Help-U-Sell is a broker-centric business model, which is to say: the broker is in control of the business. He/she takes responsibility for studying the market, designing and implementing the marketing, generating the leads, converting them to listings and sales and ensuring the survival and growth of his company. That does not imply that there is no place in a Help-U-Sell office for agents.
True, if you look at the issues that plague traditional real estate offices, you can easily conclude that the agents are the problem. Their huge commission splits, constant shopping for a better deal and complacent acceptance of sub-standard productivity have all but destroyed any chance for a traditional broker to make a reasonable profit. But truth is: that’s not a problem with the agents, it’s a problem with the broker.
Traditional brokers adbicated their leadership role to agents back in the 80’s. Forced to compete with 100% companies, they allowed their commission splits to soar to impossible heights. Less company dollar meant cutting marketing budgets, focusing what cash there was on attracting more agents. (It’s really sad that so many brokers who averaged less than 25% of GCI as company dollar thought that if they just had more agents they’d somehow make it up in volume!)
The issue isn’t agents. It’s broker control.
The Help-U-Sell model is absolutely suited to agent populated offices if the broker stays in control. This means:
- The broker decides when, where and how to market — he doesn’t leave this up to the agents
- The broker pays for the marketing
- The broker considers every lead that comes into the office to be his
- The broker demands a high level of performance in converting leads to clients to sales
- The broker hires only when the business grows to the point that another person is needed (the Buyer Pool is his gauge)
- The broker stays primarily responsible for the listing function. That means he takes the listings or has an assistant stand in for him.
- The broker pays buyer agents in the 50%-60% range — which makes sense because he’s furnishing all the leads and is not asking them to knock doors, cold call or take lisitngs
- The broker holds everyone accountable and does not hesitate to eliminate poor performers
Agents flourish in this environment. They come to work every day with something to do, confident that there will be another buyer and another buyer to keep them busy because the broker is marketing and the marketing works.
Sellers receive maximum exposure because the office has a well thought out marketing program in place, controlled by the broker, not a bunch of individual agents.
Buyers get to work with specialists who aren’t distracted by the listings that aren’t selling or the ad that’s due today or anything else that goes on in the other side of the office.
The Broker smiles every month when he sees his bottom line. His business makes sense because he stayed in control.
5 thoughts on “Agents Are The Problem, Right? Wrong”
I am in the process of starting to build a team and, as usual, James is right on! In addition to Science to Sales, I will have prospects read this blog items “Who We Are” and “No More Begging”. Agents will be required to have a lap top and cell with email and internet. Some will make it to 60% based on reasonable production AND they must wear branded clothing and have a sign on their car.
Hey, Dan, There are lots Help-U-Sell brokers who have been successful with the agent model. You might want to pick a couple of brains. John Powell is certainly one as is Jack Bailey. Robin Rowland in Sonora, CA added a buyers agent this year and it’s solved many problems for her. And Ken Kopcho in Santa Maria, CA is another that comes to mind. I like what you’re planning, and you’ll want to make sure your leads managment system is running well — it’s the key to monitoring performance and accountability.
As far as a team builder, I find it helpful to remember that my number one priority is to be a Lead Aggregator. I call myself that to my agents. I assume that repsonsibility and am held accountable for it. When I’m wearing my Broker/Owner hat and considering new procedures, marketing, staff etc. I’m always sure to view the decision throught the prism of my job as Lead Aggregator.
That’s one of the cool things about the Internet Age, Steve. It’s gotten much easier for brokers to cultivate, grow and control the flow of leads into the office.
Just re-reading this . . . Steve Vincent – you are one sharp cookie. You’re talking about the BIG transition Help-U-Sell brokers make as they grow, from deal do-er to lead generator/aggregator. Once the office is humming along, getting listings and generating leads, it iw that last function, generating leads, that becomes the Broker’s prime directive. And how do you generate more leads? You get more listings.