aenspire delivering developmentprofit.com

Lets talk about Bonuses. The last time I was a full time employee I spent an inordinate amount of time on developing a performance & incentive scoring, ranking and bonus scheme for the entire company (80 ish staff). My board threw me some google (or some tech giant) book on KPI’s (Key Performance Indicators) to kick it off.

Take out 9 sales consultants who basically are all bonus and I had to develop a bonus structure and system for 70 odd people, about 40 different positions* Well to be fair I had some ‘guidance’ from the Peoples Republic, probably a team of them up there. But I had to do a tonne of research of all the systems in use around the world by various companies so I could rebuild what was presented to me to make it workable in NZ for New Zealanders in our vertically integrated property development design construction and sales business. And I had previously rewritten everyone’s job descriptions as part of a massive restructure process to help me out on that.

Anyway, it took ages, it was comprehensive. With this knowledge it now means I am somewhat an expert in developing custom performance and bonus structures. I have even subsequently developed a templated software easy enough for SME to use it. But I customise extensively depending on the nature of the companies requirements, their organisational structure and staff roles. And I understand many of the issues that come up with setting bonus and KPI’s and the performance or not that results.

So if you are considering a performance and bonus structure for your organisation – give me a call. 021982444

And remember this golden rule:   If you promise a bonus and the employee succeeds in the KPI’s you set AND you don’t pay the bonus on time or worse you don’t pay it at all, you don’t deserve to be in business.

There is an onus on you to pay the bonus!

Key Performance Indicators: At Xpect we have built a KPI engine, an elegant and robust Key Performance Indicator framework that you can use with your staff to incentivise performance, increase new business and have everyone focused on the prize(s) that matter for your companies success.

Price on application.

And we recently built a specialist bespoke KPI for a local builder/developer in NZ:

“Andrew, the KPI tool you have put together for me is fantastic. I must say, it has dramatically transformed the way we manage and track our key performance indicators. From the moment I started using the platform, I was impressed by its user-friendly interface, which makes it easy for both beginners and seasoned professionals to navigate effortlessly.
One of the standout features is its customizability. You were able to tailor the dashboard to fit our specific business needs, allowing us to monitor the KPIs that matter most to our team. The visual representation of data is intuitive and effective; the chart presents information clearly and enable us to quickly identify trends and areas that require attention.
You deserve a special mention for your responsiveness and expertise. Whenever I encountered a question or needed assistance, you were quick to provide thorough and helpful answers.
In summary, the KPI Indicators is an exceptional tool for any organization looking to sharpen their focus on performance metrics. It enhances visibility into key data points and facilitates informed decision-making, ultimately driving our business forward. I highly recommend it to anyone seeking a robust KPI management solution. “

Steve Palmer
Managing Director
Hi-Tec Property and Developments Limited

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*The list of positions.
CEO
CFO
Investment Director
Development Director
Compliance Director
Operations Manger
Construction Manager
Senior Project Manager
Project Manager
Site Manager
Fence & Truck Guy
Maintenance PM
Maintenance Admin
CCC Manager
Head QS/Commercial Manager
Senior QS
Intermediate QS
Junior QS
Head of Sales/Marketing
Marketing Assistant
Health & Safety Manager
Development Manager
Junior Dev Mgr
Acquisitions Manager
Senior Architectural Designer
Architectural Designer
Junior Designer
Consents Administrator
Information Systems Manager
Sales Admin
Receptionist
Company Accountant
Assistant Accountant
Customer Service Manager
Payroll Administrator
Civil Project Manager
Cost & Compliance Manager
A few others I can’t recall the Titles….

Andrew Crosby
+6421982444
andrew@xpectproperty.com

[This section could do with an update due to the rise of influencer marketing and PR and trying to go viral, although I am not sure too many real estate developments really have been successful like some consumer brands have been.]

