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Business Plan Plan For Success

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CB Student Workbook for Business Planning

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Business Plan Plan For Success

  1. 1. Plan ForPlan For Your SuccessYour Success For The Experienced Real EstateFor The Experienced Real Estate Sales ProfessionalSales Professional Participant WorkbookParticipant Workbook
  2. 2. Plan For Your Success 2 6.1.07 6.1.07
  3. 3. IntroductionIntroduction GUIDE TO BUSINESS PLANNING Studies have shown that those engaged in business planning consistently outperform those with no business planning. While planning does not ensure success in accomplishing goals, it is rare to succeed solely by luck or circumstance. This planning guide is designed to take an “experienced real estate sales professional” through the business planning process. The course will help you define where you are today and how in the coming months you can reach your chosen goals. TABLE OF CONTENTS Steps In The Planning Process..............................................................................................4 Step I: Situational Analysis ....................................................................................................5 My Sales and Production Statistics........................................................................................7 My Recent Sources Of Business............................................................................................8 My Personal Strengths & Weakness......................................................................................9 Business Expenses: Past 12 Months...................................................................................11 Step II: Determine Your Objectives......................................................................................12 Step III: Develop Strategies .................................................................................................13 Step IV: Develop Tactics .....................................................................................................14 Plan Worksheet ...................................................................................................................15 Step V: Measuring My Plan Results.....................................................................................16 My Personal Business Plan.......................................................................................................................17 Situational Analysis ..............................................................................................................18 My Sales and Production Statistics......................................................................................20 My Recent Sources Of Business..........................................................................................21 My Personal Strengths & Weakness....................................................................................22 Business Expenses: Past 12 Months...................................................................................24 Plan Worksheet....................................................................................................................25 Measuring My Plan Results..................................................................................................26 Plan For Your Success 3 6.1.07
  4. 4. Steps In The Planning ProcessSteps In The Planning Process STEP I: SITUATIONAL ANALYSIS - “WHERE YOU ARE TODAY” Business planning provides you with guidelines for making sound business decisions. The first step in developing your plan begins with a written analysis of you and your marketplace… “where you currently are” in terms of your business goals. STEP II: OBJECTIVES - “WHAT YOU HOPE TO ACHIEVE” Objectives represent the desired outcome you hope to attain within a given period of time. They answer the question, "What do I hope to achieve?" The objectives of a business plan provide direction and serve as standards for evaluating performance. Well-written objectives are specific, measurable, attainable, realistic, and time-oriented (SMART).  (S)pecific  (M)easurable  (A)ttainable  (R)ealistic  (T)ime-oriented STEP III: STRATEGIES - “HOW YOU WILL ACCOMPLISH YOUR OBJECTIVES” Strategies outline “how to accomplish your objectives.” They are broad activities that are within your control. Strategies are not to be confused with goals. To differentiate between a strategy and goal, ask yourself…can I control this activity? If the answer is yes, then it is a strategy. STEP IV: TACTICS - “HOW TO MAKE YOUR STRATEGIES HAPPEN” Tactics are specific action steps for making each strategy happen. They include “who is responsible for what and when” and the expense involved. STEP V: PLAN MEASUREMENT - “EVALUATION OF YOUR PLAN RESULTS” Essential to the business planning process is the measurement of your plan’s success. A business plan should be revisited at least every 90 days. If your objectives and strategies are not working - change them! Plan For Your Success 4 6.1.07
  5. 5. Step I: Situational AnalysisStep I: Situational Analysis ““Where I Am Today”Where I Am Today” ANALYZING MY BUSINESS 1. I currently have a business plan:  yes;  no 2. My current business approach is:  just me;  me and a personal assistant;  me and a buyer broker;  my team:  other: ________________________________  What’s working well: ________________________________________________  What’s not working well: _____________________________________________ 3. What are the strengths of your business approach: ______________________________ _______________________________________________________________________ 4. What are the weaknesses of your business approach: ___________________________ _______________________________________________________________________ 5. I am managing my business well:  yes;  no Explain: __________________________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ 6. To what do you credit your past real estate success: _____________________________ _______________________________________________________________________ BUSINESS GROWTH 1. My strategy for building my business is working:  yes;  no Explain: ______________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ 2. My greatest challenge over the last 12 months has been: _________________________ _______________________________________________________________________ _______________________________________________________________________ 3. What could you have done over the last 12 months to improve your business? ________ Plan For Your Success 5 6.1.07
