If you don't mind, I'd love to hear some input and perspective from you. I have a number of decisions on my mind with our company, and I would welcome any helpful advice/direction. Please note that I said "helpful". :) I'm editing this opening paragraph now that I've finished writing the rest of the post and I realize that some of the stuff I wrote below seems a little disjointed. Hang in there if you can.
Here's the thing: I've been selling homes full-time in Austin for 15 years as of this month. I started my own brokerage just over 7 years ago. We've had some very good years (thankfully, 2011 was one of them) and a couple of very lean years, too. As we begin another year, my business partner and I are evaluating things to try to determine the best direction for ourselves and our company. I find myself going back and forth between two extremes: big-time company growth vs. streamlining, saving money, and focusing on my own sales.
We're paying way too much for office space, so we're likely moving down the hall to a smaller, much less expensive space. Most of our agents work from home, so it seems silly to pay for a large space with lots of barely-used desks. This downsize in physical office space will save us $1700/month, so that's a no-brainer. We will be moving.
I could use some of the savings for additional marketing/branding, I suppose. Again, I'd have to think about the most effective use of these dollars. I've used just about every type of print and internet marketing technique over the years, and it seems that the internet is the only one that makes much sense, outside of handwritten notes (not a joke). Again, I welcome your input.
We have a nice system in place for the leads from our website, and a relatively substantial number of new prospective buyers sign up every day. I would love to increase our conversion rate for these leads, since I worked so hard to get the traffic in the first place. It seems that this would probably entail more accountability, and a different system, although I have no idea how much this might cost to design and implement. I could focus on SEO, but since we're getting ample traffic, perhaps the site needs a re-design to maximize its effectiveness? Here's our primary website: http://www.austintexashomes.com
I DO offer something that seems to be in short supply based on my conversations with agents: I care. I genuinely care about the people who work for us, and I am available pretty much any time to answer questions or provide advice. I've never been involved in a lawsuit or mediation of any kind, because we really try to head off problems before they grow into full-fledged legal issues. I value honesty and integrity, which might be a hindrance to substantial growth, although I'd like to think otherwise. Maybe I'm not cut-throat enough, and I'm okay with that.
There's no easy way to say this next part, so I guess I'll just be blunt. I promise it's not sour grapes, just an observation. I have seen other local companies grow to 50 agents and beyond with seemingly less to offer, other than possibly bravado and aggressiveness on the part of the managing broker/owner. I don't begrudge them their success, and I'm sure I could learn something from their recruiting efforts. Having interviewed a few agents who went to work elsewhere, only to be disillusioned, I just can't bring myself to over-promise to agents. Yes, we have leads. No, I can't tell you how many to expect, nor do I want agents who are dependent on me or the company to produce all or most of their business.
I haven't instituted minimum production standards for our agents, partly because it struck me as disingenous, since I wouldn't have been given a chance with my original mentor/broker if these were in place, but I think I was a great addition to his team for 8 years. It reminds me of the classified ads I used to see for Dell Computers that required a college degree and 2-4 years of experience, when the CEO was a college dropout. That being said, I don't think I want very many brand-new agents, partly because of the time commitment involved in training. What are your thoughts on minimum standards for sales production?
I've managed up to 20 agents in the past, and I think I could handle a lot more (40-50+), under the right circumstances. Namely, if I weren't so dependent on my own sales to provide the vast majority of my income, and if the agents were at least somewhat self-sufficient. I recognize that this sounds obvious.
I guess the bottom line is that I am torn between building an actual business that can provide income for me on its own vs. continuing to grow my personal sales. I am now 41 years old. I don't think I want to drive people around showing houses (even if they're nice houses) when I am 60 or 70.
I need a plan.
Feel free to chime in below with ideas. I'm all ears.
Thanks for reading!
Photo credit:Joe Shlabotnik via Flickr.com Creative Commons license
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If you're looking for a home in the Austin area, you can also visit my primary Austin real estate website at www.austintexashomes.com. If you're interested in social media training, visit 210 Consulting. Thanks!
Hi Jason. So are you looking at ideas and suggestions to get more agents? To expand your office? I think a huge factor for new agents is to offer signage for agents. Maybe they just pay for their riders that have their names on it but the sign itself - all your office info/phone/website.
What about hosting real estate classes in your office? THat could get new agents.
LaNita - We have provided all signs and lockboxes from the beginning, and we don't charge desk fees. We have a competitive split as well. I pay 80/20 on business the agents generate, and 60/40 on stuff we give them. We cap the 80/20 part when we have made $15,000 as a company. It's 100% after that, until the new year starts.
I have considered hosting or teaching classes, but I have a feeling that it would only attract brand-new agents.
