Here are the five main pillars behind running a sustainable brokerage. Drop one of these, and you risk failure.
When we look at the real estate brokerage business, we see many different models. Ultimately, their survival is determined by how well they operate and their resulting bottom lines.
Although some might focus on recruiting and others might be top-producer driven, the most successful ones have one thing in common: They keep all the important balls in the air consistently. In other words, they practice complete brokerage management.
To have a brokerage that performs consistently, you have to be consistent with these five principles.
Although bringing in top producers is nice, it’s important to recruit across the spectrum. You need to be sure to include new agents, mid-level agents and, yes, top producers.
All top producers were once new agents and the office will get the most out of good, steady mid-level agents with reasonable splits.
As you are bringing in a nice steady stream of people who fit your office culture, it’s important to give them a path to success.
Providing consistent and practical training in the office is key to making sure that you see a return on the new agents that you bring on.
Getting agents producing in 60 days or less should be your goal. An active, fun, forward-moving office is so important to creating a culture of productivity.
Regularly communicating with your entire agent base regardless of production level will really help in keeping everyone involved and engaged.
Give your agents everything that they need to be happy and productive. At the same time, don’t forget to let them know what you need, which is more transactions.
Make your office an easy place to do business for your valued agents who really are your customers. Making sure that you have enough staff made up of the right people with the right skill sets will go a long way in making your agents comfortable and profitable.
Systems for processing deals and transaction management should be in place. Your office should be comfortable and efficient, and your agents should love being there.
The energy in your office or your office temperature has much to do with the income that it generates.
Happy agents who make money will also stay!
5. Expense management
Now that you are taking the money in, you want to keep it. Looking at the big drains on profit — such as salaries, supplies and advertising and keeping them streamlined is key to retaining the money coming in: Smart spending, not excessive cutting is best.
Not spending enough money could be just as bad as spending too much.
The biggest challenge in running a successful brokerage is time management. With so much going on and so many things happening on a daily basis, your success will depend on your discipline to spend most of your time on income-producing activities.
Managing your staff is so important here. When your day is continuously taken from you for non-income producing activities, your brokerage will fail. Just like agents, brokerage-owners and managers can get pulled into doing things with very little importance to the bottom line, and just like agents, this will result in making less money.
We often tend to work on things one at a time. We may focus on recruiting while letting retention activities slip, or we may be so occupied with training that we stop recruiting.
This behavior will result in a roller coaster effect on your brokerage’s numbers. We must keep all the balls in the air consistently and have fun doing it!
Being consistent with recruiting, training, retention, support and expense management will give you complete brokerage management and the steady growth and consistent bottom line that you are looking for.