  6. 6. _______________________________________________________________________ 4. My greatest opportunities over the next 12 months: ______________________________ _______________________________________________________________________ _______________________________________________________________________ 5. Threats to my business over the next 12 months: _______________________________________________________________________ Plan For Your Success 6 6.1.07
  7. 7. My Sales and Production StatisticsMy Sales and Production Statistics Period: _______________________ Sources: MLS, office and personal records. COMMISSION INCOME:  Commission Income $_______________________  Transactions/Sides # _______________________  Average Commission $ _______________________ LISTINGS:  # of Listings Taken #_______________________  # of Listings Sold #_______________________  Percentage of Listings that Sold % ______________________  Average List Price $_______________________  Average Sale Price $_______________________  Average Sale to List Price Ratio % ______________________ BUYER CONTROLLED SALES:  Buyer Controlled Sales/Closed #_______________________  Average Sale Price $_______________________ REFERRALS:  Outbound referrals sent #_______________________ SALES AND PRODUCTION ANALYSIS  Can your percentage of listings “taken“ to “sold” be improved?  Yes,  No  Is your sale to list price ratio in line with market standards?  Yes,  No  Is your average listing taken/sold below the office average or your goal?  Yes,  No  What was your estimated contracts written to contracts closed ratio? ______ %  Why? Plan For Your Success 7 6.1.07
  8. 8. My Recent Sources Of BusinessMy Recent Sources Of Business Determine the source of business for your last 10 listings taken and 10 buyer controlled sales starting with the most recent. (past customer, relative, farming, FSBO, expired, etc.). LISTINGS TAKEN: Property or Name Source of Business  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________ BUYER CONTROLLED SALES: Property or Name Source of Business  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________ ANALYSIS  Do you see any trends (i.e. much business coming from few sources or most listings being taken in a certain geographic area or niche of buyers or sellers)?  Yes,  No  List issues or opportunities you see from this analysis. Plan For Your Success 8 6.1.07
  9. 9. My Personal Strengths & WeaknessMy Personal Strengths & Weakness  My greatest strengths _____________________________________________________  My greatest weaknesses ___________________________________________________  On a scale of 1 to 10 (10 being highest), evaluate yourself in the following areas:  Current financial position ________  Professional knowledge ________  Use of Systems ________  Use of Marketing Tools ________  Business Building/Prospecting Skills ________  Listing Skills ________  Selling Skills ________  Communication Skills ________  Where can you make improvement over the next 12 months? ______________________ _______________________________________________________________________ Analyzing My Target MarketsAnalyzing My Target Markets My geographic target market:  Current number of active listings ________  Average list price ________  Number of sales in the last 12 months ________  Average sold price ________  I would describe the current market as a (buyer, seller, balanced) market.  Estimated sales in the next 12 months will (increase, decrease, stable).  Is there a company or sales associate that is dominant in this market? Yes, No  Market analysis: (Rate 1-5 with 5 being excellent) Turnover _______ Affordable Housing _______ Economic climate _______ New construction _______ Anticipated growth _______ Support services nearby _______  Issues and/or opportunities: ________________________________________________ MY DEMOGRAPHIC TARGET MARKET Plan For Your Success 9 6.1.07
  10. 10.  Consists of: _____________________________________________________________ _______________________________________________________________________  Issues and/or opportunities: ________________________________________________ Plan For Your Success 10 6.1.07
  11. 11. Business Expenses: Past 12 MonthsBusiness Expenses: Past 12 Months GENERAL EXPENSE MARKETING EXPENSES Auto (gas, repairs, tolls, etc. $ __________ Newspaper ads $ _________ Insurance (auto) $ __________ Magazine ads $ _________ Insurance (E&O, other) $ __________ Direct mail production $ _________ Dues (board, mls ,license) $ __________ Church/club directories $ _________ Prof books, tapes, etc. $ __________ Promotional flyers $ _________ Education $ __________ Postage/delivery $ _________ Phone, pager $ __________ Yard signs/riders $ _________ Office supplies $ __________ Photography $ _________ Equipment (fax, tech, etc) $ __________ Closing gifts $ _________ Computer (hardware) $ __________ Other _________________ $ _________ Professional services $ __________ Other _________________ $ _________ Secretary/personal asst. $ __________ Other__________________ $ _________ Sales conferences $ __________ Other _________________ $ _________ Gifts $ __________ Other _________________ $ _________ Entertainment $ __________ Other _________________ $ _________ Other _________________ $ __________ Other _________________ $ _________ Sub-Total General Expense: $__________ Sub-Total Marketing Expense: $ __________ TOTAL EXPENSE: $ _______________ Put an * next to each expense category you can improve upon. EXPENSE SUMMARY  Commission Income + $_______________  General and Marketing Expenses - $_______________  Profit/Loss Profit = $_______________  Marketing Expense as % of income _______________ % (Marketing Exp ÷ Commission Income) (Top producers invest 8-10%) Plan For Your Success 11 6.1.07