Jason, I do think your idea of limiting your overhead with office space is a very good one. So many of ALL of us are working virtual these days and meeting clients in coffee shops or out in the field, too large an office presence costs way too much. I look forward to seeing all these ideas sent your way. Caring definitely sets you apart from the others.
Thanks Gary! I agree - I rarely meet clients at my office, although it happens on occasion. I just think it's a huge sunk cost to maintain a big office. I hope to get some ideas/direction here, but either way, I will be moving forward with some new ideas this year. :)
Work on providing agents with positive, action packed info on how to get more business. Do hands on with Facebook business page set up and teach agents to use videos just some ideas. Agents are scared about how fast real estate style is changing. Help them.
Bud & Beth - Good stuff. Thanks!
Jason - I wish there was a broker like you in Connecticut! I'd be working for you. The brokers around here aren't making money, they just are getting swallowed up by bigger brokers. I'm not a broker and I don't know your market, but keeping expenses down and have fewer, but more productive, higher experienced agents seems to be a better way to go. You don't want to spend too much time handholding or dealing with potential litigation issues caused by inexperienced agents. Getting your agents to support one another by showing up at Broker Opens and helping one another out could be a differentiating factor. As an agent I feel like I have to choose between impersonal large firms or very small firms where the broker competes against you. I've yet to find a mid-sized boutique firm with a supportive atmosphere where agents help one another out and the broker is available to help you. That would be ideal from an agent perspective and might enable you to get more productivity from your agents.
Gail - Your comment is supremely valuable, and I really appreciate what you said. This gives me some good food for thought. I like the idea of a mid-sized boutique brokerage atmosphere. Thank you!
Jason, thanks for taking the time to share your thought process and some of the challenges faced by a small to medium sized broker today. It is important to evaluate EVERYTHING... I've found that it's easy to simply keep on going without taking the time to evaluate if a marketing program is continuing to yeild results especially when it's a 'sacred cow' which was once the best, latest and greatest gadget.
With regards to the challenge of figuring out if to focus on your personal production or on training agents...that can be a tough one. Many agents don't fully appreciate the benefits of a good training broker ; one who would likely be making much more money if they simply focused on their own business. I think you have to evaluate that decision based on what you think your calling is. If you need to make more money, it's not likely to be found in the managing broker business especially if it involves extensive training of agents. However, the industry needs this type of broker today, more than ever IMHO.
Lola - First, great to see you! Next, I really appreciate your perspective. I agree that more and better training is needed in our industry (as evidenced by the deals I've done with under-trained and badly trained agents over the years). I would certainly prefer to maintain the level of income I had in 2011, but I have a feeling I would need a LOT of agents to do this without selling on my own. I've been a sort of hybrid broker to this point - I train and support the agents, but I am still the most productive salesperson. I don't "compete" with them, but I have a bigger network and years of past clients to draw from.
One of the biggest reasons I left a brokerage and went on my own was the lack of help. My splits and cap rates were very similar to what you have above. It got to the point that I would have questions or concerns over a file but when I would ask my broker he wouldn't really say much. It was almost as if he was bothered by the hurdles I had at the time. I also became aware of how much business he was giving to a few select agents. With that being said I jumped ship and went on my own.
Long story short the fact that you care will help you retain who you have and they should be telling others about the fabulous broker they have. Your brokerage will grow and you'll have the quality agents you deserve. Too bad you don't have a branch in Utah ;)
Jason, good to see your post here on AR. Let's see been there done that on the reduction in office space. Actually two offices to one very small one. I agree I wont accept any new agents just to much time involved. In my mind more than 10 agents would be pushing it. I just like to do my own thing. Just my business and no real worries other than complication from the sale.
I to wont be driving around people when I'm 60 or 70 but I do enjoy the business so who knows on that one. With the systems in place our business can continue on their own with little effort.
I don't see a reason you can't do both. I think it will take a while to build a brokerage to be your only source of income, and 41 is young! You have over 20 years before retirement. I don't like putting all my eggs in one basket...and relying on others. I think you could make this a long term plan over the next 10 years.
Jason, we sized our office down a few years ago and have been thinking of expanding to entice new realtors. But we decided it was not the right time. Improving the looks of the office is what we opted to do. I'm looking for real estate agents that want to run a business and not something temporary until they find something better.
Hry Jason, good to see you on AR! And congrats on a good year in 2011! Your questions are tough ones, and I have enjoyed reading the comments. If you like the idea of teaching, is there a way to weave that part of the business into its own revenue source for agents/brokers in the area? And maybe this becomes another way to grow your business? Best of success to you and your team in 2012!
