Business Plan

Real Estate Career

For Guang Xia Liang

Date: July 18, 2021

1
Table of Contents

Presentation 3

Company overview 3

Agency selection 4

Market research 5

Market planning 8

Operation plan 9

Financial plan 10

Identifying financial and business needs 10

Summary 13

2
Presentation

The exclusive summary will outline the business for a beginner of real estate agent targeted in
Montreal market in Quebec. The summary will start with local market research, then to identify
the advantages and disadvantages as a freshman of real estate agent, to follow through certain
strategies and tactic plans, and hopefully by due diligent, it will help with the career by
following through this guideline.

Company Overview

Initially, I will need some guideline from experienced agency for the first few transactions. My
plan is to associate with an agency and to set up the corporation for the business. Before
moving into the market research, a SWOT analysis will help clarify the direction of what the
business needs as well as personal needs.

Strengths

 Construction background with knowledge and experience

 Network of designers and sub-contractors to maximize potential values of future
properties.
 Experiences on rental properties and rental laws
 Customized marketing plan and design to attract targeted clientele
Weakness

 Start-up with little experiences on various perspectives – document management,

communication, and time management
 Limited resources and need time to understand various procedures.
 Lack of experience on negotiations with other experienced brokers
 Lack of custom base
Opportunities

 Underserved markets for specific products, i.e., maximization of potential values of the
house by functional designs and minimum renovations as a full service
 Integration of my current resources and design a special package of service that I can
offer and differentiate from other brokers.
 Online presentations/Omni Channels to promote the real estate business.

3
Threats

 Emerging competitors
 More restrictions/regulations on the competitive environment
 High maintenance cost on keeping the existing customers

The market of real estate is emerging and uprising. It will never disappear given people always
have needs for better home and accommodations. The numbers of brokers are not yet reached
to a saturated level with current 15K professional real estate brokers serving the Quebec
region. I am optimistic on my career path towards successful real estate business.

Agency Selection

I have approached two real estate agencies – Charismas and Sutton Excellence. They are two quite
difference on fee structures. See attached table 3.1.

Table 3.1

The span for this marketing plan is 3 years. My goal is to achieve $25K (4 transactions) in year #1, $80K
(8 transactions) in year #2 and $120K (15 transactions) in year #3. I put above two fee structures into
my earning scenarios, see attached table 3.2.

Table 3.2

4
With projected costs per year, I will say Charismas has lower cost structure but lack of support. To grab
the market rapidly, I will need enormous supports from the agency on various subjects. The annual
cost delta is not major if I can have enough reserved funds on the side. I am expecting to spend a little
bit more but gain full supports from the agency, which has long existing and trust-worthy branding.
Specially, for mentoring, I will need help from an experienced agent to guide me through the first few
transactions to avoid any mistakes. Also, by choosing Sutton, I might get benefits from referrals from
other provinces or territories because of the mass base of agents within the same brand.

Of course, I will gather more information on different agencies, compare and conduct the same analysis
here to further refining my research of agencies.

Market Research

Montreal’s real estate market is uprising. People are adapting the new norms – remotely working
under the covid situation, moving out of Centreville and looking for more spacious house/apartment
in rural area to live and enjoy.

A professional real estate broker, the primary goal is to help prospective clients to get their dream
place in the desired neighborhood. The major questions here, who are these prospective clients and
where are they located?

I will select my prospective clients based on three major criteria: household income, age group and
education level.

Household Income in Montreal (Saint-Laurent) Household Income in Laval (Duvernay)

5
 Household Income in Brossard Age Group in Montreal (Saint-Laurent)

Age Group in Laval (Duvernay) Age Group in Brossard

Education Level in Montreal (Saint-Laurent) Education Level in Laval (Duvernay)

6
According to Census 2020, I have identified five top areas with huge potentials in regards with strong
purchasing power and undebatable interests in real estate investments. They are Montreal (Saint-
Laurent), Montreal (Pierrefonds-Roxboro), Montreal (Ville-Marie), South Shore (Brossard) and Laval
(Duvernay).

From Centris statics, I have pulled out sales, listing and overall volume ($) for these 5x potential areas for
the last 12 months period. See attached table 1.1.

We can clearly see 5341 sales done in last 12 months which generated over $2.9B in transaction records
in these 5x areas only. If my business goals over three years is to achieve 120K in Revenue, let us assume
2% as per transaction fee, I will need to record $6 million in transaction, which only represents 0.206% in
this market. It is an achievable goal for me if everything plans and executes well over three years span.

Table 1.1

In the same areas, the median pricing for single family house ranges from $495K to $1M. The median
pricing for condo ranges from $282K to $440K. See attached table 1.2. There are huge potentials for
people are looking for their first or next dream houses/condos with various pricing ranges, either
upscaling their spaces from condo to houses or downsizing from houses to condo. All comes to one
important point, I must master the essential needs of these clients, due diligence and find the best
match of their expectation in their desired neighborhood.

7
 Table 1.2

Market Planning

Marketing is the essential way to acquire customers, to be more specific, to generate as much leads
as possible via various efficient platforms.