Receiving positive publicity for your development can trump all advertising combined. I have seen one newspaper article dramatically transform a development that wasn’t selling to almost sold-out in three weeks. For large developments you might employ a public relations agency to run a publicity campaign.

Getting the right type of publicity is not always that easy. Using social media runs a fine line between blatant advertising and trying to drum up positive public relations (PR). Once you start, the publicity route can be tricky to navigate. If your development strikes issues (and they often do) PR can work against you and amplify controversy.

Therefore, if sales are already going well consider not engaging in overt publicity.

Nonetheless, here are some ideas to help generate positive publicity with the ultimate aim to sell faster, for higher prices and increase your profit:

• Pitch for editorials and news items. How does your development become an editorial? Pitch stories with a unique angle to the local newspapers and magazines. For example, promote a personal interest angle (such as a couple buying one of your homes), an exposé about you the developer, or a piece about the architect indirectly referencing your project (because of all its high technology features or because your development is part of a larger location gentrification story). All you have to do is try to get a story written about your project that convinces buyers you are offering great value with a fantastic product in a superb location and everything is going extremely well! You may just find that a deadline is looming and the editor or journalist can use your story to fill the page.
• Associate with other businesses, charities or products (such as the development site being used as the background to launch a luxury car model, or the display suite for a fashion show). Indirectly attach your project to the publicity they generate.
• Stage events inviting prominent locals. Inviting the local mayor, politician or celebrity to your development opening will increase media exposure.
• Create community functions that attract local interest stories (such as farmers’ markets, night markets or sports tournaments).

Andrew Crosby
+64 21 982 444
andrew@xpectproperty.com

[NOTE: This section of the book can do with an update, given the dramatic changes in social media, search and AI over the last few years.]

When you ask most agents for their marketing strategy they send you an advertising budget. Advertising is not marketing. Advertising helps you spread your message whereas marketing is about creating and massaging the message. Of course, the two are inextricably linked — your marketing strategy helps determine what advertising you will use and the form of advertising available in the market influences how you present your message. Advertising mediums include:

• Direct selling — agent or developer targeting existing contacts, or simple old canvassing and cold calling.
• Internet — agent website, market wide multiple listing websites, online adverts, social media.
• Specialist real estate magazines.
• Signage — bus-backs, bus shelters, billboards, on-site advertising boards.
• Newspaper real estate sections — national, regional, local, ethnic.
• Target market publications — flight magazines, community publications, foreign magazines, home design magazines, financial and investment publications.
• Advertorials in publications and newspapers.
• Flyers and postcards — distributed around the neighbourhood, mailbox drops, placed in retail shops.
• Radio advertising.
• Television — mainstream channels, cable, community or ethnic channels, on-demand internet TV
• Sponsorship — local sports teams, charities, radio or television programmes partnerships.

Advertising needs to be budgeted for accordingly. Have your agent provide a breakdown of all proposed advertising mediums and their cost over a one, two or three month sales programme. Challenge the agent on each medium asking them to present the evidence to justify you paying for this advertising. Listing your project and individual sections or homes on multiple listing websites is very cost effective and let’s face it — everyone who wants to buy a home is looking at web listings every day, throughout the day. Therefore, do you even need a newspaper or print publication advertisement?

Maybe, as it can help reinforce your project in light of the competition and great advertising can be lost on the internet as compared to in print. In addition, when you list on the internet you have to define specific categories about your homes or sections and therefore you are relying on the buyer’s search criteria finding your project. If yours are the only sections being sold in your area, potential buyers who have not considered buying a section versus buying a home and land package may not even know your option exists.

Establish a way to measure how effective your advertising is. Ideally you will determine your cost per sale for each form of advertising. With real estate advertising typically utilising multiple channels (and many building on and reinforcing others) this will be near impossible to calculate.  However, make your best effort to record the data and measure over time. When the agent holds open homes or gets contacted by a potential buyer get them to ask and record ‘how did you find out about us?’ A second more powerful question is ‘what made you contact me today?’  Try to determine what advertising is best at attracting buyers and what advertising has little effect.

