BiggerPockets

I meant to say I talk alot with my father-in-law who is a successful business person in our town. He runs a paving business, the leader in the county. He's teaching me about business management and the rest I have included above..

Are you asking how to manage the operations of a buy-and-hold residential business? What sales are you referring to? Finding tenants?

Much of business is just hard work, common sense, being willing to try new things, learning from your mistakes, etc. It also involves being able to deal with some uncertainty and being willing to take calculated risks. If you want to run a larger business, you will need to be able to recruit and train people so that you do not perform all the functions of the business yourself.

The terms "operations" and "sales" can be used in many different ways, but every business must deal with these things.

In real estate, operations involves the details of ensuring that your properties are put to their highest and best use, and remain there, generating as much long-term cash-flow/appreciation as possible. This could be the work you do to rehab a property, the work you do to find quality renters, the work you do to keep your renters happy and keep the properties in good condition, the work you do to market and sell your properties, etc.

From a sales perspective, real estate involves ensuring that your assets are generating profits for you -- either cash-flow and/or appreciation. Sales could be the process of renting your properties, selling them, developing them, etc.

Btw, in addition to the things you've mentioned, there are a few other aspects to your business that you I think you need to be comfortable with to ensure success:

- Forecasting Cash-Flow. Many business owners realize that not property forecasting cash-flow can put them in a situation where they can't pay the bills, but they ignore the other end of the spectrum -- without a good cash-flow forecast, you can't grow your business optimally either. To grow your business optimally, you must understand what your cash-flow will look like over a reasonable period into the future.

- Having a Plan. Without a plan, your business is going to run you, and you'll never accomplish your goals. There are different reasons to want to run a business (freedom, feeding your family, personal satisfaction, creating a legacy, building wealth for future generations, etc), and if you don't know what your goals are for running your business, you'll end up building a business that doesn't give you what you need from it.

- Know Your Market. To build a successful business, you need to understand your customers and their needs. But, it's easy to assume that your customers and their needs will be the same next year (and the year after, etc) as they are now. This generally isn't the case. You must constantly have your finger on the pulse of your market, and more importantly, you need to be prepared to change when your market changes.

Are you sure? I know a lot of people who say they want freedom, but in reality they want wealth...

For example, you can achieve freedom by purchasing a very cheap property, paying it off quickly, moving in, and then building enough cash flow to pay for the basics -- food, clothes, used car, insurance, etc.

That would give you freedom from having to work for someone else...

The problem is, most people want more than that -- they want a nice house, a couple cars, good food, vacations, toys/gadgets, etc. This is over and above freedom and requires a good bit more cash flow than just simply having freedom.

So, do you really just want freedom? Or do you want more than freedom?

Bryan, freedom is a nice word but it is not a "plan". It is a goal (perhaps even a dream).

A plan is something that should be sufficiently specific that you can act upon it. An easy way to tell the difference is to ask yourself whether you can show your "plan" to someone else and whether they will be able to figure out exactly what you are going to do. If they can, it is a plan. Otherwise, it is something else.

BTW, do not assume that you can spend as little once you are wealthier as you do now. I do not consider myself an extravagant person but I am sure I would seem that way to people with less money. Your spending does increase as you make more money, although, hopefully, not at the same rate.