Setting Up Your Real Estate Investing Business – The Business Setup Checklist

Since I get over 1,000 real estate investors coming to my various real estate investor websites and registering with me each week, as you might expect, I get quite a few people asking me how to get started investing in real estate.

When my business was smaller and I was just running my own real estate investing business and our local real estate investor group meetings, I used to sit down and meet with investors that asked me this question individually. We’d go to lunch at my favorite burrito place and I’d ask them many questions.

I’d want to know about why they wanted to invest in real estate, what they expected to get from it, how they thought they’d be making money as a real estate investor, how much time and money they planned to invest in themselves and their real estate investing business, what their business and investing experiences had been so far, and so on and so forth. After a couple dozen of these meetings though, I noticed a pattern in what I suggested to each of them (and yes, it really took that many meetings for me to notice this pattern): I suggested that each one of them get started wholesaling real estate.

After I told them that they should wholesale real estate first, I’d then run down–very haphazardly–a list of the things they needed to do to get started in their real estate investing business. A few years have passed since those first meetings and the first time that I made a quick list of how to get set up investing in real estate. Over the years, I’ve had quite a few people get started in the business based on those meetings with me. So, in this article, I’d like to share with you my Business Setup Checklist for Real Estate Investors.

In the Business Setup Checklist, I am not going to have you spend tons of money at first to lease an office, purchase expensive computer equipment and otherwise commit to lots of expenses with no proven income from your business. Instead, I will share with you what I believe to be the most important things to do and to purchase to get started in your own real estate investing business.

First, I believe you need to take time to sit down and decide where you are going. Stephen Covey says, and I agree, that you should “Begin With The End In Mind.” It is much easier to accomplish a goal if you know what you are trying to accomplish. Please, do yourself a favor, and don’t skip this critically important step.

Second, setup, or at least figure out, the minimum telephone communication system you will be using. Many times, it will be using your cell phone (and changing the message from something unprofessional to something more business-like). Of course, there is a wide range of telephone services you can setup. Start very basic, spend very little and expand as revenue increases.

Next, I am a big believer in using 24 hour recorded information lines in my marketing and so I do recommend paying the money to get this set up. With these, you can spend less on marketing and then have people call in to get more information about buying, selling, renting or private money before talking directly to you. You’ll be tempted to bypass this step and use regular voice mail (remember I’ve helped lots of other people get started investing in real estate) and that would be a mistake.

The next step is the MOST IMPORTANT step of all: get your marketing and get it out. Nothing happens until you start talking to motivated sellers in this business, so you need to get them to call you (or start calling them). So, take some time to figure out your basic marketing. Depending on your budget, you may also consider getting a website and bandit signs at this point as well. If you are on a tight budget, use the free website route and skip the bandit signs until later.

Once you have your marketing and are starting to get it out, you should then be getting organized and ready for seller calls. Make your Seller Presentation and Credibility Pack. Setup your office files to track income and expenses, marketing files and property files. Also, make sure you have the files and forms you need stored in your car. You never know when you might need to write up a contract and better to have them with you in your car at all times, then to miss out on a deal.

And finally, set up your business entity. The reason I recommend this last is because most people will stall on this step and unless you have assets to protect, it is a mistake to get hung up on it to begin with. If you have significant assets to protect, you should meet with your personal attorney at the start of any new business to get personalized, professional advice relating to your unique situation.

Overworked, Overstressed, Too Busy to Get Organized – How to Transform a Growing Business

I can see it coming. Maybe I’m developing a sixth sense for it. I run an operations management business and I regularly get calls from business owners saying; “I need your help. My business is taking off and I feel like I’m losing control”. The first question I ask always seems to be the toughest for them… When can we get together to talk? I’ve learned to anticipate that they will cancel one or two appointments before we’re actually able to meet. I plan for our first meeting to be away from their office so I am able to get their full attention.

Their business has typically been operating for three to five years, which means their business model is working for them and has begun gaining traction. They’ve passed the infant mortality point where many new businesses fail and have had some taste of success. They’re now at the point where they’re starting to think about taking their business to the next growth plateau.

The business operates in a mostly ad hoc mode. Up to this point they’ve managed to keep things on track by shear force. They’re beginning to realize that they can’t do everything themselves and they continue to hold things close because they feel they have to maintain control by personally making every decision. They’re not willing to delegate anything but the most trivial tasks. “My entire life is tied up in this business and it’s succeeding because of the energy I put into it.” They have in fact become the operations infrastructure of their business and they’re beginning to realize that they have now become the primary constraint on the growth of their business. Take a vacation, a sick day, a coffee break… Not likely!

Transforming these businesses requires an objective look at two areas: their organization and their operations. I start slowly by trying to find some activities the owner is willing to offload to others.

Businesses at this point in their development are usually organized on the “Conestoga Model”, meaning their organization chart looks like a wagon wheel. It’s a person centric organization model where the owner has become the hub of the wheel with all of the other functions circling around the hub. They may have made some attempt to change things themselves but I often find they were unsuccessful because they delegated responsibility without being willing to also delegate the authority to do the job.

The next step I take with clients in these situations is to begin transforming their organization to a more traditional hierarchical model. This is a difficult step for them because it means they have to be willing to delegate the authority to complete tasks along with the responsibility for completing them.

