Hey everyone, welcome back! It’s Casey and Ryan here with another episode packed with value. Today, we’re thrilled to have Scott Hoots join us, all the way from sunny California. We’ll be diving into essential topics like consistent deal flow and boosting your deal spreads from $30,000 to over $100,000. Let’s jump right in!
The Importance of Consistent Deal Flow
Most investors, whether they’re wholesaling or flipping, struggle not with getting their first deal but with maintaining a steady pipeline of deals. The key to a thriving real estate business is having a continuous flow of deals.
Never Stop Marketing
A common mistake many new investors make is halting their marketing efforts once they land a deal. They get so wrapped up in closing that they forget about keeping their pipeline filled.
Marketing should be an ongoing activity. This means investing money continuously into marketing channels:
- Direct Mail Campaigns: Sending out postcards and letters.
- Online Ads: Using PPC (pay-per-click) campaigns and social media ads.
- Driving for Dollars: Finding properties while out and about.
A Strong Team for Lead Flow
Having a dedicated team to manage inbound leads can make a huge difference. Scott emphasizes the importance of seller support and figuring out their needs. This helps in moving leads efficiently through the process from initial contact to closing.
Strategies for Consistent Marketing
Frequent Mailouts
Regularity is key. Scott’s team sends out around 30,000 pieces of mail weekly. This consistent approach ensures that leads keep rolling in without a hitch.
Experimenting with New Channels
While direct mail is their bread and butter, Scott’s team also experiments with other methods like text messaging and pay-per-click ads to diversify their lead sources.
Scaling Up
As your business grows, so should your marketing efforts. Adding more staff and fine-tuning your systems can help manage an increased number of deals without overwhelming your team.
Overcoming the Shiny Object Syndrome
One of the biggest pitfalls is getting distracted by new, flashy marketing tactics. It’s tempting to chase every new strategy that comes along, but Scott advises against it. Stick with what’s proven to work and be systematic in testing new methods.
The Role of Company Culture
Fostering a Positive Work Environment
Scott’s office is far from ordinary. It’s loud, engaging, and dynamic. This unique culture keeps morale high and no one has quit in over two years!
Building Cohesiveness
From tossing footballs and donning boxing gloves to regular team outings, these activities help build camaraderie and accountability. Employees are not just coworkers; they’re friends who look out for each other.
Separating from the Competition
Rapport Building
Instead of focusing on the house and its flaws, Scott’s team builds genuine connections with sellers. They chat about the seller’s life, look at family photos, and make the conversation as personal as possible.
Comfortable Setting
Sitting down on a couch with the seller rather than standing or sitting at a kitchen table makes a difference. It makes the negotiation feel more relaxed and less like a business transaction.
Asking for Their Perspective
Before diving into numbers, Scott’s team asks the seller what they’re hoping to get. This simple question can provide a lot of insight and make the negotiation smoother.
Increasing Deal Spreads Through Rapport
Establishing Trust
Building trust and likability can yield larger spreads. People are often willing to accept lower offers from someone they like and trust.
Managing Objections
Once trust is established, handling objections becomes easier. Sellers feel more comfortable discussing their concerns, allowing Scott’s team to address them effectively.
Additional Strategies for Bigger Spreads
Minimum Spread Goals
Scott has set a minimum spread goal for commissions and bonuses. This motivates his team to push for higher spreads, knowing they won’t get commission on anything below $15,000 but can earn significant bonuses.
Continuous Seller Support
Supporting the seller throughout the closing process ensures a smooth transaction. A dedicated transaction coordinator can make a big difference by keeping the seller informed and comfortable.
The Power of Visualizing Cash
Illustrating Spread Value
To illustrate the value of deals, Scott once spread $40,000 in cash on the conference table. This visual aid helped his team better understand the value of even the smaller deals, reinforcing that all money is valuable.
Re-framing Mindset
Visualizing physical cash re-frames the team’s perspective on deal value. It’s easier to dismiss a $5,000 deal on paper, but seeing the actual cash makes it real and significant.
Rapport-Building Tips
- Ask Engaging Questions: Go beyond the deal. Learn about the seller’s life.
- Be Present: Listen actively and show genuine interest.
- Overcome Fear of Rejection: Get comfortable hearing “no” and use it as a learning experience.
Scaling to New Markets
Thorough Research and Preparation
Entering a new market requires thorough research. Scott’s team is expanding to Dallas and has spent the last year planning this move.
Leveraging Existing Strengths
They plan to replicate the successful strategies from California in their new market while being open to adjustments based on local conditions.
Utilizing the Team’s Strengths
Scott’s team is moving to Dallas to ensure a strong start. The success in California gives them a solid foundation to build upon.
Closing Thoughts
Consistent deal flow and increasing deal spreads are achievable with the right strategies and mindset. Focus on continuous marketing, build a strong team, and create a positive work culture. Don’t underestimate the power of rapport building with sellers. Remember, every “no” brings you closer to a “yes.”
For more insights and tips, follow Scott Hoots on Instagram @theScottHoots and stay tuned for future episodes. Happy investing!
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