That's a lot of questions in one post. You are truly trying to define your next steps. It's questions that any Realtor or Broker comes to at some point in their career I suppose. I'm not sure that I can lend you any advice, but you sound like you are a caring broker that would be well worth working for.
Jason, where is your passion? If it's mentoring and training others, taking a cut of that to earn your living, then pursue that. If it's about connecting one-on-one with clients, then put your energy there. I think sometimes, where we are in our lives overall (age, family dynamics, etc) has a bearing on what makes the most sense. Once upon a time, I managed others in a corporate setting. But now, I don't want than responsibility. I just want to worry about me, without feeling the burden of having others dependent upon me. REALLY look at passion - it's what gets you through when challenges come your way.
You are talking about the business model. I would factor in the family, fun model. If you are a day care for other agents, if it distracts from your enjoyment of being on the front line with customers, you could decide to "work for yourself". Small overhead, heck hanging a shingle at another agency and just do real estate. Carve out a niche or two, create on line "offices" for the different streams and specialize in the type of real estate you enjoy. If you worry so much about expenses, you are a CPA not a REALTOR. Some doctors like to do surgery, not paperwork and just want to be in the OR. Get out in the field, list and sell. Less liability when it is you not a new agent that is learning at your expense. And jumps ship because he thinks you are making a fortune. Has no idea of the worries.
Jason: I am going to park here for awhile because I want to read through your post and comments very carefully. I am thinking about a sole propriertorship so that I can sell in another market area (an area where I grew up) even though I will be living in my current market area and have no desire to leave whatsoever. But because I am back and forth between both markets and own a home in each market area, I feel it's time to expand a bit. Eventually, I might even want just a couple of established agents but that would be it for me. So, I plan to get some tips and ideas from your post and those who comment. I know you have been highly successful and there is plenty I can learn from you. I wish you nothing but great success in all levels of your life and business.
Hi Jason - Your comment about new agents was telling. I had my own real estate agency for 30 years. I didn't hire part timers and I rarely took in "used" agents. I recruited new people who had never been in real estate but had a successful background. I have had multiple offices with dozens of agents. Smaller is better and more rewarding. It is also more profitable. Hiring agents just because they fog up a mirror is useless. Good luck.
Jason:
After reading this post, I feel like the struggle you are portraying is a fight within you between the wonderful working broker and person you are vs. the type of working broker you think you should be, based on how you see others in the field conducting their business.
But I think you should embrace the unique person and employer you have become. Because what you offer is very rare, indeed.
My initial thoughts ...
The first thing you should do in the new year is hire better agents than me! =)
In all seriousness though, I remember interviewing with you while I was still taking my classes back in 2008/2009 and being very impressed with you as a person and as a broker. I think somebody who spends even five minutes with you will know that you are a sincere and caring person. I found your blog when I was researching real estate sales soon after moving to the area and immediately felt like I knew you.
I interviewed with 16 brokers before beginning my career at Keller Williams. I will tell you now that the main reason I didn't sign up with you as soon as I got my license is that your office seemed to be designed for veteran agents (which it sounds like you intend it to be), and although I had years of experience in real estate before I got my sales license, it was in a completely different area (development/building) and I really wanted to immerse myself in a larger office that offered real estate sales classes. (I may be in the minority here, but I am anal-retentive when it comes to law and contracts and wanted to make sure I was solid in that area before coming to a boutique brokerage)
It was always my intent to sign up with you when the time was right.
One of the things I find most refreshing about you is that you are not a typical, smarmy, pushy, disingenuous/insincere broker-agent. You have provided many solid leads, too, since I came aboard. I've always felt like you are there to talk if needed. In many ways I feel like I've let you down because I haven't turned as many of your leads into paychecks as I should.
But I have been in the business world for years, and have learned many things through trial and error when leading people, and I hope some of my insight is helpful to you.
In a nutshell, I recommend considering a few of my favorite things for 2012:
Remember, you are in an enviable position that allows you to make life what you want it to be. I wish you the best in 2012 and beyond.
Jason, it is really simple. you need to follow your heart. How much do you like helping clients directly? If you had 40 agents instead of 20 and didn't do any private business...would you miss that part of the business.
I am not a fan of bigger is better. I am staying small. I will this spring bring my agent staff up to 5. That is plenty for my area and enough for me to handle without cutting into my "PERSONAL TIME" with family.
Just a thought! I know how important your family is to you.ll
Jason - systems systems systems and you can always handle so much biz! I became a broker for an existing biz in 2011 and let me tell you - these systems are streamlined to the point where I don't feel like I am putting enough effort in to earn my salary.
We rent an executive suite - share resources with another brokerage and our overhead is minimal. All I do is spend maybe 1 hour a day answering agent questions and auditing files and that is managing 30 some agents.