  12. 12. Step II: Determine Your ObjectivesStep II: Determine Your Objectives ““What I Hope To Achieve"What I Hope To Achieve" Objectives provide direction within a given period of time and serve as standards for evaluating performance. Develop “SMART” objectives:  (S)pecific  (M)easurable  (A)ttainable  (R)ealistic  (T)ime-oriented SAMPLE PLAN OBJECTIVES 1. To earn an annual personal income of $ _________________. 2. Increase my listings taken from _____ to _____ in _________. 3. Increase my listings sold from _____ to _____ in _________. 4. Increase my commission income from _____ to _____ in _________. 5. Increase my buyer controlled sales from _____ to _____ in _________. 6. To spend _____ % of my personal income on personal promotion. 7. To work a maximum of ___ days per week and take ___ weekends off per month. 8. Professional development __________________________________________________ _______________________________________________________________________ 9. Personal development ____________________________________________________ _______________________________________________________________________ 10. Technology Plan: My annual budget is _______________ . My needs are ____________ _______________________________________________________________________ 11. Financial planning and retirement program _____________________________________ _______________________________________________________________________ Plan For Your Success 12 6.1.07
  13. 13. Step III: Develop StrategiesStep III: Develop Strategies ““How Will I Accomplish My Objectives”How Will I Accomplish My Objectives” Strategies are broad activities that are within your control. Generally, it will take more than one strategy to accomplish an objective. By the same token, however, each strategy, if carefully planned and implemented, can accomplish a number of tasks at the same time. For example, farming a higher price range area could increase your average commission dollar as well as help to meet your listing objective. Get additional mileage for your efforts by implementing strategies that serve multiple purposes. THOUGHT STARTERS FOR LISTING STRATEGIES:  Visit/Call FSBO's  Call expired listings  Use Tell 2O on all listings  Use 7 second presentation more often  Obtain appropriate price reductions  Establish a client follow up program  Development of farm areas  Use Seller Service System FOR SALES STRATEGIES:  Hold open houses  Contact former customers  Better buyer qualification  Use 7 second presentation more often  Better use of the Best Buyer System  Development of farm areas  Increase personal promotion  Use the Best Buyer Follow up program FOR COMMISSION/PROFIT STRATEGIES:  Increase the number of listings  Better customer follow-up  Work in higher price range  Hire an assistant  Contact previous customers  Take salable listings  Obtain appropriate price reductions  Decrease/increase business expenses SAMPLE OBJECTIVE WITH STRATEGY: Objective: Increase my buyer controlled sales from 18 to 22 in 2007. Strategy: Hold at least 2 Open Houses per month. Plan For Your Success 13 6.1.07
  14. 14. Step IV: Develop TacticsStep IV: Develop Tactics ““How Will I Make My Strategies Happen”How Will I Make My Strategies Happen” Tactics are the specific steps for making each strategy happen. Unless the strategies are broken into very specific steps (tactics), the objectives will not be met. Use a planning worksheet to organize your strategies and tactics in such a way that everything is at your fingertips. That way you will know immediately who will be responsible for what and when for each action step and the expense involved. TACTIC ELEMENTS Action When Who Cost Completed ________________________________/_________/____________/________/__________ ________________________________/_________/____________/________/__________ ________________________________/_________/____________/________/__________ ________________________________/_________/____________/________/__________ SAMPLE OBJECTIVE, STRATEGY AND TACTIC: Objective: Increase my buyer controlled sales from 18 to 22 in 2007. Strategy: Hold at least 2 Open Houses per month. Tactics: Decide on house to hold open and date. Preparation for and conduct the open house. Follow-up with visitors and seller. Plan For Your Success 14 6.1.07
  15. 15. Plan WorksheetPlan Worksheet Objective: (What you hope to achieve) _________________________________________ __________________________________________________________________________ __________________________________________________________________________ Plan For Your Success 15 6.1.07 Strategy: (How to accomplish) __________________________________________________ ____________________________________________________________________________ Tactic: (How to make my strategy happen) Action When Who Cost Completed ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ Strategy: (How to accomplish) __________________________________________________ ____________________________________________________________________________ Tactic: (How to make my strategy happen) Action When Who Cost Completed ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ Strategy: (How to accomplish) __________________________________________________ ____________________________________________________________________________ Tactic: (How to make my strategy happen) Action When Who Cost Completed ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________
  16. 16. Step V: Measuring My Plan ResultsStep V: Measuring My Plan Results PLAN YEAR: _____________________ JAN FEB MAR APR MAY JUNE LISTINGS Taken Goal Actual + - Goal Sold Goal Actual + - Goal BUYER CONTROLLED SALES Goal Actual + - Goal COMMISSION INCOME Goal Actual + - Goal JULY AUG SEPT OCT NOV DEC LISTINGS Taken Goal Actual + - Goal Sold Goal Actual + - Goal BUYER CONTROLLED SALES Goal Actual + - Goal COMMISSION INCOME Goal Actual + - Goal Plan For Your Success 16 6.1.07 IF YOUR OBJECTIVES/STRATEGIES ARE NOT WORKING - CHANGE THEM!
