Big goals need big plans – what are yours this financial year?

CRE Success Principle: Whether it’s incremental or transformational, growth starts with a conscious decision. Don't let external conditions set the pace; define your own trajectory.

When a new financial year begins, we may be more focused on the numbers, but how often do we stop to define the kind of growth we actually want?

In the latest episode of Commercial Real Estate Leadership, I explore the difference between incremental and transformational growth and what each path requires from a people, strategy and systems perspective.

Incremental growth might mean increasing lead flow, lifting conversion rates or improving systems.

Transformational growth could involve redefining your role, restructuring your team or serving a new segment within your market.

Whether your goal is to grow revenue, lift profit or gain more personal freedom, this episode will help you get clear on what’s possible and what it takes to make it happen.

Because unless you’ve got a plan – with the tools and support to execute – it’s just a pipe dream.

The financial year is only just beginning – make sure it doesn’t pass by without intention, direction and clarity of the vision you really want to achieve.

Listen now and define the year ahead on your terms.

And if you need support mapping your next steps, I invite you to start the conversation by sending an email to [email protected] with “grow” in the subject line.

Episode transcript:

 Here in Australia, we are very lucky because we get two times a year to pause, reflect and reset as business owners.

We can do it on the 1st of January when the rest of the world is doing the same thing, because that's the start of the new year.

But then there's also the start of the financial year, which is of course the 1st of July, which was yesterday in terms of the date of release of this episode.

And as we enter the new financial year, I want to ask you, what kind of year would you like 2025-2026 financial year to be?

Is this going to be year of incremental growth or is it going to be a year of transformational growth? Let's define what that growth looks like and talk about some of the things that you might want to consider as you plan for growth in your business over this new financial year.

This is Commercial Real Estate Leadership. I'm your host, Darren Krakowiak. We're up to episode 227 and we are here to help commercial real estate principals to lead better, grow faster and to stress less.

And you can do all of those things when you've got a clear idea of where you want to go. Once you've set your goals, you then want to put in place the strategy that's going to help you get there.

And then of course, you need to execute with the right tools and systems and mechanisms and sounding boards and accountability to ensure that you do the things that are going to make the goal that you set more likely to occur.

So, as I mentioned at the top of the episode, there are two main strategies for growth, or two main lanes if you like, because we either want to grow incrementally, which is kind of like the 15 to 20% growth.

And then there's transformational growth, which I'll say is like, you know, when we want to double the business in terms of top line, bottom line, or even maybe double the freedom that you as a business owner have, right?

So, if last year you took three weeks off your business to go away, you might say, “This year I'd like to double that, I'd like to have six weeks off.” What does that look like? What needs to change?

Because the transformation that you're looking for is not just about top line revenue. There are different things that are important to different people.

And once we know what we want, we can then create the system and apply the strategy and give you the support to make sure that you are going to get there.

Now, if you're saying, “You know what, I'd be happy to sort of have 5 or 10% growth in my business over this financial year.”

I've got to tell you that I can't help you with that. Well, I can, but I don't want to because all of my clients, I'm asking them to be a little bit more ambitious with the growth targets that they're setting.

And the reason for that is because the market will give you 5 or 10% growth, right? CPI will be 3%.

A lot of the markets we operate in are growing at 5% or more a year in terms of the rental rates, in terms of the capital values, which will flow right through into your top line revenue on transactions, but also on property management fees.

And then on leasing and also on property management fees, we get some reversion to market when we've seen certain properties that have been maybe on fixed increases that have been favourable to the tenant.

I'm not seeing many cases with my clients right now where we are seeing market reviews that are leading to steep decreases. And of course there are often ratchet clauses that prevent that.

But quite often there are opportunities for us to grow without a lot of effort at around that 5%, 10% level just because of what's going on in the market.

And if you are not growing, you are dying. And if you're only growing at 5%, then you're probably not growing in real terms.

So that's why we want to focus on incremental growth and just defining it around that 15% mark, or looking at transformational growth.

So, incremental growth is generally achieved through improving the way that we do things. It might be improving some of our existing systems. It might be improving the performance of team members or making some tactical tweaks.

So, some of the ways that you might look to do that is just by tightening your prospecting routines or making sure that we are chasing down every lead.

