Topic: Closing ratio
Here's my answer -
I no longer give a $#!+ about your closing ratio
Of course this is just one opinion, but I've gone back and forth on this and measuring closing ratio is a joke imo. Good luck with this.
Of course this is just one opinion, but I've gone back and forth on this and measuring closing ratio is a joke imo. Good luck with this.
Posted 13 years 3 months ago
BJ, you didn't strike a nerve. That is the title of the blog post I wrote over a year ago. It's a link if you click on it and there are a number of good comments.
In general, we close about 25% of our traffic, but it varies by property. Some average as high as 35-40% and some are lower around 20%. I don't hold this against our teams nor do we use this as an indicator that they are doing well. Unfortunately it's a number that relies on leasing agents reporting ALL their traffic, and that doesn't happen if you hold them to some type of benchmark ratio. It's more important to me to have ALL traffic recorded in our systems so we can measure marketing.
How we measure our leasing teams is by the number of sales they have. I don't care if they burn through traffic as long as they are averaging 1 lease per week. We made it simple math.
- 300 unit property staffed with 3 leasing people.
- 52 weeks in a year
- Renew 50%
- 150 units remain to be leased
- If each leasing person averages 1 per week for the year you're good to go and should stay full.
No closing ratio necessary.
Sorry if I came across harsh. Just sharing my post. Thanks for joining the site and for your participation!
In general, we close about 25% of our traffic, but it varies by property. Some average as high as 35-40% and some are lower around 20%. I don't hold this against our teams nor do we use this as an indicator that they are doing well. Unfortunately it's a number that relies on leasing agents reporting ALL their traffic, and that doesn't happen if you hold them to some type of benchmark ratio. It's more important to me to have ALL traffic recorded in our systems so we can measure marketing.
How we measure our leasing teams is by the number of sales they have. I don't care if they burn through traffic as long as they are averaging 1 lease per week. We made it simple math.
- 300 unit property staffed with 3 leasing people.
- 52 weeks in a year
- Renew 50%
- 150 units remain to be leased
- If each leasing person averages 1 per week for the year you're good to go and should stay full.
No closing ratio necessary.
Sorry if I came across harsh. Just sharing my post. Thanks for joining the site and for your participation!
Posted 13 years 3 months ago
BJ, I completely agree and follow Marks theory. Why are we still doing business practices that were done back in 1994? I don't know if it's just me or Mark who also feel this way, but why do we put so much pressure and emphasis on sales people to worry about numbers & ratios when all we want them to do is make the connection and CLOSE in the first place!
True salespeople are motivated by the thrill and euphoria of making a connection with others and ultimately closing the deal. When the salesperson feels part of the process and success they are successful without your silly closing ratios, cost per lead, cost per lease, blah, blah, blah in my opinion. I train my sales teams to focus on making the connection, working hard at outreach and working their potential residents like friends. Letting the sales team show their personality & be themselves works every time in our offices. As long as I am reaching my weekly, monthly and ultimately yearly lease up goals within budget why is it so important to focus on closing ratios? It only adds more stress and pressure to an already challenging environment. Why not have faith, encourage, motivate and guide your teams to be salespeople and not policy followers. I mean they are salespeople right and not order takers? If I want order takers well then I'll just hire from McDonalds. I am sure others will feel differently about this topic, but I have to back Mark here and express we also follow this theory. Good Luck!
True salespeople are motivated by the thrill and euphoria of making a connection with others and ultimately closing the deal. When the salesperson feels part of the process and success they are successful without your silly closing ratios, cost per lead, cost per lease, blah, blah, blah in my opinion. I train my sales teams to focus on making the connection, working hard at outreach and working their potential residents like friends. Letting the sales team show their personality & be themselves works every time in our offices. As long as I am reaching my weekly, monthly and ultimately yearly lease up goals within budget why is it so important to focus on closing ratios? It only adds more stress and pressure to an already challenging environment. Why not have faith, encourage, motivate and guide your teams to be salespeople and not policy followers. I mean they are salespeople right and not order takers? If I want order takers well then I'll just hire from McDonalds. I am sure others will feel differently about this topic, but I have to back Mark here and express we also follow this theory. Good Luck!
Posted 13 years 3 months ago
Oh, some companies are still writing associates up for closing less than 30% - misses the whole point. Closing ratios are dynamic - goals to be set and adjusted often! If you have no availability, you close nothing, you can't stop the traffic from coming in....that's a good thing! Closing ratios are one piece of the whole marketing and sales puzzle. Macro goals, macro goals.... big picture....
