Excuse Me, Are You A Trainer?
Updated: Jul 14, 2019
Just a few days after I launched my Singaporean Landlord book, I had more than a few queries about whether I am a trainer. I decided to do some research on the training industry. There are a few names, some bigger than the other. I spoke to a few students and tried to understand the situation better. I also met some students in person where time permits.
I shared with them about my thoughts regarding the training industry and that I am unlikely to go into such an industry because I don't think training is a sustainable business if the aim is to ensure each and every student performs well. To me, coaching can be a more sustainable business and a win-win for all parties.
Generally, a trainer would ask for amounts between $2000-3000 for a 3 day course or upwards to $6000 for something more intensive. Imagine you are crammed with 50 other students and trying to "study" together in a crash course. While the environment might be ideal for networking and learning together, the amount of information retained and practically utilised in the future might be lacking due to lack of follow-up action on both parties.
Next, if the idea of the training is that you can rent a property, design it nicely, find the right tenants in and make $1000-2000 per month, I would suggest to take a look at the bigger picture. First, if you have 50 other students all trying to rent apartments at the same time, your costs will go up as rental creeps up. Second, what makes you think there are 50 other apartments in the market waiting for you to rent? Third, even if you find an apartment, you will need to spend time and effort to furnish the entire apartment, conduct 30-50 viewings to find the right tenants. So assuming you spend $3000 on the training course, $9000 on furnishing the apartment, and your Net Operating Income (NOI) is only $1500 per month, you will need 8 months before you start making profits. Is it worth it? It doesn't take an Einstein to figure out who is really raking in the profits.
The kicker is when the trainer tells you that this course is only introductory and if you need more help, it will cost you another $6000.
Generally, a coach would ask for around $6000 per year to guide you in your property journey. This might work because you will not be crowding with the others for $1500 NOI per month. Your property coach should be guiding you towards $2500 NOI per month or perhaps even $3000 NOI per month. Assuming you spend $6000 on the coach, $9000 on furnishing the apartment, and your NOI is $2500, you breakeven in 6 months. If your NOI is $3000, you breakeven in 5 months. To me, this is not the best way to do sustainable coaching.
Alternatively, a coach can ask for a small engagement fee of $1000 per year, and offer to profit share based on your NOI. So if your NOI is $2500, and the profit share is 20%, you spend $1000 on the coach, $9000 on furnishing the apartment and share 20% profits so your NOI is effectively $2000, your breakeven is in 5 months. If your NOI is $3000 (effectively $2400), you breakeven in 4 months 5 days. I believe this method is the win-win coaching method because there is incentive for the coach to help each trainee achieve higher NOI. If I ever do coaching, I plan to employ this method or something similar.
Making money is never easy unless you are a bank. Be wary if anyone tells you otherwise.