When you first began your commercial real estate career it’s likely your broker told you to decide on a specialty. Did you take his/her advice? Your broker was right, you know. Refusing to specialize will cost you money and I can prove it.
Specialize in Everyone. So you want to advertise to all businesses in your local city? Let’s say I’m a commercial real estate agent in Las Vegas and I want to focus on all businesses in Las Vegas. The mailing list of 83,000 leads will cost me $6,700. Whoa, whoa… I’m not spending $6,700 on a list! That one mailing will cost $36,500 in postage alone, not including printing and envelopes. No way, that’s crazy.
Specialize in a Single Field. Alright, the cost of advertising to everyone was outrageous, so let’s specialize a little more. I want to be an industrial commercial real estate specialist in Las Vegas. Purchasing the mailing list of 1,629 industrial leads will cost me $309.51. Phew, that’s better. But just sending these leads a monthly postcard will still cost me $17,200 a year. That’s a huge chunk out of my profits! Also, driving around to all the manufacturing buildings around town will likely cost me at least $250 a week in gas, that’s $13,000/year also out of my profits. I can’t afford $30,200/year on business expenses!
Specialize in a Single Field in a Particular Area. I hate driving all around town, so I’ll stick with advertising to Las Vegas industrial businesses that are within a 2-mile radius of my office building. Purchasing the mailing list of 246 industrial contacts will cost me a reasonable $74. And if I decide to mail a monthly postcard to these contacts it will only cost $2,900 a year! Also, I’m saving money by not driving far; it will likely cost $100 a week in gas, $5,200/year. I can afford $8,100 on business expenses, that’s not so bad. Leaves more money for me!
See how much you can save by taking specializing seriously? When you save money, more profit goes directly into your pocket. If you’re just starting out, you don’t have to refuse listings outside your target market, you’re simply advertising to the people you would rather work for. When you’re more established, however, I do recommend sending non-target clients to a fellow agent and simply collect the referral fee. When you take on too many clients out of your target market, you may find yourself unable to devote an appropriate amount of time to research their market. Take some time to sit down and see what’s most important to you.