I would say - get into an executive suite, streamline your brokerage biz, put your files in the cloud (if TX allows - we use vtiger) and let everyone else make money for you!
Jason, I tried to answer but my long-winded self kicked in, so rather than take up your post, I emailed you the comment instead.
:)
Jason, I think you have to follow your heart. My company JUST turned 2 this week. I has been a love/hate relationship until a few months ago. I struggled with WHY I was doing it.
Initially, I opened to save paying the hunks of dough each month to Re/Max. I had no intentions of ever having more than 1, maybe 2, agents join. We began to grow organically and that is when my struggle began. I was so flattered that agents wanted to join but SO frustrated with them because they didn't share my vision or core values.
I was at a retreat in late fall of 2010 when it hit me...I don't have to work with agents that don't see and share my core values, because I OWN it. I CAN demand better. Once I figured that out, I came home and asked the 3 that didn't fit to move their licenses. The sky parted and the angels sang that day.
I am now on a full blown Raise The Bar in our industry binge and going after it full throttle. We are up to 9 agents, squeezed in like sardines and expanding our office to an open floor plan, going from an "I" environment, to a "WE".
I've spent a lot of money traveling, learning and surrounding myself around those that I admire, learn from and that I feel enable me to be a better me.
Go with your gut. If you do decide to go big, you'll have to go full throttle. You'll have to be there to coach your agents, lead them and guide them when needed.
The difference between us is, my last child JUST graduated high school last month. I don't have an entire family counting on me. If you feel confident and have the staying power, go for it. You must believe in your vision and be able to find others that have the same beliefs, while having the strength to let go of those that don't.
You can do this, if you believe you can. I would talk to your wife and partner, and go for it, whichever it may be. Build the best damn company Texas has ever seen :)
After reading all the comments I don't think you need my input Jason. I think you have plenty of food for thought here. I particularly like Renee's comment about systems. I hear you as far as converting more of the traffic to your site. I'm in the same boat myself. I get quite a bit of business through my online efforts, but I know I could do better. Renee is right, I'm working on those systems now.
Jason: I will email you the system that my broker uses in his/our office. It seems to be working very well. If what works for you would be something that could increase your bottom line, and at the same time free up more of your time to follow other pursuits... perhaps this model may be of interest to you.
PS... rather than me sending it to your office email, does your "cowboy" email still work ?
I admire your stance about not holding minimum standards (as that wouldn't have allowed you to flourish, when you were hired) and not hiring many "new" agents.
Personally, I'd go the other way... I'd suggest that you should set the bar and expect minimum standards... tied into splits. It gives the agents a goal.. incentive to do better... the more they bring in, the higher they'll earn. For example: 80/20 on the business the agents generate, unless they produce less than (I don't know what a good "less than" is for your market), and then it becomes 75/25, or 70/30... you get the idea.
And I would recommend accepting newer agents on a one-to-one basis... interview them carefully and accept only those who seem hungry, and motivated... if my manager had not done that... she would have missed out on ME, and I have proven to be among the top producers in our office, year after year, after year. (including my very first year).
Growing pains suck, don't they?
If the office is small and still growing, continue to be a working broker. If the office provides you enough income and sustains you, then focus on managing, training, implementing systems, etc.
Oh, I've been thinking about similar issues w/ my company. I agree w/ the advice above to figure out what you love and move towards that.
In terms of immediate thoughts on where to reinvest, my first 2 areas (which might be interrelated) would be 1) grow your repeat/referral biz and 2) get a better CRM tool...so that you can better follow up w/ past customers and pending. Do whatever needs to happen to grow repeat/referral, even if that means hiring a part time asst to help.
Hi Jason! What a wonderfully, raw post that has certainly opened the door for some great comments. (And, give Aaron a hug for me...I heart that guy! What a wonderful comment, and so very true.)
Oddly enough, our concept of building a strong boutique business is incredibly similar. Here's where you seperate yourself from the big boxes, adding 50+ agents is NOT the answer unless you and your partner can be the same reliable resource that you are now for all of your agents. There are a couple of those big box firms here that we joke about agents who go there...we call it the graveyard; such a huge percentage of them leaves the business after a very short amount of time. The reason? No support.
You can provide that same support to new agents--just like the old ones. What are the new agents' backgrounds? Were they a top sales person for a pharmaceutical company? If so, just because they're new in our business doesn't mean that they can't hit the ground running. Don't discount them because, on the other hand, if you bring in an older agent who is struggling, some of them can be tougher to get back into the swing of things than the newbies. (Plus newbies are so energetic and will almost always DO what you suggest to them!)
