double, it goes from 5 to 10% between your third and your fourth contact. So if you are not following up with people, how can you ever expect your sales to be better than 2%? It won't be, okay? So 10% of sales are made on the fourth contact. So review, 2%, 3%, 5%, now 10%, that's first, second, third and fourth contact, okay? Now we are going to jump from 4 to between the fifth and twelfth. So we are no longer doings ones, we are saying if you are following up between five and twelve times, the percentage of the time you are going to be able to close a sale will jump from 10% to a whopping 80%. So what does that tell you about sales in general? The odds of you closing on somebody in the first contact is very low, 2%. If you follow up with these folks, 5, 6, 7, 8, 9, 10,11, 12 times, if you can do that, the chances of you getting a deal from these 19 other people of the 20 people that originally came in is 80%.
Mike: It's so much higher.
David: So much higher. But you can't stop, you can't give up after the second or the fourth call. You can't stop when they tell you to quit calling them. You have to keep calling.
Mike: You have to be able to accept rejection in this job, in sales jobs in general.
David: If you don't like doing it, hire someone to do it for you. You can get a virtual assistant, which doesn't necessarily mean they are in a different country, they don't have to work at your house or office, or you can hire a real assistant, hire a friend. All you do is give them access to your CRM, you can use Podio, you can use anything you want. You create them a login or you even give them your own login, they go in and start making calls, start making notes. Then of course they create tasks on the way out, okay? So they make a call, they say they have reached somebody, they say they left them a voice mail or whatever, they make a little
note. Depending on how that call goes, or if they missed the call-- the receiver, they leave a not. And then they just create another task to keep following up. So we don't ever mark a property in our system as dead unless it's sold. If they say, quit calling, we just say future followup and put them on a long term one, which means six, eight, twelve month.
Mike: Full disclosure, we do comply with all federal registries. If they ask us to put them on our do not call list we will comply.
David: We will comply with that, right. But in this scenario people are calling us first. We are mailing them a letter, they are reaching out to us first. We are not necessarily [00:31:30.23 - inaudible] anybody. We are just answering a call or calling back a call we might have missed. From then, responding to one of our marketing--.
Mike: Also we are following up with people. This is somebody-- we might have gone out and looked at the house. So again, we are just saying, hey met you at the house, has anything changed? I would still like to buy it. That is Vicky I was talking about before, I met her at the house a year and a half ago. I walked through the house with her and her mom. We couldn't agree on a price then. So now I am just saying, hey--.
David: Let's just jump in, so you followed up today, did she respond back to you? Or did you just say, hey Vicky not spoke to you in a year and a half--?
Mike: I did that last week.
David: Last week, so no movement yet, do you mind if I read this?
Mike: Go for it.
David: Go up and let me see-- okay. In our CRM 18 months ago Mike had called her.
Mike: Want to see the CRM?
David: Sure, pull it up. Let's just run through this example, because this is a perfect example, Mike. There it is. This lead was created over two-- three years ago. Woah, this is even getting better by the minute here
David: Three years ago, put it on the time stamp. This was created June 23rd 2016 at 4.33pm. Again, this is information that is important to us, alright? We want this time stamp so we can look back and say, when we call-- what's her name? Betty?
Mike: Lily was the owner?
David: Lily, hey we spoke to you originally three years ago. We can look through out notes before we call her and say, hey we spoke a couple of times. Our first call was three years ago, and last time I spoke to you was eight months ago or whatever the case was.
David: That was awesome but we didn't give up. We called, we left voice mails. Called and spoke to them, they've called and we have missed it. All these notes are in our system.
Mike: It's funny though, because-- I spoke to her three years ago and sent an offer three years ago.
David: Let's run through all the comments real quick, not that many.
David: Go from the very top, three years ago.
Mike: So we have an affiliate who set an appointment for a walk through with Vicky.
David: Three years ago.
Mike: Vicky is the daughter. The mother is hurting financially--.
David: He left a note.
Mike: Mother was hurting financially, very emotional. Financially they needed the money to sell. Then he uploaded some Dropbox pictures.
David: Went out on the appointment, and that's what's in the notes about the appointment. Very emotional, however he took photos which we highly recommend you always do. Use Dropbox, use Google Drive, Google Photos for free and it's unlimited. So that is a great resource for you. You can sort all these into Cloud. Then if somebody wants to see the pictures you send them a link. You don't send them a text or an e-mail with 65 pictures, that's super annoying, don't do that. I just delete people's names out of my phone, can't handle it, right.
