The Wholesalers Deal Machine
Just wanted to drop a quick note on how the business of a wholesaler works. There is one key word here...VOLUME...
The reason I decided to write this is because I just got off the phone with a seller on a deal that I am working on in a virtual market. Drop me a comment if you want to know more about what Virtual Investing is.
The short story is that I have a buyer who is ready to go at 45K. I offered the seller 30K because it is in need of some serious work. I just got off the phone with him and he said he would take 35K. Do I do the deal? There is another factor here though. I have 2 other partners on this one. One partner is somebody that I have teamed up with on some marketing costs and the other partner is the investor that is bringing in the buyer.
So basically 10K split 3 ways is 3300.oo or so. I thought to myself "Should I go back to the seller and hit him for 32K or go back to the investor that is bringing the buyer to take less of the deal?"
The answer is that I should just take the deal and take my 3300 so that I can build my relationships with the investor who brought the buyer so I continue to do future business. One thing that is very important in this business is to build relationships! They will keep you in business.
So anyway that deal for 3300 with another deal for 10K and another deal for 10K is what 23,300? This is the wholesaler's deal machine. The little deals keep you in business to get to the bigger checks. You know I have not had a 20,000 deal in a while and it starting to get on my nerves. I will keep you posted though :)
Keep on Keepin On
Comments (8)
Agreed there is nothing wrong with making big money on a wholesale deal. But there is nothing wrong with only making 1K. Walmart sells some big ticket items but they also sell $1 candy bars.
Ned Carey, about 11 years ago
Hey Trace I am located in the Hampton roads area of Virginia. I am sure we will be working together in the future!
Alex Joungblood, over 14 years ago
Agree with you Alex. Greed eventually kills the long term viability of any business. Enron and WorldCom come to mind... Where are you based Alex? I want to do business with folks like you who build long term relationships. I have some wholesale deals all over the country.
Account Closed, over 14 years ago
Very good post. Strong relationships will make you far more money in the long term, and wholesaling is a volume business. If you can negotiate a slightly better deal all the better. If not close it, cash the check, and move on to the next one.
Ted Akers, over 14 years ago
Alex I agree with you some money is better then no money. Building relationships with returning buyers is one of the many goals us as investors need to keep in mind at all times. I wish you much success. LeJonR
LeJon Ratchford, over 14 years ago
Interested in your virtual deal system.
Michael, over 14 years ago
I agree as well, Alex. It is great that you value relationship over a little extra money. That kind of mentality will benefit your business in the long run!
Joshua Dorkin, about 15 years ago
Alex, You are too right. There is a prevailing attitude amongst investors that makes them think that they have to get rich on every deal. An investor must value a deal with the long-term return on relationship in mind, being always weary of reciprocation or the lack there of, respect cannot be one sided. There are so few professional, competent, and courteous investors out there that you can really become a stand out with relatively little effort. Everyone seems to talk win-win but behaves very adversarial. Do the right thing even when no one is looking and you’ll get noticed. I am very interested in your system. Post some more details on this virtual assitant. That sounds like something I could use. I’m a direct buyer. I would love to look at some of your deals. Justin Pierce Snow Goose Homes LLC
Justin Pierce, about 15 years ago