A strong mentoring program is also an idea to help you grow your business. Offer some of your successful agents 5% more on their side of the split for taking a newbie under their wings for 6 months. Most companies offer no form of compensation for that but, if you look at it from the company's perspective, it's a wise investment in your future! This also frees YOU and your partner up to do more recruiting.
As for the locale--I love our office but, like you, rarely bring a client there. Starbucks is more my office than my own office (which is sort of sad but, seems to be the way of the world these days!). Definitely make that move down the hall, whether you expand or not, it's a smart move.
Who is working your leads? If they're paid hourly, consider incentivizing that position--your agents will get more solid prospects, rather than just leads, I promise!!
I would definitely follow your passion and your heart, set a plan and work from that plan. Yes, plans need to be tweaked--and some years, more often than others but, work from it nonetheless.
I also agree with Aaron about meeting with a couple of other like-minded people across the country. I've done that religiously over the past year and I can tell you, it helps tremendously. Chatting on FB or even here, so many are concerned about the competition stealing your ideas but, when you Skype for an hour (designated time) each week with others in the same situation as you, you just won't BELIEVE how much you learn and how quickly you can implement ideas learning from each other.
BEST to you in 2012, Jason! I would be happy to partner up with you to have a stellar 2012 together!
Jason,
I started with Coldwell Banker when I first got my license because of the training I received. That was important for me since I was new to the business. I was only there three months when I was recruited to join the team I have currently been with since 2005. We, too, had our own office that was 15 minutes from my house and I never went there. My team officed out of their home half a mile away and I sent there to fax, drop off paperwork etc.
They took a chance on me but saw a lot of things in me that were important to them. I was a former college athlete so competitiveness and hard work are in my blood. They have also taken chances on similar agents who have been asked to leave for lack of production. I actually like goals but maybe if you allow each agent to set their own and help them to reach those goals.
I recently renegotiated my commission split because I felt it wasn't "fair" for me to have the same commission split as new agents so I now have one similar to yours. My boss, like you, cares and will do what he can to help us succeed.
I realize that this doesn't help you with your questions but here's a thought...since so many people telecommute, why not set yourself apart from the competition with offering a technology package? Maybe you set each new agent with a laptop, iPad and put them on your "family plan" with their smart phone? Pay for their AR membership? What if you could do this instead of an office? Set agents up for success!
Hey Jason,
My personal belief is the economy and housing market still has not fully bottomed out yet. That said, If I were you, I'd enjoy my cash on hand and SAVE IT. I'd also continue streamlining and finding ways to save money. Size isn't important! Then again, some of the most successful companies were built in down times. You have a family so "risking" isn't as easy to do. I personally feel the need to be lean and more consciouses about money spent.
Good luck and congrats on the feature!
Jason, do you want to be a manager, or a selling/listing broker? Whatever you love more, do that.
Jason,
I wish I lived in Austin! I'd be calling you to meet up for a cup of coffee and to discuss this whole issue with you.
I've just started in real estate, coming from a financial planning background. The one thing that I think would be most valuable is to have a documented system. In it you are basically describing in detail the process that you see as being most successful in your business model. It's the formula that makes your brokerage unique and sets you apart from the competition. It tells your agents exactly what steps to follow in every facet of the business and is a guide to top-notch performance.
I know that this is not normally done for two reasons. People are afraid it will be "stolen" by the competition and it's a lot of work. In any case, I just thought I'd throw the idea out there for consideration.
All the best.
Jason: I hope you get useful feedback in your quest. I'll share my thoughts and hope that they some make sense to you. This really isn't the forum to share what I think but I'll do my best.
I have been truly blessed to have worked for 4 great companies in my life: Xerox, Pansophic Systems, Arthur Andersen/Anderson Consulting and now Baird&Warner. And despite the casual slams at big box firms, I have received and given so much of value. I am always so surprised by people who say that they just got training at a big company and then moved on. When you do well and work with great people, you and the firm can grow together. Bit you have a chance to replicate this magic when you start on your own.
Does "stewardship" have meaning (as a word) to you? It means that the company and the individuals had a responsibility to create and maintain something of lasting value. It means working not just for the next check, or for a place on the sales board, but for the next decade and beyond. It embraces having fundamental grounding in family and community.
In real estate, I don't believe that a managing broker can or should list and sell. For one thing, there are always raised eyebrows about the best leads. A good manager and leader should be focused on developing his/her people and their business. In a small firm, this will include lead generation for your agents....but I have to say, other than some relo referrals I have never gotten leads frm my broker....we expect our agents to develop and run their own businesses. I do use my broker for counseling and advice....usually license law issues these days, but originally it was all about getting my business up and running. We had 2 managing brokers for about 100 agents in or office when I started, and neither of them list and sold. Now we have a managing broker and a training manager, because we have what one outside consultant called a "self-managing" office....the top producers resource each other and call on the broker only when necessary. Oue broker spends time on admin, hiring. some training (and she's a pre license and broker trainer).
