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Putting Your Money Where Your Mouth Is

Blog Contributor Being a Broker, Business Challenges, Closing, Personal Fulfillment, Sales & Marketing 11 Comments

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Dave Robison

By Dave Robison

Have you ever received a letter after a closing from the other brokerage thanking you for the successful closing?   Have you been bombarded by e-mails stating that XYZ Brokerage has the best broker and systems to help you be successful?  There are literally hundreds of brokerages to choose from, and yet I feel they  say the same thing: higher splits, best service, etc., etc.

The question is, how do you really know XYZ Brokerage is going to help you more than ABC Brokerage?  Is it by the number of agents at the brokerage?  If the brokerage has hundreds of agents, maybe that is the place to go?  I have had a thought lately that if an agent wants to choose a brokerage that will help them succeed, it’s time to find a brokerage that is willing to put their money where their mouth is.

When I was a kid, I remember I wanted a Sports Illustrated subscription.  It was the cool magazine for kids to read.  I asked my mom and she said that if I practiced the piano a few times a week and did some other chores she would get me the magazine.  I got the magazine, but you know what…I never did any chores or practiced the piano.  I remember thinking, “Mom hasn’t even asked me if I did what I agreed to.”  I remember thinking she must not care, so I never did it but I still got the reward.  I occasionally think of that moment and the principles of accountability.  My mother never had a system of holding me accountable.  I was free to do what benefited me the most.  Since I wasn’t held accountable, I didn’t perform.

In building a real estate team, I learned that people perform if they are held accountable. When you are held accountable, you put your money where your mouth is. You perform or you don’t benefit.

I believe there is a brokerage of the future that would embrace this principles of accountability. Today, if a brokerage wants to grow profitability, they recruit an unlimited amount of agents.  They may promise to help you be more successful, however, they are free to recruit your competition to help them be profitable as well.  If we are to apply the principles of accountability to a brokerage, then it would be structured differently. Imagine a brokerage where they only had a limited amount of agents.  Let’s say 100 agents.  How would they grow profitability?  The only way they would grow is if their 100 agents continually sold more homes and were more successful. Now their focus is on you being more successful (not recruiting their fallback) because they are held accountable to it. I believe the broker/owners would innovate and personally grow from it. This is a brokerage that puts their money where their mouth is.

Are there any brokerages that you know of that do this? Is it a brokerage of the future?  Would you prefer to be with a brokerage of 1,000 agents doing three deals a year, or a brokerage of a limited amount of 100 agents who are all doing 50 deals or even a 100 each a year?  Who will put their money where their mouth is?

Dave Robison, known as “Utah Dave,” is a broker/owner of Robison & Company Real Estate.

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Comments 11

  1. Dave,

    Great question you raised. 100 agents doing 50 deals each is a powerful office and very profitable to all involved. We’re seeing some brokerages doing the opposite however in our area, larger groups of agents and lower per person productivity. Interested in hearing observations from others and in different parts of the country.

  2. Here is my opinion….Like everyone else I took fundamentals and passed my state exam. At that point I was in business. I decided to hang my license with the brokerage that tought me fundamentals. They sent me through a series of classes and said… I’ve armed and supplied you with education and tools for your success. What ‘You’ ‘DO’, with the education and tools is up to you. After all who’s business is it? The brokerages or yours?

    I look at this way… What will you be bringing to the table? What skills do you have and how can I assist you and give direction? Why should the brokerage allow you to hang your license? After all who’S butt is truly on the line. Who assumes most of the risk? Agents go out and do what they want, not truly understanding the laws and how they impact buyers and sellers.

    Personally I want a broker who knows and understands the laws, gives guidance and lpoks out for me and my clients. Everything else is your business expense. After all whos business is it? The brokerages or yours?

    It’s not what about what can you do for me but rahter ‘what can you donfor them? JMO

  3. Just read this article and it is a very interesting question. I think I’m with you Joe in being interested in hearing from others in different parts of the country. Kaaleen, not sure if I understand exactly how your are answering the question or what side you are choosing but I would ask, who’s business is it really.

    Starting out with a discount brokerage, it was definetly their company. No personal web site, no picture on business card and no innovation or creativity as to how to bring in business. The focus was on promoting the company and earning money for the company…and you’ll make some too.

    The next company was the average, hire as many agents as will come onboard, here are a few tools, now earn money but here are the rules and restrictions. So who’s business it is depends a lot on the brokerage.

    Personally, I love real estate and the business of selling and helping others and I operate as if it is my business, because it is not just the brokerage name on the line but mine as well.

    I hope other agents and brokers comment on this issue. I’m sure the discussion will be helpful to new and experienced agents. Got me thinking. Thanks Dave.