Mike: Affiliate was talking to me and said what should we offer? I called and I was making the offer.
David: Three years ago.
Mike: Three years ago. I sent the offer for 50,000.
David: Mike said I spoke with Vicky, sent her an offer in writing. We do verbals but we also follow up every single time we make an offer, we follow up with a written contract via e-mail. Why do we do that? I will tell you, super simple. We have automated this process, takes less than a couple of minutes to generate and send. B, if they come back later and really the only person that sent them an offer, no matter if they like that offer or not. We're the only person who sent them an offer. Let's say six months, a year, in this case three years later they circle back, who is the first person they are going to think about that A, serious about buying their house, and B, already committed to buying it, just not at a price that didn't work in the past? Us. That's why we send these offers; people will come back and say, hey is that offer you made a year ago or two months ago or whatever still valid? We will run our numbers and say yes it is, or I will send you an amendment or a new one that basically has the same terms.
Mike: Here is what I suspected with this lead, I am looking through the notes here. I sent the offer, I followed up with the offer a month later, hadn't heard from her, then we handed it off onto our virtual assistant, he started following up. He finally got a hold of her about a year after.
David: One year later. We went out on the appointment, took photos, built rapport, sent an offer, they were like kick rocks guys this offer sucks. It happens all the time. So what? We kept following up, kept following up, kept following up. A year later, Mike what happened?
Mike: So then Dennis calls and says they are going to pass on the 50k offer.
David: A year later.
Mike: Vicky spoke with her brother and they want something closer to 100,000. So then I said, okay that's great, let's just make it for long term follow up. If they want to list it and try to get that number.
David: Hold up, before you scroll down go up.
Mike: Because there is not a ton of follow up, you're ahead of yourself. So this--.
David: Well there was four. Four followups. Then we got them on the phone at that point, they didn't like it, they wanted double. We said, okay no problem. We can't do that but we are going to keep following up.
Mike: This is two years ago. Then we handed it over to our assistant Dennis and he is a machine when it comes to follow up.
David: This is a virtual assistant, why did we hire Dennis? A, we are too busy to do all the followup at this point, we still do a lot of it, but when we are working 2-300 leads at a time it is a full time job to follow up. So if you are new this and you are only working 50-100 leads you can do this yourself no problem. But as you scale you want to outsource the jobs that are easy to do, right? Because you don't have the time in the day. You are going to be running appointments, you want to be working on the business and less in it. Therefore you can scale and grow and make more money. You want to outsource these jobs in the future.
Mike: Right, so last-- I lost my train of thought.
David: Last January, Dennis started following up. Followed up once and left a voice mail, then again on February 7th, he called and left a voice mail. Again on February 13th.
Mike: We don't need to go through that again. On February, again in February, then again in March, then again in September. Then again in November, then again in January, then again in February, then again in April, then again in May. It looks like he got a hold of him and set an appointment. Looks like Dave you went out there.
David: Basically Dennis had set an appointment and I had commented, good work Dennis I will be there. But then I started reviewing the notes. Thank God for the notes. Thank God for the notes, guys. This is what I am going to beat into the ground. Like it or not because this is so important. I looked at my notes and said, oh it looks like Mike set a contract for 50k, what happened after that? Then Mike chimed in, this was a month ago. Mike chimed in and said, no clue it has been over two years, I will take back over this lead. I said, no problem, Mike, I am happy to help, wasn't trying to be rude, I just wanted to see if you knew anything I didn't. Was just making sure someone was on top of this lead. Let me know. Then Mike said, no worries I got it. He then called Vicky and instead of going on the appointment, said we had offered 50, we already have pictures, there is really no need for us to come back out. We have all the information we need. We are still interested in this property. It looks like Mike went from 50 grand to 60 grand on the offer, is that correct?
David: Cool, that was six days ago. We just went through three years of follow up, notes, tasks.
Mike: We don't have this deal yet either.