I don't think it's fair to yourself, your family, your agents or your business to spread yourself too thin. No one can possibly do all the lead gen, all the recruiting and training and coaching, and list and sell.
Austin is a healthy market, I hear. I'm not sure when you'll be able to make the transition, but you will hit a point where you either need to grow with the market (which means running the business not listing and selling) or hold tight for a while and even retract a little.
I know you're praying on this, so I hope you are hearing answers that are the true guide. Maybe the rest of us are called on to comment on your post to make us think this out and ask for guidance....the daily struggle for me is to shut up and listen. So I'll do that tonight, and if I hear anything useful I'll pass it on.
Thanks for sharing, and if you read what must be my longest comment ever, thanks for reading it.
Wow! So many good comments here already. THANK YOU for taking the time to leave remarks on this one. I hope to address each comment individually, but for now, I wanted to simply say, "Thanks."
KAREN ANNE - Yes, that email is actually the very best for me, since it's a Gmail account. Thanks!
You have gotten great advice here, as I knew you would. At some point, if you want to gradually get out of direct sales, then growing a boutique business is a great idea. I always say I will never change brokerages because I have an awesome managing broker and wonderful support, BUT if you were in my market, I would totally love the opportunity to work for you. You are that respected and that unique.
When I first started, I could not even get an interview with the office where I wanted to be, but went on my first year (new in town, could not get to the grocery store without GPS) to be rookie of the year of the office that did deign to hire me. My background of more than 20 years in marketing and advertising served me very well...having no experience in real estate but with plenty of support from my broker, I have been successful. I think the decision to hire inexperienced agents or establish a minimum production level can be made on a case by case basis..there are new agents with no clue and there are new agents who can bring a lot to the table, depending on their level of experience and ability to understand they are really running a small business.
Each of us is at a different stage of life, so our advice is going to have to be filtered with that in mind...you have a young family, which is a huge factor and your first priority. You are also an entrepreneur who is getting to an age where the future looms and you even start to think about retirement one day. I agree 100% with everyone who has said follow your heart and your passion, because that insures success more than anything else. Start there and then work backwards to see how to get there.
Oh, one last thing...our commission split is based on how much we earn...the more we sell, the more we make. Although I am very self motivated, that sliding scale really gets me motivated to do more!!
Jason, you've gotten so many good comments above and I really don't have anything to add to it.. except you're growing and if you continue on the path that's been working for your, there will probably be that point where you stop focusing on your own sales because your company has reached that critical mass level to provide enough income for you with you managing your agents.
Jason-
My firm is 12 years old and has 25 agents. I am still the bulk of production, but the ratio is changing. Our USP is, quite frankly, me.
You and I are VERY similar aside from the fact that you are about a foot and half taller than I am and I talk funny.
My plan is to grow the firm for the reasons stated- I would rather have 1% of 100 people's efforts than 100% of my own. I'm not chauffeuring people when I am 50 unless it is for fun. My best recruiting tool is my people- and my blog.
If it weren't late I'd call you. I have RE Barcamp tomorrow, but we should talk. But I will say this: you have 100% of the really important things, and that starts with that you are Jason Crouch.
I have a small firm and last year it got smaller. I let go of the non productive agents. I can tell you that I also have that split focus. So What I did was build my own brick and mortor office. I'm trying to build a business that at a point in about 18 years that I can sell. Even if I am not selling the "real estate" business it's a great location. I am also focused on my own sales. In past years I was focused on growing the business and getting leads for my entire office. Turns out sometimes those agents don't really appreciate it or take you give them and move on with it... so I'm all for minimums and agents who bring something to the party.
Jason - Have you thought that both can be achieved and you still dont have to show houses at 60? I finally realized that there's only so much I can do rather than when I grow in numbers. That's where I'm headed slowly. But I want to grow not just in shear numbers but to carefully select agents that carry the business name proudly, respectfully and productively.
When selected carefully, you dont have to grow in numbers, in just a handful, you're able to produce in far better ways than if you just hire any licensees. Just writing contracts freak me out.
Then, decide on your financial independence numbers. Get to a goal where you become debt free, have 2-3 years of income, and you can slowly transition to just be a broker and refer all business out. That's my plan.
I've been praying over this scripture the Lord has set on my heart,
Matthew 9:37, "The harvest is plentiful but the workers are few".
Carefully select your agents, grow with them. Even the Lord said business is plenty and the opportunity is everywhere.