  4. So totally accurate. Accountability is becoming a lost quality. There are many fine, reputable Companies out there who hold their agents accountable, and the agents hold themselves accountable. So many agents today walk into the brokerage and say what are you going to do to make me successful. They don’t even think that their success is up to them. They are running a little business of their own under the “umbrella” of their broker. Most successful agents would prefer a smaller, more successful brokerage. They want to be surrounded by and associated with other successful agents. When our brokerages see that as a valuable asset, perhaps they will stop hiring on agents just to have big numbers of agents, because their perception is that big numbers make them more successful. But this is just breeding mediocrity, not success. Success breeds success.

  5. Great stuff Dave,

    I have been selling homes for 17 years. I started two successful real estate team framed brokerages in 2 states…Tennessee and Louisiana each of which always closed in excess of 120 homes per year. My focus is on building the real estate office of the future and putting my money where my mouth is.

    My Reason? Home owners call upon big brokerages because they feel as though they’re going to get the best odds of their home selling. We know that it’s all in the agent. Buyers call on houses, Sellers call on the image.

    This is why I feel the need to create a real estate firm with a systemized approach to each specific task for the entire real estate transaction. This in my opinion gives the client the absolute best service. Each person is a specialist. Bottom line it’s my planned brokerage with the following below closing 1,000 units per year!

    30 Home Buyer Specialists
    5 Listing Partners
    5 Closing Processors
    5 Listing Processors
    1 Sales Manager
    1 Office Mangaer
    1 Office Assistance
    2 Field Coordinators
    1 Marketing Manager

    This is my brokerage of the future!

  6. I believe in quality over quanity. When you have a small group of active REALTORS dealing with transactions on a continual bases, these agents stay sharp and in-tune with closing procedures. These agents know the current market and can likely better assist their buyers and sellers. An agent that only closes a few deals a year may not provide the knowledge, advise, and acuracy an active agent can produce.
    Located in Woodward, OK

  7. I completely agree with Tamra.
    In addition, I believe that smaller offices have less turn over, more broker & agent direct communication/allegence and less issues that could mar a company.
    Brokers with hundreds of agents face an almost impossible task of hoping that any agent faced with a questionable situation will approach them to discuss before making a decision….whereas typically, in a smaller situation, the Broker will know each agent pretty well and that relationship and direct understanding of each helps to open up communication (ex- feeling free to text your broker direct or have them help you run your current transaction while out of town/sickness/etc…)
    In this smaller scale environment, agents feel comfortable to contact their Broker vs. feeling like they are bugging them. And in turn, Brokers are more likely to be contacted by their agents and get the opportunity to guide the agent to a quick resolution that the agent not only understands and is happy with….but learns from.
    Within time —when a resolution is needed by the same agent, they still call on you (as they should if anything is in question), but now they piece together different little parts of various resolutions you’ve had in past for their new predicament and Wa-La…you are amazed to hear their idea of good resolution and so proud of and thankful for them, your agent, because at that point, they are truly a representative of you (the Broker).

    With that being said, I would never expect any company to contract with 100 people with promise/expectation to give (or do they bring) each 50 deals a year (personally), so it’d be a difficult presentation I think and ultimately, I have hard time believing this will work—but if you believe it will, Go For It and I Wish You Best!! I have been wrong once,lol.

  8. I have been operating my own brokerage for two years now, and I consider the organization completely different from the competition. I consider myself having a wealth of knowledge, and have leads coming in from every aspect possible. Although I am liable for the agents who work under my brokerage it is what I know that will take someone to the top. I do not promise agents anything I cannot deliver, however, if they want a “piece of my pie” they have to prove their-selves to me. Larger companies will hire anyone without calculating the time and money it spends to train that person, and personally their training programs have not caught up with today’s technology. As a small brokerage, I have learned to pick and chose who I bring on to the time very carefully.

    Josh Taylor

    For more real estate information visit sellingtb.com/weblog and follow us on Twitter @sellingtb

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  10. Great write-up!!! I started my real estate career at a very young age in 2001. I joined a large family owned company that at the time was the largest family owned company in New England and very close to being the largest in the country. They were relatively selective with recruiting and had non-competing sales/office managers. Shortly after, they sold the company to one of the national brands and the recruiting goals went through the roof meaning we had very high turnover and lots of non-producing agents. I stayed with them until 2009 and then finally worked up enough courage to join what I feel IS the model company of accountability. They pay well but you must also sell well in order to survive as I also have a monthly obligation to the company. Since that monthly obligation is fixed, my incentive to quickly cover the expense means I get to realize real profit. In essence, we are both accountable. They do what they say they will do and I do what I HAVE to do.

  11. Great thought but when you run the statistics from the local MLS you will see that only 10% of the agents do most of the selling. So while it would be a beautiful thing to think that what your saying would work, in every office there are a few agents who just do more and some that do less. Every agent is responsible for promoting themselves the brokerage takes responsibility for promoting the company to drive business to the company, how the agent handles the business or who the consumer wants to handle their investment, and how is that agent going to prove that they are the one to be trusted with the clients investment, is up to the individual agent and how they cultivate their reputation in the business.

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