Let’s be honest, starting out a small business is never easy. Keeping one afloat can be even more difficult. There are approximately 2.1 million small businesses operating within Australia. Of those, 54, 992 business went bust in the 2018 financial year, a 12.7% increase from the year before. On average, 60% of Aussie small business close their doors in the first three years.
That’s the doom and gloom side of the coin. So we know – starting out, and keeping an Aussie small business afloat is harder than it may look. But with the right tools, knowledge and expertise, you can launch a successful Real Estate Agency and reap the rewards of being a small business owner.
That’s the flip side.
One of the first and foremost priorities as a small business owner is to ensure a solid financial position and to keep costs low, and cash flow positive whilst starting out. It is all about keeping your costs low until the money starts rolling in. Then you can look at business development opportunities and use your capital to grow your business. But, let’s not get ahead of ourselves. Let’s start at the beginning with our tips to keep your real estate agency start-up costs low so your business can grow.
Our Top 5 Tips to Reduce your Real Estate Agency Start-up Costs
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Plan
Every business starting out must have a solid business and marketing plan. This plan will detail your business products and activities, competitor analysis, financial forecasts, marketing plan plus loads more. You can download a free business plan template to help you get started. Take the time, put it all down on paper – it will help guide your decisions and curb your initial spending in the start-up phase. Put your efforts into free networking and marketing using your social and professional networks. Work with who you know and what you have until you can afford paid advertising.
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Office Space
Office space can be a huge drain on your finances. Can you look at alternatives in the start-up phase? Virtual and remote offices are becoming more and more the norm. Find good staff and allow them to work remotely to keep costs down. You’ll save on rent, electricity, water, gas, heating and insurance to name a few.
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Staff
We all have grand plans for our new business in the beginning. We want customers knocking down our doors with so much work thrown at us we don’t know where to start. The reality is, this takes time. Take the time to establish your agency and ensure you can afford the staff you are hiring. Outsourcing is a fabulous way to meet your staffing needs in the beginning. As your business grows, you can reconsider hiring internal staff or a combination of the two.
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Software & Equipment
Do your research before committing to any software programs or equipment. There are loads of software programs on the market – some better than others. Find the one that matches your business needs and that suits your budget. Don’t take on included extras you don’t need as this can save you thousand in subscription fees. Our team are experts in software training so get in touch if you want the advice from those who have trialled and tested many! Likewise for equipment – don’t go overboard too quickly. All those additional office items can wait until you are seeing some cash roll in. Start with the necessities and build from there.
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Know your Compliance Obligations
If you nail your compliance obligations from the beginning you are already setting yourself up for success. The aim is to avoid any breach – especially in your first year. By doing your homework you will ensure you avoid any breaches and hefty fines which will hurt your bottom line.
We hope these tips help you to identify how to keep your real estate agency start-up costs down and get you on your way to building your new business. If you’d like an Angel to help you along the way, contact our friendly team today.
Jane Morgan is the Director of End of Month Angels, a consultancy firm specialising in Trust Accounting. Jane knows the legislative requirements of running a successful Real Estate office through her 23 years industry experience. Don’t trust just anyone with your trust accounting. Book an appointment with an End of Month Angel today.