Completing the organizational change requires more than simply creating an organization chart. The new organization has to be designed to meet the businesses needs and to make best use of the resources at hand. Each block on the organization chart should have a defined mission statement and a set of goals. Owners who are already over burdened often revolt at the thought of doing all of this “useless paperwork”. “We have real work to do.” This a great place to recommend they bring in their new first line managers or supervisors to help and it also lets these people take ownership of their new roles. This is the point where I usually have to expand my role from working with the owner to working with their staff. Including the first level managers and supervisors in these activities has an amazing effect on the culture of most businesses once the staff realizes that the owner is saying I trust you and am relying on you to help grow my business. Kicking off the new organization can be difficult. “You mean I work for her now? But I used to work for the owner.” You have to plan to hold a lot of hands and mend some hurt feelings as you go through this exercise.

After the organization is in place you need to define a sustaining operations infrastructure for the business. You do this by assessing the businesses operations, identifying weak areas needing definition or improvement. I begin this by formalizing the workflows of the business. Remember, the operations infrastructure has to be able to support the restructured business in the future. I divide the operations infrastructure into the nine areas described below. Each area controls a major workflow through the business so, by definition, each infrastructure area crosses organizational boundaries. Don’t, for instance, limit the sales and marketing infrastructure to the sales and marketing department.

CUSTOMER SATISFACTION: The customer satisfaction infrastructure has to be designed as an integral part of the business operations and not simply included like a facade over the front door. Every employee needs to learn their customer satisfaction role. The customer satisfaction infrastructure defines the role of functions such as product support, requirements definition, and quality assurance.

PRODUCTION/SERVICES: The production/services infrastructure defines the methods that will be used for the delivery of all products and services and ensure that this is being done in a safe, compliant, and consistent manner capable of bringing all products and services fully to market.

INFORMATION MANAGEMENT: It would be a tremendous understatement to say that all businesses today are information intensive. The information management infrastructure includes the IT systems but can be much wider in scope.The information management infrastructure defines the methods for protecting all business data, the electronic tools that form the backbone of the business, printed material and all media that is used to support the business. All personal privacy and security controls need to be addresses here.

SALES AND MARKETING: The sales and marketing infrastructure supports the businesses primary goal; to sell products and make a profit. It defines the methods used for everything from pricing and lead flow needed to support the sales pipeline to the methods used to develop new products and markets including the use of competitive and strategic analysis as assessment tools.

ORGANIZATIONAL: The definition of the organizational infrastructure includes the formal and informal structure of the business. It includes the organization chart that forms the command and control structure plus the informal structure that becomes the culture of the business.

PERSONNEL: The personnel infrastructure defines the working relationship between the business and its employees and between employees including the roles and authority of the management team. It defines the benefit strategy and compensation plan plus the procedures for hiring, firing and everything in between.

FINANCIAL OPERATIONS: The financial operations infrastructure forms the framework for all financial operations of the business. It defines all financial authority and controls including AP/AR, payroll, cost account and project management, plus the definition of methods to be used for budgeting and projections.

LEGAL OPERATIONS: The legal operations infrastructure forms the framework for all legal operations of the business. It defines all legal authority, professional licensing and controls needed to support the business on a continuing basis. It defines all activities used to protect the business from legal risk and liabilities and to ensure the compliant operation of the business.

INSTITUTIONALIZED PROCESSES: The institutionalized processes infrastructure includes the definition of all formalized policies, procedures and methods that guide the businesses operations. Methods such as ISO, CMMI, Six Sigma, Enterprise Risk Management (ERM), Lean or Quality Management Systems (QMS) where the business needs certification to qualify for a market driven process are defined.

It is important that the infrastructure areas be documented but this doesn’t mean it has to be a voluminous set of policies and procedures or that it has to be completed overnight. The infrastructure needs to be formalized to be effective and repeatable but applying the “Keep It Simple” approach works well here. Complex procedures don’t get read so plan to start light and build as needed in the future. After base lining each of the infrastructure areas (and training employees on their use) the final step is to establish a continuous process improvement program so that the infrastructure will continue to evolve along with the business.

The actions described in this article can be intense for a small business because it strikes at its culture. The cost of transitioning the business to support its next level of growth will be offset by the improved efficiency and through the resulting decrease in operations risk. It may not be an immediate goal of the owner but these steps are an excellent way to position the business for a future M&A event or to raise investment funds to support the additional growth.

Attending Fashion Design School Can Make All the Difference in Your Future

Success stories about people who accomplished their goals or achieved fame and fortune with only minimal education are few and far between. The more education you receive, the better your chances are for success – not only in the fashion world but in anything else you try to achieve.

What are some of the benefits of attending fashion design school? How can it make a big difference in your future?

You will receive the knowledge you need to help you reach your goal. Throughout your educational process, you will constantly be learning new things or reinforcing those things you have already learned. When you finally walk across the stage at your chosen fashion institute, it will be with the assurance that you now have a knowledge base that will serve you for as long as you are in the fashion design business.

While some things about fashion design can’t be learned, most aspects of the industry can be, and this is why you are attending. It’s true that a good eye for design and color, as well as overall taste, cannot be taught. However, taking courses in such things as Textile Design, Introduction to Color Theory, Design Sketching, and other subjects can help you expand on what you already know.

Having a degree in fashion design will give you an edge when you start applying for positions in the fashion industry. In fact, that degree may be the first thing that a prospective employer looks for. For some positions, having a degree will be a job requirement. While it might be possible to obtain a position in a company that does require this, it’s probably going to be a lot harder to do so than if you already have the degree.

And lets face it; you will learn more than just fashion design. A well-regarded fashion college teaches basic college courses, business courses, and other classes. As with any other career, you may have to start at the bottom level, working more in the business side than the fashion design side for instance. Because you have knowledge in other areas, you will be able to do that, something that will not go unnoticed when opportunities for advancement arise.

A good fashion school, such as those that can be found in Los Angeles, can make a big difference in your future. Providing you with the best fashion design education possible will be their highest priority.