After completing a 2014 P&L this is what became apparent:
1,000 BPOs completed
$30,0000 expenses to complete BPOs including a part time assistant.
That means, just to be in business to complete BPOs we need to budget $30 per BPO.
Therefore at $50 per BPO, on average -
we net $20 per BPO before social security taxes and health insurance.
Anyone who completes BPOs for $35 or $40 cannot possibly be making a profit.
Comments
perhaps your are right but I dont use an assistant and I gather my photos on the way to and from getting my kid from school sorta across town. that is a fixed cost for me so I do make out all right. Plus does anyone else keep their photos of homes on a spare thumb drive? I have appraised the same houses sometime three times! alphabetize your bpo's and save gas when you can.
Why would you pay an assistant $30,000 a year, there is software that I use, BPO Assistant, www.trackmyforeclosures.com, that only costs me $50 a month and it fills in the data in less then 30 seconds. For those of you that use people in India, you are waiting to get caught by the BPO Company, it is a STRICT violation to use someone else to perform your BPOs. Why would you outsource it when software does all of the hard work.
if you have not looked into the software you should, like I said it is $50 a month and I have been using it for 6 years and LOVE it. Back in the day when I signed up they had a 30 day money back guarantee, I don't know if they still offer it but trust me you wont even ask for your money back. Its like a DRUG it is super addicting, I do over 200 BPO's a month in the Chicago il area and couldn't live without it.
Amy
This entire post has reminded me of something that someone told me when I first entered real estate in January 2007. That's when I began completing BPO's as a source of income until I was able to actually find regular clients. I was working in the bullpen of my office when an agent asked if I was doing BPO's. When I replied, "yes", she hastily stated that she'd NEVER do them because they were a waste of time. When she left, another agent approached me and told me that most real estate agents were never going to explore those parameters that lie outside of their comfort zone. He told me that my willingness to do so would be the foundation of my business and would keep me in business during the pending real estate doom that were heading towards. As it turns out, he was right! My BPO business paved the way for my REO business....In a nutshell, I ended up selling REO properties and the other agent who turned her nose up at what I was doing quit the business less than 2 years later.
I continue to ask more for BPO's and so far so good. Each is done by myself as directed by the companies I work for. If someone can do them for less, more power o them! They can have the business they take away from me :) I'll go find something else to do. I too think bottom feeder is a harsh word but not as harsh as working for less than minimum wage, especially when considering there is always potential liability and danger involved. To each his own but my goal is to keep doing BPO's but for better wages.
I totally agree. Unfortunately the trend is for the paying less for bpos. Many that were at $50 are now offering $40. The reason for this I believe is the "services" There are some that use all kinds of auto capture and form fill. They are able to get BPOs "assigned direct from capture services with inhouse connections, especially those in India. There is 1 capture service and a form fill service located in India near where one company out sources general duties to and I think most know them bpo provider. Well for $12 you can literally get bpos and then have then bpo completed, less subject pictures, in total. You can get picture services to shoot a property for $10 and under. So on a $40 bpo pay you will make $18 for posting 3 pictures and do an easy 100 a day. The the BPO providers want us to buy individual background checks!!!! This business is as corrupt as the early stages of 2006. And no one really cares about quality. Just move the bpo and we'll cover our eyes.
I agree with Vanessa. This repeated "bottom feeder" name calling is ridiculous. It does, however, say a lot about the persons who post such things.
Laura, I agree with your numbers. It is about where we are at present. I have an assistant that does the data input after I take the pictures and pull the comparables. When she is done, I go back to tweak and value. She makes $12.00 an hour and works 40 hours a week. That is just under $500.00 per week. She also does other things beside data input but about 75% of her job is BPO related. In the past, I have tried to do it all myself but my numbers dropped and it made more sense from an aspect of what my time was worth that I put someone back in the office to help out. Of course, the area a Broker is covering also has something to do with it. We are in upper Middle Tennessee and lots of rural and sprawling suburban properties. We just can't accept a $30 BPO or we end up paying to do it or break even. Sometimes we can get 2 or 3 in the same neighborhood but generally, that is not the case in this area. But even in an urban area, I don't see how a $30 BPO can excite anyone. Your time is worth much, much more. Half of that $30 has to be cost (including your time) unless the property is next door. So if you feel you are worth $15 an hour, have at it.
Yes, Patti...my BPO work pays my son's college tuition which is right around $20k per year. It's a regular 4 year college. It isn't Syracuse, but it does provide him with a really good education (I'm pretty sure that you didn't mean to appear to be rather catty). I complete BPO's for institutional investors and am paid pretty nicely for my good work. I also complete my own BPO's for my REO listings as well. In addition, I sell real estate....so things are going PRETTY well on my end.
putting a kid thru college doing BPO's, what kind of college is it. Tuition here at Syracuse University is 75K a year, that is a hell of a lot of BPO's. I will not do any for less that 55.00 and some at 125 to 150 and I do hundreds of them. It all boils down to, You know what your service is worth....
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