David: We don't even have the deal. We worked on this deal for three years. We have 2000 others like this, guys. If you have a lot in your funnel, in your pipeline, deals will start closing, they will start getting solved and fixed, and you will start getting these closed, which relates to you getting paid and making money. So last but not least Mike had sent her, hey we can make this up to 60 grand, and then she said she is going to talk to her family about it. Mike just sent her a follow up text 15 minutes ago. That's the current situation we are at with this lead, but we are not coming up to 100. Maybe that 50k offer was a little lower than we were willing to pay. Two or three years ago, but also understand when we make an offer, we are not going in at our MAO, okay? What is MAO, max allowable offer. So our MAO on this deal maybe was 60 or 65 grand. But if we offer 65 grand and that is the most we are willing to pay, and they want us to come up a little bit, we can't do it. But if we go in lower than our MAO, they want us to come up a lot, we might be able to do that. We are essentially trying to meet them in the middle, and by doing that we use a technique called anchoring. What is anchoring? It means I am going to go in extremely low, or extremely high, okay? Knowing that in the end I am trying to meet in the middle. But if I go in at 80 and they are at 100 what's the middle? That's 90. If my MAO is 65, and they are at 100, I really should have came in at 40. Then my middle is closer to that 65. You have to anchor low to meet in the middle. It doesn't always work in your favour, but often times it does, okay? You can kind of play with that on your own, just see what's working for you. But we-- the point is that I am harping on, don't ever offer your MAO, go below that, because that is essentially where you want to end your negotiations. Mike says this a lot, and I love it. The negotiation starts when you send them a contract, not before. When you're out looking at the property, looking at repairs, looking at comps. You're not negotiating, you are determining what you are willing to pay. The negotiation really starts, the beginning of it, is when they receive your offer. I love it when you say that.
Mike: Yeah-- it's the beginning of the conversation.
David: The beginning, not the end. It's the beginning.
Mike: Sending a contract is the beginning of the conversation. That is here you are really serious about buying the house, that is when they see you are serious about it. There is no-- again when you just walked up and said, hey I would like to buy this house, doesn't mean anything. In real estate things have to be written, have to have a written contract for it to mean anything. So again, you are just starting the negotiation process. If you think about a typical residential real estate transaction, you have agents involved, and there is always counter offers, there is always an offer, a counter offer, then there is an inspection period, then you have got inspection perquisites which is basically just negotiation prices again. You need to fix this or--.
David: I've just had to come off a seller concession, I got a rehab my wife is doing, the sellers were going to walk over 500 bucks. The original contract was accepted maybe three weeks ago. We are still negotiating on pricing. We don't close till the 22nd March. I wouldn't be surprised if there is one if not two more negotiations between now and then, always happens.
Mike: Just means the buyer is trying to get a little bit of a better deal.
David: Right. We do the same thing when we are on the buyers side. It's annoying when we are on the sellers side, but again we do the exact opposite, we anchor high, list the property for 10-15 grand more than we think it will sell for. You are going to have this problems, right. You want to try and meet in the middle, but again you need to anchor low or anchor high depending what side you're on. Therefore the middle is where you want to be, not way below it or way above it, alright? So yes, very important, that was a great taste of that deal. When you originally looked at that deal three years ago, sent someone out, took pictures and negotiated it, and now we are following up again after three years, trying to get this lady to agree to our offer.
Mike: I am going to make a note here to--.
David: That's what we do guys, we make notes, and we create tasks, that's it. Other than that we are analyzingproperties, we are looking at them, we are making offers. 90% of what we do is respond the to marketing that we send out and make notes on it. Because often times they are not motivated today. But in four months or eight months or 14 months they are. If we're there to be the solution to their problem and they need it, then it is a good deal for both of us. That's what's called a win win, okay? As a wholesaler your entire job, okay? You may not like what I'm about to say, but this is the truth. Your entire job is to solve somebody elses problem. That's it, okay? We are in the marketing business, you know that at this point. Real estate is our product, but our job okay is to solve a problem. Would you agree with that, Mike?
Mike: 100%. The problem properties, that's when you get in and make money as a wholesaler.
David: Make good money, because there is a problem you have a solution to. Win win.
Mike: This property again, let's look at this one. The problem is that is it not updates, it's old, it needs work, it's vacant. They have a property now they can't do anything with. They can't sell and list for 100,000. Yeah maybe that's what they want, maybe it's what it's worth when it's fixed up, probably is. Probably why our offer was 50, because it needs repairs. What I wanted to say or what I was just doing was adding a followup on this property. Dave, if we get this under contract we should use this as an example, we will talk about it again. So I just put a note in there.
