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The Number One Reason For Failure in the Financial or Real Estate Industries

Jul 30, 2008
A business is a lot like a living organism and part of the lifecycle of a company is the addition and departure of its staff. Human Resources calls "retention" the comparison between the number of staff who stay versus the number of staff who quit. "Churn" is another word for it, referring to the cycle of new staff replacing old. The real estate and financial industries are industries that experience a huge amount of churn.

In both industries, agents and brokers join and leave in droves, resulting in new faces each and every month at employee meetings. Why is that? How come these two industries experience so much churn?

Often, people join real estate or financial brokerage companies because of the promise of working your own hours or earning unlimited income. Indeed, those are compelling attractors and as long as those continue to attract people, both industries will see new faces arrive.

But why do so many leave? The number one reason for failure in these businesses is a lack of sales. Certainly that won't come as a shock to anyone and the more important consideration is the underlying causes. Why do agents and brokers in these industries lack enough sales to make their jobs rewarding? To understand that, we must work backwards:

A lack of sales is the result of a lack of selling. A lack of selling is the result of a lack of prospects. A lack of prospects is the result of a lack of prospecting.

When a high performer in these industries succeeds, it's not because they've mastered the latest technique or happen to have better listings or investments than their peers. More often, it's because they have a system that fills their pipeline and keeps it continuously full.

In other words, high performers in the real estate and financial industries have a system in place that generates a lot of prospects and then converts those prospects into customers and then transforms those customers into long-term clients. It all starts with prospecting. No prospects at the one end of the sales funnel equals no sales at the other end.

High performers will also tell you that the moment they stop prospecting may not be noticeable. But they will feel it a week or two down the road. And the reason that "newbie" brokers and agents fail is because prospecting is hard work and when they stop they don't notice it right away. (Unfortunately, when they do notice it, it could be too late).

So, if you want to be successful in the real estate or financial industries, you need to start with a great prospect-generation system. What that looks like depends on your target market and your own skills, but it needs to be robust and ongoing. It probably includes some face-to-face interaction, some telephone interaction, seminars, and online efforts. And, it requires relentless effort (and more effort after that)! As any high performer will tell a new hire - the number one reason for failure is a lack of sales... And the number one reason for success is an effective prospecting system.
About the Author
Aaron Hoos is an in-demand copywriter who writes effective, compelling content for the financial and real estate industries. Visit his website at AaronHoos.com to grow your financial or real estate business.
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