SWOT Like a Pro

Most real estate advisors wish they had a crystal ball that would allow us to see what’s coming in the future so that we can better prepare for it. The SWOT analysis can help improve and prepare you for the future. 

While a SWOT analysis can’t tell us what the future holds, it can help you put together information and to leverage your market knowledge and professional instincts to make some educated guesses about both short-term and long-term movements in your business. 

SWOT analysis was first introduced in the 1960s by Albert S. Humphrey as a tool for business planning at the Stanford Research Institute. If you’ve ever taken a basic business course, you know SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. But if you just write down a couple surface level answers for each category, are you really NOT learning anything about yourself or your business? Let me walk you through a fool proof system to SWOT like a pro.

Done right, it can help you to make good decisions, strategic planning and even reframe negative narratives for future success. 

Breaking it down

SWOT stands for Strengths, Weaknesses, Opportunities, and Threats.

SW: Strengths and weaknesses are internal—things that you have some control over and can change. Think of your resources, capabilities and performance; maybe review feedback you may have received from past clients, other agents or your broker. Strengths are positive qualities that give you a competitive advantage, while weaknesses are areas that need improvement. Examples include who is on your team, your intellectual property, your knowledge, your niche, etc.

OT: Opportunities and threats are external—things that are going on outside your business, in the larger market. You can take advantage of opportunities and protect against threats, but you can’t change them. Consider external factors such as market trends, competition, economic conditions, and technological advancements.

A SWOT analysis is organized in a simple two-by-two grid. The observations you make will help you build a stronger business plan and help you cut through all the noise. 

The ultimate goal in completing a SWOT is to turn your weaknesses into strengths, and threats into opportunities. Let’s get started!

Strengths 

Your strengths are your internal positives that you have total control of.  Some strengths of a real estate agent may include excellent communication skills, strong negotiation abilities, knowledge of the local housing market, attention to detail, and the ability to handle complex paperwork and legal documents. Additionally, a successful real estate agent may possess high levels of professionalism, integrity, and a strong work ethic. Use the following questions to start critically thinking and come up with a comprehensive list of what your current strengths are:

• What are your strongest assets?

• What do you do better than anyone else?

• Where are your resources strong?

• What is your expertise, certifications, etc?

• What is the positive market perception about you and/or your business?

• What advantages do you have over your competitors?

• What are your unique value propositions?

• What are your strongest values?

• What are you extremely passionate about?

• How is your business different from your competitors?

• What unique resources do you have access to?

• Do you have a sustainable competitive advantage?

• What is your unique selling proposition?

• Does your business have any exclusive relationships with suppliers or distributors?

• Where do your sales and marketing efforts excel?

• What skills do you have that our competitors don’t have?

• Do you have a strong customer base with a specific demographic?

• Are there skills you have that you could do in your sleep?

• What things do your customers say you do really well?

• What market knowledge do you have that many others do not?

• What strengths does your Sphere of Influence have?

• What industry expertise do you have?

• What connections do you have in your Community?

• What positive online reviews and testimonials have you received?

• What is your industry reputation or leadership positions?

• What is your positive brand identity and local reputation?

• Any other areas or thoughts of your strengths?

Weaknesses

Your weaknesses are your internal negatives that you have total control of.  These things may hinder your ability to achieve your goals or compete effectively in the market. It might include things like a lack of communication skills, poor time management, lack of knowledge about the market or properties, and difficulty adapting to changes in the industry. Maybe you struggle to find motivation. Whatever yours may be, we all have them. Let’s use the following list to identify as much as we can, and further down, I’ll teach you how to turn weakness into strength:

• What needs improved in your business?

• What do your competitors see as your weakness?

• Where do you lack resources?

• What skill sets are you missing?

• What should you avoid doing?

• In what areas do you need to improve?

• What expertise do you lack?

• In what areas are your competitors better than you are?

• Is there one customer demographic carrying your entire business?

• What complaints do you regularly hear from your customers?

• What objections do you most often hear from potential customers?

• When do you typically feel the most stressed?

• What skills do you lack?

• What bad habits do you have?

• What area do you lack experience in?

• Are you new to the market?

• Do you have a small sphere of influence?

• Do you have negative online reviews?

• Any other negatives you can think of?

Opportunities

Opportunities in the context of a SWOT analysis are external positives, things you can leverage but are not in your control. This could be something like growing demand for housing in a particular area or demographic, new technology or tools offered by your brokerage, or changes in government policies or regulations that benefit the real estate market.

Some questions to get you started:

• What opportunities are open to you?

• What market trends can you take advantage of?

• What is the market missing?

• What possibilities exist?

• How do you turn your Strengths into Opportunities?

• What market trends could positively affect our industry?

• Is there talent available that you could hire?

• Is there a need in the industry that you’re not meeting, but could?

• Do your competitors have any weaknesses that you could take advantage of?

• Is our target market changing in a way that could help you?

• Is there a niche market that you’re not currently targeting?

• Do your customers ever ask for something that you don’t offer, but could offer?

• What growth could be captured due to new businesses coming to Kansas City?

• What growth could be captured through new developments?

• What growth could be captured through investments?

• What new housing trends will be opening up?

• Any other opportunities that you can think of?

Threats

Threats are external negatives - things you must be prepared for that are not in your control.  Some questions to get you started:

• What external situations can harm your business?

• What are your competitors doing really well?

• Any negative aspects of your local market?

• Political, regulatory, economic impacts on the horizon?

• What threats might be exposing you to negativity?

• Are your customers happy and supported, or could they easily be poached?

• Is our website secure, or do you run the risk of being hacked?

• Is your target demographics shrinking?

• Are interest rates possibly going to cause market constraints?

• Are there any supply shortages that could affect closings?

• Economic downturn predicted?

• Rising interest rates or cost of housing?

• What industry shifts might be coming?

• What market shifts are happening?

• What inventory shortages might be happening?

• Any other external negatives that will be affecting your business?

Map a Plan of Action

Once your SWOT chart is completely filled out and you’ve brainstormed these four individual sections thoroughly. Use the information you've gathered to develop strategies to capitalize on strengths and opportunities, while mitigating weaknesses and threats through the following steps:

1. Matching up internal strengths with external opportunities to create strategies that maximize current advantages.

2. Using internal weaknesses and external threats to identify areas needing improvement, developing strategies to mitigate or address them as needed.

3. Prioritize these strategies based on their potential impact on your business and feasibility.

4. Clearly defining your best objectives and course of action for future goals.

5. Developing a detailed plan of action with clear steps and timelines for each objection.

6. Assigning any responsibilities and roles to possible team members or associates.

7. Establish how you will measure your progress moving forward.

8. Establishing key performance indicators (or kpi’s) to alert you of possible issues as-well-as confirmation you are on the right track.

9. Regularly review and update your SWOT analysis to stay informed and adapt to changes in your environment.

10. Be sure to celebrate successes and learn from your failures to improve future strategies.

Success does not happen without failures, but through planning, measuring and tracking we ensure our failures do not out number our successes!