When placing print adverts the location and prominence on the page is important and the publication will price accordingly. Expect to pay more for a right hand side page than a left hand. A full page costs more than a half page which costs more than a quarter page (but not necessarily proportionally). The cover is prime advertising real estate, often accompanied by the inside cover and first page for a three page spread. The rear page is also sought after. A typical approach is to launch your development with prime adverts and continue with full page adverts in the first month. Then, if sales are progressing according to expectations rely on smaller adverts. Expect to do more advertising in a softer market.

Agents like to profile themselves as much as possible and love having their photo attached to all advertising — it helps them get facetime in their market and win their next listing. This is not necessarily a bad thing for your development but you must be careful to balance the development branding so it does not unduly compete with the branding of the real estate agent or their agency.

Whichever medium you use you need to employ your price setting strategy to advertise your price. Price positioning can include several techniques to draw buyers, for example:

• Prices start from $500,000
• From $500,000 to $750,000
• 4 Bedrooms $600,000, 5 bedrooms $750,000
• One left at $499,000
• First release pricing $399,500
• All priced below $599,000!

You may decide not to present a price and use by negotiation, tender or auction. However, you definitely want to instil a call to action. One way is to advertise how successful the development is and how many units you have sold. Overtime, buyers who look at the same advert each week see available stock decreasing — this can act powerfully to create a sense of urgency. Advertising ‘call to action’ examples:

• 30% sold out!
• 30% sold out first weekend!
• Only seven left!
• 15 sold, 3 remaining!
• Averaging 10 sales per week, only two weeks inventory left!
• All four bedrooms sold out — only five bedrooms remaining[1]  

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[1] Be careful this doesn’t create a negative reaction in a buyer — why does no one want the five bedrooms?

Andrew Crosby
+64 21 982 444
andrew@xpectproperty.com

Where the agent is going to be doing the selling influences what marketing collateral you will use. This will be the place where you present the marketing that describes your development. Here are four options of increasing expense:

1. Sell from your real estate agent’s office. Have them dedicate wall space, a corner or even a separate room to market your development.
2. Sell onsite in a temporary building or within an existing onsite building.
3. Build a semi-permanent custom sales suite and display either onsite or in space nearby.
4. Build the first house in your development as the show home.

The larger and more luxurious your development the further down this list you will likely need to go. Once you have construction underway you could fast-track one home to act as the sales suite for the other homes in the development. For options 2 and 3 you can include building a mock-up of key features to give buyers a preview of what they will be purchasing, for example, a kitchen or bathroom complete with flooring, joinery, fittings, fixtures and appliances. If you do build in examples of what purchasers will be receiving then you need to decide whether you show the base specification or upgrades and optional extras. If the latter, then the agent will need to carefully sell potential buyers on what is the base and what is an upgrade.

Plan the layout of your display suite to enhance the sales process. Involve your agent in the layout. The entire sales suite should be designed to close sales. Help the agent tell the project story in a logical flow like a fully immersed live brochure. Here is an example of the agent interacting with a potential buyer in a well-designed display suite:

• Provide a comfortable entry setting to enable the agent to build rapport with buyers and uncover their needs and priorities. This may be an inviting reception room where there is plenty of space and maybe some couches for people waiting. 
• The agent then takes the buyer into the display firstly describing the background of the project, the developer’s vision and the greater location — selling the big picture aided with printed and interactive displays.
• To reinforce quality and deliverability the display may present a brief synopsis of past projects and experience of the developer, builder, architect and urban designer.
• The display progresses to outline the site plan and amenity of the development — perhaps a spectacular model — to illustrate all the benefits why one should buy in this subdivision.
• Then the presentation can focus on the individual sections and the features and benefits of each. This may be on the model, through large rendered site plans, or computer animations where you can zoom into individual sections and view the topography and building platforms.
• Floor plans, renders and computer generated animations allow the agent to present the types (size and design) of homes available (or suitable for, if selling sections). Attention is limited to high level key benefits at this point (such as two living areas so the kids can play without disturbing the adults and a great deck for outdoor summer dining).
• Before delving into too much floor plan detail the sales suite evolves into a mock-up of the kitchen, living and bathroom. This is where buyers can touch and feel the product and imagine themselves (or their tenants) living there.
• Material palettes, colour options and any upgrade options are displayed so the buyer starts to personalise (in their mind) their potential purchase.
• The agent then goes from a presentation mode to an initial closing mode. They show how many sections and homes have sold (like red dots on a wall-hung site plan) demonstrating the call for the buyer to take action.  From there, with the hook well and truly snared, the agent sits the buyer down at a sales desk, sales office, or just on a couch to talk through specific floor plan options, section details, pricing and the formalities of signing the agreement.

Even if a buyer is not accompanied by an agent, they should experience the development within the display suite as if they are being told an enticing story. The ending of course is with them signing a contract!

Andrew Crosby
+64 21 982 444
andrew@xpectproperty.com

Site and Floor Plans

Site plans and floor plans should be of a reasonable size (especially if they are small in the brochure) and should be printed on good quality stock for handing out and discussing with potential purchasers. Consider 3D house floor plans, although done poorly they can make rooms look crowded and the layout difficult to read.

Website

The easiest way to get a cost effective website up and running is to book the designer in and provide them with your draft brochure and tell them to ‘web it’. Websites have actually decreased in complexity over the years, primarily to allow for viewing on phones and tablets. You may even consider just making a social media page as the website (Facebook.com if it still exists by the time you are reading this). When the brochure is 100% then you can get the web designer to drop in the final images or text. To avoid rework don’t have the web designer undertake any graphic design themselves on the images to drop in (like plans and renderings). Make sure the website is fast on both computer and phone and easily navigable. The website’s overall quality should match the level of quality and luxury in the development you are creating.

Colour Boards

Colour boards that show the key finishing materials and colour palette options for the houses you are selling can be put together by your architect, interior designer or just do it yourself. Don’t provide too much choice as it gets difficult to manage the different options chosen between purchasers.  Consider limiting it to two or three colour schemes with no mixing and matching or substitutes allowed. Anything else is to be priced as an upgrade. Examples for the base that the materials will be glued or taped to you include a large tile, wood board, foam board or plastic/polymer sheet. On each base board material include the ten or so core interior materials:

• Wall paint
• Ceiling paint
• Feature wall paint (if any)
• Carpet
• Kitchen and entry tiles
• Bathroom tiles
• Kitchen benchtop
• Kitchen splashback
• Kitchen joinery
• Bathroom vanity top
• Bathroom vanity joinery

You could also include a kitchen cabinetry handle to highlight the materials.

Upgrades

If you are offering upgrades then you will need product information or material samples available as well.

Marketing Collateral Plus

Beyond the minimum described above there is plenty more marketing collateral you can present (and pay for). Consider the following if you and your agent determine it will help sales and make your project more profitable:

• A slideshow of artist’s impressions and floor plans.
• A computer animated rendered fly thru of the development.
• Drone flyover of the existing site, highlighting location amenity and views.
• A professionally made movie, starting with actual location and amenity scenes and zooming in and through a 3D fly thru of the development and then individual house types.
• Computer rendered interactive rooms where you can move throughout the home, linked to virtual reality headsets.
• Touch screens linked to website, or a custom application providing a menu for the buyer to select from to learn about the design and features of the development.
• A physical model of the development’s greater location.
• A physical model of the development site, with lights to highlight individual sections.
• Physical models of house types, with a removable roof or cutaway section to display internal layout.

Andrew Crosby
+64 21 982 444
andrew@xpectproperty.com