“I’m not making any money. The economy is killing my firm. I’d be lying if I said I wasn’t in anything but survival mode at this point. My New Year’s resolution this year is to be able to make a 2011 resolution with a roof still over my head.” (Charlotte business owner)
“Creativity without implementation is irresponsibility.” (Ted Leavitt at the Harvard Business School)
“In a typical game we want to have between 90 and 105 possessions, and we try to get that number up as high as we can, because if I’m better than you are, the more possessions we play, the more likely it is that I’m going to beat you. If I play golf against Tiger Woods for one hole I might beat him, but over 18 holes, I have no chance.” (University of North Carolina Basketball Coach, Roy Williams, from "Hard Work: A Life On and Off the Court")
Roy Williams is one of the greatest college basketball coaches ever. Besides winning 2 national championships in the last five years (2005 & 2009), his accolades are mind-blowing: 594-138 record in 21 seasons, Hall of Famer, 7-time Coach of the Year, 1st in winning percentage among active coaches (81.2%), 3rd best winning percentage all-time, only coach to win a NCAA Tournament game in 20 consecutive seasons, and the list goes on and on…
What makes him so good? There are many reasons obviously. But the one that I want to focus on is that he is incrementally better. What the heck does that mean? And what’s with the italics again? Well, it goes along the lines of his quote on top of this article. If you play UNC long enough, they should be able to beat you. They have great coach, talent, and system. UNC doesn’t blow out every opponent, but they do win most of their games. For example, in the 2005 NCAA Tournament in which they won it all, they beat their opponents by 28, 27, 1, 6, 16, and 5 points respectively. They were good, but didn’t win every game by 50.
The reason is the essence of the game of basketball. It has fixed rules. There are only so many points you can realistically score in a 40-minute game, and your defense cannot fully stop a talented team from scoring. Basketball is a “fixed pie” meaning that there are usually a certain amount of points scored in a game. If you have just one more than your opponent, you win!
So let’s say your business is really good and always takes 80% of your city’s market share. Last year, there was $10M in sales (fixed pie) and your firm predictably took in $8M of that. Awesome stuff! But this year, sales have shrunk to $8M (smaller fixed pie), and your firm made $6.4M. That is still good, but not as good as last year. So maybe good old Roy has got it better than you? He wins 80% of is games over his career and is a Hall-of-Famer. You take 80% of market share this year and your shareholders are wondering whether it’s time to find another CEO to run things.
But maybe, just maybe, you have it better than Roy. Roy is locked into a “fixed pie” scenario and you’re not. In business, if you don’t like the pie you’re eating out of, you can shift to another pie. Or you can be eating several different pies at once (sort of like what we’re all doing this holiday season, even those who have sworn off sweets).
In real estate, most were eating out of the brokerage (buy/sell) pie. You were just like Roy, incrementally winning by keeping a steady market share in a growing amount of business. Your 80% market share was nice when your city’s brokerage pie grew from $10M to $12M ($9.6M in sales, up from $8M the year before. Yeah, baby!) There was more than enough pie for all and everyone was happy! Then the housing market fell apart and there was less pie for everyone. Some went hungry and left the business. Others started rationing their smaller portion while complaining about how hungry they were.
But you’re not Roy and stuck in his world! You can use innovation and change the game! As I’ve written before, people still want to transact real estate; the American dream of homeownership is still alive and well (arguably even stronger!). Macroeconomic conditions have made it necessary to transact real estate through other methods like rent-to-own, rent-to-sell, owner financing, short sales, or any other way you can think of! These pies are growing and taste pretty good! And there are less forks banging together trying to take their piece of it out!
If Roy could legally add more methods to score, he would. I’m sure he would create his own version of “Calvinball” (yes, a Calvin & Hobbes reference) and start blowing teams out by singing “Thriller” while throwing a horseshoe over the backboard (10 points!).
But, alas, Roy is stuck between the baselines with fixed rules and one fixed pie, so you can easily beat him! Are you ready to eat heartily from some different pies in 2010?
Brett Furniss is the President & Owner of BDF Realty, “Charlotte’s Most Innovative Property Management & Investment Company”specializing in rent-to-own (lease options) and rent-to-sell homes. You can follow his Twitter thoughts on the Charlotte real estate market by clicking on http://Twitter.com/BDFRealty. He is the author of the FREE E-Manual entitled “How to Rent-To-Sell Your Own Home” (http://www.RentToSell.com/RTS-Book.html) which details how to get the most potential buyers to your home in this challenging real estate market.