David: If we close it, we are going to come back and going to do a case study on it, a three year old deal. We do three year old deals all the time, guys. This is not abnormal, okay? I think the average time it takes us to do a deal is probably four to six months on average. Now, that is the mean, the median is a totally different number, that is probably eight or ten months. The reason the mean is way less than the median is because we do get the one day deals. That draws the-- it brings the average down, okay? But the median if you don't know, look up the difference between the two is probably seven or eight months.
Mike: They take a while.
David: They take a while, absolutely.
Mike: Again, we are cash buyers so we close fast. We can legit close very quickly. They still-- when we get to title we have to bring our closing-- our contracts to the title company. It still takes a couple of weeks, even the best title companies-- it's going to take them a week or so to get your paperwork prepared to do a closing. There is no overnight selling of real estate, a liquid asset. That's part of the reason why we have such advantage in this industry is because we are able to close much faster than a traditional buyer. I'm digressing.
To wrap up today's calls, any question on there, it doesn't look like it. Let's go ahead and wrap up, what do you say?
David: Absolutely. I am just going to do a one minute recap, guys. Then we are wrapping it up. Get a CRM if you don't have one, get away from the sticky notes, get away from paper, even if you are just doing a couple of little deals a month, start now running your CRM. Podio is a great tool, they cap it at either 100 or 1000 leads for free, then there is a paid one we are part of. You can find any CRM, it does not matter which one. I am not promoting Podio, however I do like it a lot. You use what you want to use, it doesn't matter. Tasks will keep you from forgetting about these people. You have to follow up, we just talked about this. You go from 10% on the fourth followup to 80% of the sales between your fifth and twelfth. So you can't stop, if you want to be successful you got to followup a lot, okay? Then last but not least, task and comments. Comments, why would you not want to be in the loop on these calls that you're making, or if somebody calls you? This happens all the time, another perfect example. I may not talk to somebody for four months, and they call me back, all of a sudden they are motivated, and they are looking for my services. They call me back because I have already spoken to them several times, okay? But guess what, whenever that phone call comes in I say, hey Jim do you mind holding on for 30 seconds while I grab my laptop? They don't ever care, they are not in a hurry if they are motivated. I pull up my Podio CRM, I type in Jim's name, number, e-mail, anything, address, searches everything. All CRM's do. I am going to pull it up and I am going to say Boom! Last time I talked to Jim was two months ago, we spoke about his daughter who was getting ready to have surgery, and I will just browse my notes and then immediately my rapport is back at level ten, and not level one, two or three. I can say, Jim thanks for letting me get my computer, I have all my notes in front of me, how was the surgery with your daughter? Oh Dave it actually turned out really good. Jim I am so happy to hear that. Do you see how that changes everything that I know what we talked about last? If you don't have a computer or CRM, you will never be able to do that with 200 leads, it won't happen.
Mike: If you are working with one or two maybe. If you've got hundreds of leads to follow up--.
David: CRM's. Followup, use the task, make a lot of notes, that's all there is to it guys. You will increase your sales statistics and closing ratios, 2,3,4,10%, up to 80% if you don't give up. That's what it comes down to. You can't give up, you have to be persistent, keep going.
Mike: We all love the low hanging fruit.
David: Here's the thing about the low hanging fruit. The more business you do, the more marketing you send, the more low hanging fruit you are going to get. It's a numbers game. But if you don't do marketing, any of it, or not enough of it, the odds of you getting that low hanging fruit are that much less. It all comes back to marketing. one thing I said earlier that I am going to reiterate again now is make offers on every single property. We made an offer last week asking 100 grand, we offered him $15,000, do you think he was happy with that offer? Hell no! But once he realized over a year or two that no one else is going to pay him more than 20-25 grand, that he is just crazy thinking he is going to get 100 grand, that 15k offer is going to start looking better and better and better. So we didn't just make it verbal, we sent an e-mail with it in writing as well. So hopefully that will circle back, it might take a year or two. But that's the nature of the game.
Mike: We're fine with that.
David: That's it guys, that's all we've got today. Check out our book if you're interested, reach out to us if you have any questions. We are here to help, we have helped a couple of people over the last two weeks with some little stuff here and there. We are really ready to help you guys get that first deal done if you haven't already. So reach out, we are here to help, we are signing off. Until next time, we will see you then.