Loreena in #45: The Lord may have said that, but how many Short Sales has He done ?
Is He sharp enough to deal with Bank of America ? Does he have the SFA or the CDPE ? How 'bout the CRS ? One thing I DO know, is that He is the Neighborhood Expert, though. <dorky grin>
I'm sorry but I'm not sure what you're saying.
Jason, It appears that you have the skills and experience to be a super-sales person in your market. Do the math and keep the agents that are paying for the space they are occupying and suggest that the others either step-up or move to a franchise where they will get the training and become better agents, but not at your expense. Offer higher compensation to the best agents and you may see a better bottom line.
Good post. I think Loreena has a good point. As I "push" toward 60, I'm still showing a few houses, but only the ones I want to. I have built a great referral business and still give each client my best. But, what has allowed me to be picky is the planning my husband and I put into it. Everything paid off, money in savings, always living below our means. I am amazed at how much power that has put into my life. It wasn't always easy and no, I don't drive the nicest, most expensive car (even though I could afford to), but I don't have commisison fever and if a deal doesn't turn out, it's not the end of the world. Good luck. Austin is a great market and I'm sure you will do well.
Jason, I am not a Realtor. I read these truly helpful comments from your fellow AR agents. If fellow home inspectors were only as helpful, it would be nice. I suggest printing and keeping their advice handy to read and re-read.
Your market seems to be one of the best in TX and the country. Is that correct? In that case, you may not have as many short sales as say, Atlanta. If you do have short sale listings, I might try to recruit an expert on short sales to add to your staff. Several of my referring agents are successful in that niche. Good luck!
Jason, Stay the course, fly the plane! In business changes are always necessary to keep up with agents and customer needs. Make minor changes as you go that make sense financially. Hold classes, don't hold classes try it! I have been self-employed most of my adult life and I have learned a lot along the way... if itain't broke don't fix it is one of my favorites. but if it is "broke"you need to pull out everything in your arsenal and open your mind to new possibilities every day!
Offices - it sounds like you have taken space in an office building. As you're considering alternatives, have you thought about taking ground floor retail space in a high traffic area? This can help tremendously not only with lead generation but also recruitment.
Manager vs. Servicing Agent - Would it make sense to hire a branch manager to be solely respsonsible for recruiting, training, and managing? Tie their compensation directly to the office's performance then focus on your own clients and "managing the manager." If this is done correctly, you will have an office producing substantial passive income by the time you don't want to be working with clients anymore.
Recruiting - Do you have a serious plan for this? Have you considered making a list of 100 agents in your market that you would like to work for you? Once you have it, go about setting lunches/drinks with two of them per week. Within a year, you've sat down with the 100 agents you want and talked to them as the broker/owner of your company. I'm not a big fan of hiring new licencees unless you're one of the huge firms with training programs and managers in place who are OK with high attrition.
Jason - one thing I can tell you is that having gone from big box broker to another big box broker when I moved to Austin, I was probably an idiot to not have come to work with you. :-) That being said, I can see how it would be difficult to get agents to come to a smaller boutique office rather than a large one. They have recruiters and the promises of great training. Had I been a new agent in the position I'm in right now, I doubt I would have been an agent for long though. It's easy to get lost in the shuffle of 150+ agents... Fortunately I have a long list of business and know what it takes to survive in the real estate world. My goals are to survive living in a new area for the duration of my husbands contract and in the meantime complete my classes for my brokerage office. I doubt I will have any affiliation with any big box franchises at that time because the reality is they cost the broker and the agents too much money and do little in return (IMHO). My focus will be to bring in new agents and mentor them. I think that for you with your caring nature and all the knowledge you have to share with them as well as being readily available - even after you have a new agent trained, I think they will not want to venture out on their own. One thing I know is that had even one broker really invested time and effort into me, I most likely would not be even considering going out on my own -- reason being is because they had given me something of value. I think agents that work for you are just like our clients - very few care about a big name, our awesome marketing - they care about how they are treated. I doubt you have a high turnover when you are able to bring in agents when they feel truly cared about and know they have someone to turn to.
All that being said, my plans are to continue my internet efforts so that I do have leads to give to new agents. One other thing I am hoping to be able to establish is websites within my website. In the area that I specialize, I have seen that most agents don't even have a website because it is too daunting to them. With me providing a website that branches off my site, I can teach them to blog for business, all the while giving more strength to my own site as well as having a great agent retention tool.
Hi Jason--I own the RE/MAX agency in Green Valley AZ. Was in the right place at the right time when the previous broker went under. At the time I was only one year into my RE license but took the plunge. The first and most obvious step I took was to move out of the 8,000 sq ft. office space into 1,400. There are 10 agents in the office--2 of the 10 are in the top 5 for the community and there are total of 4 to 5 (varies slightly by year) in the top 10 agents. Yes, I could grow the business but decided that growth for growth sake is not what i want. My goal is to keep it a lean, streamlined selling machine.