We want to generate more leads. We want to put more opportunities into the top of the pipeline, so more opportunities come out of the bottom of the pipeline.

Also, we can look to improve our conversion rates, so more of the leads that we put into our pipeline become listings or become property management agreements.

Another way that we can incrementally improve the business is just to do things a little bit more efficiently, whether that's through technology or just through process improvement.

When we can get deals done a little bit more quickly, or it takes a little bit less time to do them, then we can increase the number of deals that we do within the financial year.

Now you can also choose to, I guess, deliberately move into a slightly higher value bracket in your market to incrementally grow the size of your business, but they're the main ways that I'd be recommending to incrementally improve a business in commercial real estate agency.

Now, on the other hand, if you're looking for transformational growth, we are talking about, I think, different things.

As I said, transformational growth, we're talking about doubling the revenue at the top line, doubling the profit at the bottom line, or maybe doubling the freedom for the principal.

So, this requires a real rethink of the structure of the business, the way that you lead, the way that you spend your time.

It might involve some difficult or uncomfortable decisions, or at least some difficult conversations with yourself around the way that you are turning up and the contribution that you are making and where you are spending your time, but also with your team members, making sure we've got the right people in the right seats.

It might involve letting go of some ways of doing things that have always been done a certain way, but perhaps don't serve the purpose and goals that you've set for transforming the way your business operates.

And it could also lead to you having a look at certain clients that you are working with who perhaps are not going to make it on this journey of transformation that you are on.

Now, whether you want to have incremental growth in your business or transformational level growth in your business in the 2025/2026 financial year, either is perfectly fine. And I help my clients achieve both categories of growth.

But they do require, I think, different levels of commitment, a different type of clarity about the future, and also different levels of support from your team and from external sources.

So, as I've just mapped out what an incremental growth future looks like and what a transformational growth looks like, I want you to have a think about, well, how would you like your business to look in 12 months from now?

Do you want to see it be 15% bigger on the top line or the bottom line? Or do you want to fundamentally change what is possible in your business?

Because the incremental growth is going to be about things like executing better, having clearer KPIs, and having stronger points of accountability within the business.

But the transformational growth, I think, is going to be more about getting really clear on what your vision is, implementing some key structural changes, ensuring that you've got alignment within your team and you as a leader being very, very committed to that vision and being able to make the decisions that are required in order for the business to get there.

Now, of course, anyone can just say, “I want to grow my business by 15% or 30% or 100% within 12 months.” But that doesn't mean anything unless we've got a plan in place to get there.

So, once we've set the goal, we need to decide on, well, what's the strategy that's going to help us achieve this result?

What are the tools? What are the frameworks that is going to get us there? And do I have the right support? And who's holding me accountable to make sure that I'm going to do the things that I said are required in order to achieve that result?

Now, if you've been listening to this episode and thinking, “You know what? I want to make this happen. In the next 12 months, I want to grow my business by X percent at the top line, the bottom line. I want to change the way that the business operates in terms of the level of commitment that it requires from me.”

And not just in terms of your commitment to the result, but also it might be around the amount of time that you have to physically spend in your business.

I can help you make that happen. But it does start with you taking an initial first step.

So if you'd like to brainstorm some ideas on how we can get this result in your business, talk about what it is that's important to you, unpack the obstacles that are in the way, and also get an understanding of what it is that really are your natural strengths that you can leverage to ensure that we are using everything that is within your toolkit, that is at your disposal to ensure that you get that result.

Then I want to invite you to open your internet. Then I want to invite you just to do something simple, which is to send me an email with the word “grow” in the subject line.

You can send it to [email protected]. Put “grow” in the subject line, and that'll just tell me that you want to have a conversation about your business and growing it in 2025, 2026.

The message I want to leave you with is that it's the start of the new financial year, and we don't want to just let the year happen to us, right?

We can decide the type of year that we have, and it starts with just deciding on, well, what type of growth do you want? Do you want incremental growth or do you want transformational growth?

And there's nothing wrong with incremental growth. Like I said at the start, the only growth I've got a problem with is no growth or no real growth.

So, whether it's one or the other and you want some support with getting the right plan to make sure that you get there, then let's have a conversation and make it happen in 2025-2026.

That is our episode for today. Thank you so much for listening. And I will speak to you soon.