March, 2018
Inspection News and Views from the American Society of Home Inspectors

Setting Sales Goals


Author’s note: The numbers we suggest in this article are simply examples that can help you define your sales goals and set up a business plan. Actual figures and market conditions in your area may vary significantly from the examples outlined here. It is important to research and understand your area of business in order to set realistic financial goals.

Goal setting is vital to succeeding in sales. Because rejection is part of the process (see the Carson Dunlop article “Interpersonal Skills: Handling Rejection,” in the January 2018 issue of the Reporter), you need to define your goals in order to turn the process into a positive experience.

What are some realistic goals? Let’s look at the math.

Be reasonable about what your business will look like when you succeed and then aim for it. Realistically, you can only inspect a maximum of three houses per day without sacrificing your service level and professionalism. In a 20-day month, that’s 60 inspections. If your fee is $400 per inspection, you’ll earn $24,000 per month or $288,000 per year.

That sounds great, of course, but it is not a realistic number. Most inspectors do not average three inspections per day. A more realistic average number is 2.0 to 2.5 inspections per day. Let’s adjust our example to two inspections per day or 40 inspections per month (based on a 20-day month). An inspector who does 480 inspections per year is very successful, with a gross annual income of $192,000 (480 inspections x $400 per inspection). 

Now consider how much business you can solicit from real estate agents. If you solicit agents at random, the numbers can look dismal. On average, agents sell only two homes per year. This means you would need 250 “average” agents referring business to you to get 500 inspections in a year. If you factor in a success rate of one in 20, you would need to solicit 5,000 agents. (This success ratio is arbitrary—we chose to use a low success rate to show you a worst-case scenario. If you are a good salesperson, your success rate will be higher.) 

Playing out this example a little further, to build your business to full capacity in one year would mean making almost 20 contacts per day and meeting with five to 10 agents! Not only is this unrealistic, it raises another question: When are you going to find the time to do any inspections?

The solution is to solicit only top agents and to maximize your success rate by using solid sales techniques. Consider how many inspections you can get from a top real estate agent. The top agent for our company refers more than 100 inspections per year to us. Many agents refer five to 10 inspections per year to us. A reasonable number of inspections to expect from a top agent might be 20 inspections in a year.

What does the math look like now? You need 25 top agents referring business to you. With a success rate of one in 20, you would have to solicit 500 agents. To build your business to full capacity in one year, you would have to make 1.9 contacts per day and meet with two or three agents per week.

These numbers look a bit more reasonable. And don’t forget that this model would grow your business to full capacity in one year. Achieving full capacity in two years would be better than average.

If you are doing your job well, you will get referrals from satisfied clients. Also, your marketing, advertising and public relations campaigns will generate prospects that will turn into satisfied clients. Our advice is to keep setting and reaching for your goals!

Carson Dunlop - Consulting engineering firm devoted to home inspection since 1978.