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
Your expenses are out of control, I do that much no assistant and travel out of my local area (for a much much higher fee).
Why do you need someone to answer your phone??? I handle all my own business PLUS making a good salary selling real estate all by myself and I am 70+ years old
there are always bottom feeders out there who work for peanuts. It is cash flow to them as they have no idea how to be successful
We live in a rural area and don't have the luxury of working a small radius and certainly can't afford an assistant. Grossed about 15K in 2014 the highest ever was $24K. Been passing up a lot of orders lately holding out for better pay, working for companies that don't have overly difficult sites or overly difficult qc. At best BPO's serve to fill in the gap when the regular business is weak. Definitely low paying and probably better off just collecting welfare but I'd rather work for a living so we'll just keep doing them and trying our best to get decent pay for the work.
I agree, Laura. This is why I will only accept orders within a certain radius and I will only complete them for one company. I will have 10-15 orders within one area..knock out the photos in one day and then work on reports. It takes me roughly two days to get everything completed and in to my client. I've used about a half a tank of gas, no more of the data required for my regular data plan that I already have on my phone. My expenses are no where near $30,000...however, I'm pretty sure our businesses are structured differently...as is the case with all businesses.
If we are honest with ourselves and add up our real expenses, we may be surprised at how much we front each year just to be able to be in a position to complete the BPOs.
I would probably re-think the assistant. At my busiest, I was handling 40-60 per week along with my regular REO real estate duties...Now, I'm averaging around 20-30 per week without an assistant. I use Realty Pilot, which makes a huge difference.
When we belong to any MLS site then we must to belong to at least one board, national and state associations, and if we cross state lines we can double this expense. We are required to carry E & O insurance and business car insurance coverage. We need smart phones to take photos and transfer data. There is wear and tear on our automobiles we need to buy new tires, change the oil and purchase gasoline. We need an large band width internet connection to upload photos to the BPOs. At 20 orders each week we need an assistant to answer phone calls from asset managers, re submit and accept new orders.
$30K in expenses? That's so high. I do that kind of volume and have no where near that expense. I do not use an assistant.
How do you get that number? Do you do the same calculations for your listing activities?
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