  17. 17. My PersonalMy Personal Business PlanBusiness Plan For: ___________________________________ Plan Period: From _____________ To ________________ MY PERSONAL COMMITMENT I have carefully considered my personal commitment toward furthering my real estate career and hereby commit myself to the effort and sacrifices necessary to achieve my goals. I agree to track my results and meet regularly in a planning session with my manager in order to review my progress and make plan changes as needed. Associate: ___________________________________ Date: _________________ Manager: ___________________________________ Date: _________________ Plan For Your Success 17 6.1.07
  18. 18. Situational AnalysisSituational Analysis ““Where I Am Today”Where I Am Today” ANALYZING MY BUSINESS 1. I currently have a business plan:  yes;  no 2. My current business approach is:  just me;  me and a personal assistant;  me and a buyer broker;  my team:  other: ________________________________  What’s working well: ________________________________________________  What’s not working well: _____________________________________________ 3. What are the strengths of your business approach: ______________________________ _______________________________________________________________________ 4. What are the weaknesses of your business approach: ___________________________ _______________________________________________________________________ 5. I am managing my business well:  yes;  no Explain: __________________________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ 6. To what do you credit your past real estate success: _____________________________ _______________________________________________________________________ BUSINESS GROWTH 1. My strategy for building my business is working:  yes;  no Explain:______________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ _______________________________________________________________________ 2. My greatest challenge over the last 12 months has been: _________________________ _______________________________________________________________________ _______________________________________________________________________ 3. What could you have done over the last 12 months to improve your business? ________ Plan For Your Success 18 6.1.07
  19. 19. _______________________________________________________________________ 4. My greatest opportunities over the next 12 months: ______________________________ _______________________________________________________________________ _______________________________________________________________________ 5. Threats to my business over the next 12 months: _______________________________________________________________________ Plan For Your Success 19 6.1.07
  20. 20. My Sales and Production StatisticsMy Sales and Production Statistics Period: _______________________ Sources: MLS, office and personal records. COMMISSION INCOME:  Commission Income $_______________________  Transactions/Sides # _______________________  Average Commission $ _______________________ LISTINGS:  # of Listings Taken #_______________________  # of Listings Sold #_______________________  Percentage of Listings that Sold % ______________________  Average List Price $_______________________  Average Sale Price $_______________________  Average Sale to List Price Ratio % ______________________ BUYER CONTROLLED SALES:  Buyer Controlled Sales/Closed #_______________________  Average Sale Price $_______________________ REFERRALS:  Outbound referrals sent #_______________________ SALES AND PRODUCTION ANALYSIS:  Can your percentage of listings “taken“ to “sold” be improved?  Yes,  No  Is your sale to list price ratio in line with market standards?  Yes,  No  Is your average listing taken/sold below the office average or your goal?  Yes,  No  What was your estimated contracts written to contracts closed ratio? ______ %  Why? Plan For Your Success 20 6.1.07
  21. 21. My Recent Sources Of BusinessMy Recent Sources Of Business Determine the source of business for your last 10 listings taken and 10 buyer controlled sales starting with the most recent. (past customers, relative, farming, FSBO, expired, etc.). LISTINGS TAKEN: Property or Name Source of Business  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________ BUYER CONTROLLED SALES: Property or Name Source of Business  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________  _________________________________ ___________________________________ ANALYSIS  Do you see any trends (i.e. much business coming from few sources or most listings being taken in a certain geographic area or niche of buyers or sellers)? Yes, No  List issues or opportunities you see from this analysis. Plan For Your Success 21 6.1.07