“Creativity without implementation is irresponsibility.” (Ted Leavitt at the Harvard Business School)
“In a typical game we want to have between 90 and 105 possessions, and we try to get that number up as high as we can, because if I’m better than you are, the more possessions we play, the more likely it is that I’m going to beat you. If I play golf against Tiger Woods for one hole I might beat him, but over 18 holes, I have no chance.” (University of North Carolina Basketball Coach, Roy Williams, from "Hard Work: A Life On and Off the Court")
Roy Williams is one of the greatest college basketball coaches ever. Besides winning 2 national championships in the last five years (2005 & 2009), his accolades are mind-blowing: 594-138 record in 21 seasons, Hall of Famer, 7-time Coach of the Year, 1st in winning percentage among active coaches (81.2%), 3rd best winning percentage all-time, only coach to win a NCAA Tournament game in 20 consecutive seasons, and the list goes on and on…
What makes him so good? There are many reasons obviously. But the one that I want to focus on is that he is incrementally better. What the heck does that mean? And what’s with the italics again? Well, it goes along the lines of his quote on top of this article. If you play UNC long enough, they should be able to beat you. They have great coach, talent, and system. UNC doesn’t blow out every opponent, but they do win most of their games. For example, in the 2005 NCAA Tournament in which they won it all, they beat their opponents by 28, 27, 1, 6, 16, and 5 points respectively. They were good, but didn’t win every game by 50.
The reason is the essence of the game of basketball. It has fixed rules. There are only so many points you can realistically score in a 40-minute game, and your defense cannot fully stop a talented team from scoring. Basketball is a “fixed pie” meaning that there are usually a certain amount of points scored in a game. If you have just one more than your opponent, you win!
So let’s say your business is really good and always takes 80% of your city’s market share. Last year, there was $10M in sales (fixed pie) and your firm predictably took in $8M of that. Awesome stuff! But this year, sales have shrunk to $8M (smaller fixed pie), and your firm made $6.4M. That is still good, but not as good as last year. So maybe good old Roy has got it better than you? He wins 80% of is games over his career and is a Hall-of-Famer. You take 80% of market share this year and your shareholders are wondering whether it’s time to find another CEO to run things.
But maybe, just maybe, you have it better than Roy. Roy is locked into a “fixed pie” scenario and you’re not. In business, if you don’t like the pie you’re eating out of, you can shift to another pie. Or you can be eating several different pies at once (sort of like what we’re all doing this holiday season, even those who have sworn off sweets).
In real estate, most were eating out of the brokerage (buy/sell) pie. You were just like Roy, incrementally winning by keeping a steady market share in a growing amount of business. Your 80% market share was nice when your city’s brokerage pie grew from $10M to $12M ($9.6M in sales, up from $8M the year before. Yeah, baby!) There was more than enough pie for all and everyone was happy! Then the housing market fell apart and there was less pie for everyone. Some went hungry and left the business. Others started rationing their smaller portion while complaining about how hungry they were.
But you’re not Roy and stuck in his world! You can use innovation and change the game! As I’ve written before, people still want to transact real estate; the American dream of homeownership is still alive and well (arguably even stronger!). Macroeconomic conditions have made it necessary to transact real estate through other methods like rent-to-own, rent-to-sell, owner financing, short sales, or any other way you can think of! These pies are growing and taste pretty good! And there are less forks banging together trying to take their piece of it out!
If Roy could legally add more methods to score, he would. I’m sure he would create his own version of “Calvinball” (yes, a Calvin & Hobbes reference) and start blowing teams out by singing “Thriller” while throwing a horseshoe over the backboard (10 points!).
But, alas, Roy is stuck between the baselines with fixed rules and one fixed pie, so you can easily beat him! Are you ready to eat heartily from some different pies in 2010?
Brett Furniss is the President & Owner of BDF Realty, “Charlotte’s Most Innovative Property Management & Investment Company”specializing in rent-to-own (lease options) and rent-to-sell homes. You can follow his Twitter thoughts on the Charlotte real estate market by clicking on http://Twitter.com/BDFRealty. He is the author of the FREE E-Manual entitled “How to Rent-To-Sell Your Own Home” (http://www.RentToSell.com/RTS-Book.html) which details how to get the most potential buyers to your home in this challenging real estate market.
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