According to NAR home buyer and seller generational trends report 2017,

 44% buyers looked online for properties for sale;

 17% buyers contacted a real estate agent;
 13% buyers looked online for information about home buying process;
 7% buyers contacted a bank or mortgage lender;
 6% buyers talked with a friend or relative about home buying process;
 6% buyers droved-by homes and neighborhoods.

To be more specific, as 44% buyers looked online, my first plan is to open all social media platform to
get full exposure, i.e., Facebook, Instagram and Pinterest, etc. It will take approximately 60 minutes per
days (ideally in the evening time) to answer and respond to all questions.

Nowadays, we must carefully select the information/hot topics to gain prospective customers’ interests.
By providing them useful tips or handful helps, I am expecting to gain their interests and trust a little by
a little. My second plan is to establish a solid knowledge-base website or blog to help and ease the
concerns of first home buyers. However, I must understand I am not professional of everything, I
cannot recommend or give advice outside my scope. All these out-of-scope questions, I must advise
them to look for professionals’ advice or services. The maintenance will be 30 minutes per day to
maintain and answer any questions.

8
In addition, if budget allows, I will choose some online tools or services to promote my social platforms
and my website. For example, SEO to promote my website and ads to generate more leads. For
example, chatbots and CRM system to regulate my calls and chats with potential clients.

Financial vise, I will put aside $5,000 for marketing special funding with projecting usages as follows:

 $800 for design consultant – social media platform and news lead design (to fit my profile) in the
next 3 months.
 $300 for web-site hosting – I have knowledge on making websites, so the cost is only for
maintenance. This will be completed in the first month.
 $500 for sale signage – this will be completed in the first month.
 $500 for business cards including design – this will be completed in the first month.
 $500 for CRM and other online tools that may help to follow up on conversations. – this will be
completed in the next 6 months (test and try)
 $2000 for SEO promotions – this will be completed in 6 months (target to increase leads by 50%)
 $400 for emergency funds

Operations plan

My operation plan needs to focus on how to get my services and listings in front of the right customers
at the right moment. Not just about to spend enormous time on repeating activities, i.e., updating your
website and responding messages from brokers and customers, but also very importantly, I must act
creatively to attract and bring in new clients.

Step #1: at the awareness level, I must use SEO engine to promote my listings and professional
branding.

Step #2: at the interest level, I must respond to client’s questions in time and capture their special
interests. A 1-day, 3-day and 7-day follow up must be completed with potential clients.

Step #3: at the conversion level, I must convert client’s special interest into products that match their
expectation (i.e., research of listings that match client’s interests and share with the client in timely
manner)

Step #4: at the qualification level, I must act proactively evaluate the financial situations of potential
clients and keep them aware of what are the maximum financial capacities they can move forward. Also,
I will provide suggestions to clients on value engineering to maximize the property’s potential value.

Step #5: at the closing level, I must verify all details and clarify all clauses to keep both seller and buyer
transparent. A 30-day, 60-day, 90-day and 180-day follow up must be completed in order to maintain
good relationship.

I must create my own check list to perform above necessary procedures. Trust builds up slowly with
care. Trust also be destroyed immediately with no care.

9
Financial Plan

Estimating income always be a huge concern for most new agents. I project 4x transactions for the year
#1, 8x transactions for the year #2 and 15x transactions for the year #3. Given the uprising market in
Montreal area, I am expecting the business grow will be exceptional. See the attached table 6.1.

Table 6.1

With careful managing the expenses and spending, I am act diligently to grow the customer base and
build trust relationship with them over a long period of time. I am expecting positive balance starting on
year #2 and year #3. Year #1 must deduct the start-up expenses of $11K. See the attached table 6.2.

Table 6.2

As a healthy circle of PDCA (Plan-Do-Check-Act), I must stay on track and reassess my real estate
business plan annually. The projected income is unstable, so I must tailor this plan with my various
growth stages to make it more realistic.

Identifying financial and business needs

A sound financial plan is essential to the business, especially for the start-up. Start-up expenses include
your broker training, OACIQ exam preparations, OACIQ exam, computer gears to support your business,
all other necessary signs and posts, website and other essentials for advertising. I must be well prepared
for the upfront costs. The cost is approximately $12,000.00. See the attached table 4.1.

10
 Table 4.1

After pass the OACIQ exam, I finally become a residential real estate broker and practice. I also prepare
the expected annual expenses for year #1, year #2 and year #3. See the attached table 4.2, 4.3 and 4.4.
Each year, expenses will go higher due to more activities and engagements in the business which is a
great sign of business growing.

11
 Table 4.2, 4.3 and 4.4

From above tables, I can see annual expenses increasing from $15K to $19K. I also plan to put aside $500
every year for emergency funds for any unexpected expenditures.

12
Summary
A new career is never a easy job. However, it will be my passion in the rest of my life. With a
detail strategic and tactic plan, a careful execution and a lot of sound advices from other
professionals, I strongly believe that it will be a fun ride and a successful career. And I am
exciting about it.

13