Today’s REI Classroom Lesson

As John Martinez explains, you aren’t always going to provide the best offer (to a buyer or seller). When this happens, you need to be fully aware of your real competitive advantage so that you are still able to be the offer they choose.

REI Classroom Summary

Consider your strengths when working with a buyer or seller. Do you excel in building rapport with them? Maybe it’s your systems you’ve put in place to ensure a smooth deal. Know what your competitive advantage is and utilize it so that even if you aren’t the best offer, you’re the one they want to work with.

Listen to this REI Classroom Lesson

Real Estate Investing Classroom Show Transcripts:

Mike: Welcome back to the REI Classroom, where experts from across the real estate investing industry teach you quick lessons to take your business to the next level. And now, let’s meet today’s expert host.
John: Hi, my name is John Martinez. This is REI Classroom. My company is Today, I want to talk about how you really need to identify your real competitive advantage.
Mike: This show is sponsored by
John: Once you hit the market, once you hit the real estate investment market, once you’re trying to pick up homes for a discount, or operate whatever type of real estate business you’re in, whether it’s selling wholetail or retail, turnkey investments, you have to first do one thing, and that’s identify your real competitive advantage.
You see, in the absence of any other value, money is going to be all that matters. If you’re in the wholesale game, if you want to buy properties, your offer is not always going to be the highest. Now, how do you win those deals when your offer is not the highest, or you’re going to have to make up that gap in values somehow, and the only way you’re going to be able to make up that gap is by your competitive advantage?
So you need to identify, before you do anything, really what your specific advantage is over your competition or over buyer’s or seller’s other options. This is how you’ll be able to bridge that gap between price because oftentimes, you’re not going to have the right price. It’s going to be too high, if you sell them, it’s going to be too low if you’re making offers. So if you focus on just price, it’s a race to the bottom. Margins are paper thin, you can’t build a business that way. So we really need to focus on this. When we talk about competitive advantage, it doesn’t have to be anything huge. It’s just what matters to your prospects.
So it could be your process. We have a streamline process to make sure you don’t see any hiccups, bumps in the road. Very easy for you. It could be our conversation. We’re really down-to-earth. We sit down, we have a face-to-face conversation. I won’t use the real estate lingo. I won’t confuse you. I’ll make it super simple and straightforward. It might mean that you take the time to understand their situation better than anyone else does. That’s your competitive advantage. Oftentimes, it’s going to be your behind-the-scenes processes and the type of experience it leads to, really for your prospect.
So I have an analogy I like to use. I look at this like chocolate cake. So you might go in and talk to a prospect, and, “You want to buy my house? This guy wants to buy my house. This guy wants to buy my house. All these investors want to buy my house. Why should I choose you?” The answer to that is this. It’s our process. You see, I use the chocolate cake analogy. There are lots of real estate investors out there. Honestly, we all have the same tools, we have access to the same information, we use the same closing companies, we use the same comps, we use the same technology, we all use the same stuff. So why should you choose me over someone else?
Well, it’s like when you bake a cake. You see, I can’t cook at all, but my grandma, my grandma could cook like crazy. She could bake. Every holiday was amazing. So when we go to grandma’s house, if she was going to bake a chocolate cake, she could lay every one of those ingredients on the counter. The flour, the sugar, the cocoa, everything we need to make it. She could lay out those same exact ingredients for me, the same tools. Now at the end of the day, her chocolate cake is going to be delicious. I don’t know how to cook, so even though I have the same tools, mine is going to be horrible.
So process, a lot of times, is what we can fall back on as our competitive advantage because the way we use the tools, the way we mix all our ingredients can lead to a better outcome for our prospects. So that’s one example.
The bottom line is this, whatever it is, when you attack a market, you need to know what your competitive advantage is, why someone would do business with you versus your competitor. There are certain ways you can really bring out those competitive advantages, really make your prospect realize what they are, and you have ways to value on them, really put a dollar figure on those. But again, it all starts with identifying your competitive advantage. That’s going to lead to better sales and higher margins.
My name is John Martinez with Midwest Revenue Group. You can find us at This is REI Classroom.
Mike: is your source for turnkey, done-for-you rental properties. If you’d like to be an investor and not a landlord, please visit to learn how to purchase cash-flowing, professionally-managed rental properties in the hottest rental markets across the country. We can also help connect you with financing for your next property. Invest the easy way today, and get started by visiting
Please note, the views and opinions expressed by the individuals in this program do not necessarily reflect those of or any of its partners, advertisers or affiliates. Please consult professionals before making any investment or tax decisions, as real estate investing can be risky.
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