Hello Austin Dude....i meant Jason
im not near at any level to give you any suggestion at all.
i was overwhelmed myself just read your whole blog.
so like yours, I am all ears
thanks for sharing
best today and 12
onward
jimmy phan
I have not read all the comments, preferring just to add my two pennies.
Which do you love to do most, selling or managing? If managing, there's your answer. i was once told and I do believe..agents stay with a broker because of who he/she is and what they do for the agent, not because of a name, brand or commission split.
If you love selling more, why not build a team of buyer agents and be team leader. Become the rain maker.
If you love listing do that and hire buyer agents.
Follow your heart Jason, be honest with yourself. I am also an independent owner of 4 years. I love buyers, that's where I focus.
I am dumping my office completely this year. Out of all my buyer clients only two wanted to meet at the office, the rest we go to coffee shops etc. Losing two clients would be worth the cost savings for the bricks and mortar. so I will be 100% virtual in May.
Good luck!
I read every single comment and I appreciate all of the information. Very useful I might add! Good Luck this year.
You certainly received some great feedback from many agents. Its a great idea to solicit feedback from this community as they are always willing to share their thoughts with you. I personally like that Aaron chimed in here. He had some great feedback, and that is coming from someone that works within your office. He shared how he felt when he interviewed with you and how the office made him feel. I also think its a great idea to meet with Like Minded individuals within the industry. Perhaps there are some things they will share with you directly that they may not be willing to share on Activerain.
I Also agreed with Loreena (and perhaps a few others said it as well) that you should continue focusing on your personal sales AND growing your business. Sure, you may not want to drive people around at 60+ but you do want to have the cash flow to retire. Personal Growth and Business Development are both needed.
New agents have to start somewhee! Everyone was new when they first started!
I have been on my own for 20+ years, regardless of what direction you choose I would work toward being on your own.
Jason have you considered changing your own personal niche to very high end homes or commercial. Something with a bigger payoff in the end. You seem to have the experience to do something like that. Basically cherry pick your personal business to get the best return on your work.
Hi Jason, You may not want to hear this, but give Gary Keller a call and listen with open ears. Tell him I sent you!
Jason, don't change your website if it's working. Play with building another one instead. Can you do door knocking in your area? Also, the LA Times still works in very specific areas. Maybe you could add print for certain areas. It's still good exposure depending on your needs. Happy 2012. Kristine
Jason, You received some very thought provoking comments. You've a great deal more experience in real estate than me so I'll just think about some of these answers myself.
Jason, by the time you are 60, you will have some fine, formerly-homeschooled agents on board that will take your business to the next level!! ;)
Jason, based on your blog post my gut tells me you love building a business but find being a "working broker" pulling you in too many directions. Like others have said, focus is key. I don't think you'd still be producing so much if that wasn't your passion, aside from the "driving people around when I'm 80" bit. Well there's a solution to that and I'm sure you've already come across it many times. Comments from others mention building teams, hiring buyers agents, being "the rainmaker". Another agent mentioned Gary Keller...I wasn't going to mention KW and Gary but someone already did, so oh well! I mean, you're in Austin. You're dynamic. And the most dynamic brokerage and most dynamic real estate model in the country (the world?) is based in your back yard. If you haven't already read MREA. About the levels of building a team, etc. You can build the business however you want, hang a KW sign, succeed through others and hang out with some Very Fine People! And you can bring your current agents into the company and retain some passive income through profit share. Join the Associate Leadership Council and give back some of yourself. You might want to puke right now reading this - if so, I'd like to know why! For my own personal enlightenment. Obviously I'm totally sold on the business model and culture of the KW culture and yes I'm a KW agent. Cheers.
Jason
I have watched you grow here on Active Rain and excel with your tech skills. Seems to me that maybe there is a way to attract more agents that don't require an office utilizing what you are so good at. I feel you have done that to some degree, but honestly given a choice I think most agents would rather have minimal office space or stay at home with super tech support. There is some advantage in growing your numbers. Just think if your firm netted only 50 dollars a month from 200 agents that is 10,000 a month net. Not a bad salary plus you get to sell too. Wt[th your skills and a good staff team,, it might work!
Thanks for posting Jason, I have been reading your blog for a bit and you post some good stuff.
Here's what I am thinking...We advertise at all the Cowboy games. Of course we would have to attend them in order to make sure the advertising is working.
You are my favorite Broker and Great Friend. Thanks for all you do.
Alan - Seems like a solid plan to me. :)