  22. 22. My Personal Strengths & WeaknessMy Personal Strengths & Weakness  My greatest strengths _____________________________________________________  My greatest weaknesses ___________________________________________________  On a scale of 1 to 10 (10 being highest), evaluate yourself in the following areas:  Current financial position ________  Professional knowledge ________  Use of Systems ________  Use of Marketing Tools ________  Business Building/Prospecting Skills ________  Listing Skills ________  Selling Skills ________  Communication Skills ________  Where can you make improvement over the next 12 months? ______________________ _______________________________________________________________________ Analyzing My Target MarketsAnalyzing My Target Markets My geographic target market:  Current number of active listings ________  Average list price ________  Number of sales in the last 12 months ________  Average sold price ________  I would describe the current market as a (buyer, seller, balanced) market.  Estimated sales in the next 12 months will (increase, decrease, stable).  Is there a company or sales associate that is dominant in this market? Yes, No  Market analysis: (Rate 1-5 with 5 being excellent) Turnover _______ Affordable Housing _______ Economic climate _______ New construction _______ Anticipated growth _______ Support services nearby _______  Issues and/or opportunities: ________________________________________________ MY DEMOGRAPHIC TARGET MARKET Plan For Your Success 22 6.1.07
  23. 23.  Consists of: _____________________________________________________________ _______________________________________________________________________  Issues and/or opportunities: ________________________________________________ Plan For Your Success 23 6.1.07
  24. 24. Business Expenses: Past 12 MonthsBusiness Expenses: Past 12 Months GENERAL EXPENSE MARKETING EXPENSES Auto (gas, repairs, tolls, etc. $ __________ Newspaper ads $ _________ Insurance (auto) $ __________ Magazine ads $ _________ Insurance (E&O, other) $ __________ Direct mail production $ _________ Dues (board, mls ,license) $ __________ Church/club directories $ _________ Prof books, tapes, etc. $ __________ Promotional flyers $ _________ Education $ __________ Postage/delivery $ _________ Phone, pager $ __________ Yard signs/riders $ _________ Office supplies $ __________ Photography $ _________ Equipment (fax, tech, etc) $ __________ Closing gifts $ _________ Computer (hardware) $ __________ Other _________________ $ _________ Professional services $ __________ Other _________________ $ _________ Secretary/personal asst. $ __________ Other__________________ $ _________ Sales conferences $ __________ Other _________________ $ _________ Gifts $ __________ Other _________________ $ _________ Entertainment $ __________ Other _________________ $ _________ Other _________________ $ __________ Other _________________ $ _________ Sub-Total General Expense: $__________ Sub-Total Marketing Expense: $ __________ TOTAL EXPENSE: $ _______________ Put an * next to each expense category you can improve upon. EXPENSE SUMMARY  Commission Income + $_______________  General and Marketing Expenses - $_______________  Profit/Loss Profit = $_______________  Marketing Expense as % of income _______________ % (Marketing Exp ÷ Commission Income) (Top producers invest 8-10%) Plan For Your Success 24 6.1.07
  25. 25. Plan WorksheetPlan Worksheet Objective: (What you hope to achieve) _________________________________________ __________________________________________________________________________ __________________________________________________________________________ Plan For Your Success 25 6.1.07 Strategy: (How to accomplish) __________________________________________________ ____________________________________________________________________________ Tactic: (How to make my strategy happen) Action When Who Cost Completed ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ Strategy: (How to accomplish) __________________________________________________ ____________________________________________________________________________ Tactic: (How to make my strategy happen) Action When Who Cost Completed ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ Strategy: (How to accomplish) __________________________________________________ ____________________________________________________________________________ Tactic: (How to make my strategy happen) Action When Who Cost Completed ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ ____________________________________/___________/____________/__________/ ________ Make copies
  26. 26. Measuring My Plan ResultsMeasuring My Plan Results PLAN YEAR: _____________________ JAN FEB MAR APR MAY JUNE LISTINGS Taken Goal Actual + - Goal Sold Goal Actual + - Goal BUYER CONTROLLED SALES Goal Actual + - Goal COMMISSION INCOME Goal Actual + - Goal JULY AUG SEPT OCT NOV DEC LISTINGS Taken Goal Actual + - Goal Sold Goal Actual + - Goal BUYER CONTROLLED SALES Goal Actual + - Goal COMMISSION INCOME Goal Actual + - Goal Plan For Your Success 26 6.1.07 IF YOUR OBJECTIVES/STRATEGIES ARE NOT WORKING - CHANGE THEM!

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