Posted 13 years 3 months ago
Topic Author
I totally agree with everyones posts...Unfortunately there are still companies that deal with closing ratios, instead of how you are to the residents as well as incoming traffic..I've been on interviews where that was one of the first questions asked...I feel that people in this industry can make more of a contribution and can succeed more if there is not this added pressure...A prospect can sense desperation in a person and it does not make for a desirable tour!! :)
Posted 13 years 3 months ago
BJ,
I hope that maybe after this discussion you may have a different perspective (even in an interview). How cool would it be if you presented the idea of closing ratios having too many variables, and that having leasing people focus on those doesn't really help achieve the final goal of actually getting to a sales goal. I'd let people know and a leasing team know what their sales goal is and have them strive to hit that. The ratio is essentially irrelevant as long as you're hitting your sales numbers.
We put this measurement practice into place about 2 years ago, and we went from having only 50% of our leasing people averaging 1 lease per week to nearly 75% achieving that goal this past year. It's just a better metric to focus on as it calculates real results. We publish a spreadsheet every Monday morning that shows where everyone in the company stands with average leases per week. Everyone knows exactly where they stand vs. their peers. We also reward people quarterly for maintaining their average about 1, and award our "leasers of the week" that have the most sales for the week. It's easier for everyone to monitor and strive for because its straight forward and simple. These are "net" leases we measure as well. Cancels and rejects don't count.
What we found when we measured closing ratios is that we would address low closing with people, do training on closing techniques, and then see that our traffic numbers would go down but the ratios would go up. So we basically didn't achieve anything other than testing people's integrity. In summary, if you want to see good closing ratios all you have to do is ask for them. People will record only their good traffic and achieve their closing goals every month. What they won't achieve is the actual leasing goal they need to hit to keep the property full.
OK, I'm had enough. I get more pumped up about this than cost per lead or cost per lease. That argument drives me nuts, but don't miss it today on #aptchat if you have a passion for that.
I hope that maybe after this discussion you may have a different perspective (even in an interview). How cool would it be if you presented the idea of closing ratios having too many variables, and that having leasing people focus on those doesn't really help achieve the final goal of actually getting to a sales goal. I'd let people know and a leasing team know what their sales goal is and have them strive to hit that. The ratio is essentially irrelevant as long as you're hitting your sales numbers.
We put this measurement practice into place about 2 years ago, and we went from having only 50% of our leasing people averaging 1 lease per week to nearly 75% achieving that goal this past year. It's just a better metric to focus on as it calculates real results. We publish a spreadsheet every Monday morning that shows where everyone in the company stands with average leases per week. Everyone knows exactly where they stand vs. their peers. We also reward people quarterly for maintaining their average about 1, and award our "leasers of the week" that have the most sales for the week. It's easier for everyone to monitor and strive for because its straight forward and simple. These are "net" leases we measure as well. Cancels and rejects don't count.
What we found when we measured closing ratios is that we would address low closing with people, do training on closing techniques, and then see that our traffic numbers would go down but the ratios would go up. So we basically didn't achieve anything other than testing people's integrity. In summary, if you want to see good closing ratios all you have to do is ask for them. People will record only their good traffic and achieve their closing goals every month. What they won't achieve is the actual leasing goal they need to hit to keep the property full.
OK, I'm had enough. I get more pumped up about this than cost per lead or cost per lease. That argument drives me nuts, but don't miss it today on #aptchat if you have a passion for that.
Posted 13 years 3 months ago
I am going to throw in my agreement with Kim, Mark, and Steve... While measuring closing ratio is a dated, daunting, and completely skewed measureable, it is still done. Which is ridiculous. Doesn't take into consideration ANY of the marketing skills that we teach our leasing professionals, nor does it account for unqualified applicants, etc.
I preach and pride my staff on their connection, follow-up and ability to fill seats. I personally am a big believer in waiting for the right resident (i.e. qualified, interested, invested in my product, and connected to my leasing professional) rather than trying to forcefeed those same traits onto anyone who walks through the door.
I preach and pride my staff on their connection, follow-up and ability to fill seats. I personally am a big believer in waiting for the right resident (i.e. qualified, interested, invested in my product, and connected to my leasing professional) rather than trying to forcefeed those same traits onto anyone who walks through the door.
Posted 13 years 3 months ago
