How would you feel?

Posted on January 31, 2012 by

 

Let’s say you went through the interview and hiring process to locate the very best Real Estate Company and agent to market and sell your home.  You spend a considerable amount of time haggling, pleading, listening and learning about the right price to offer your home to today’s real estate market.  You learned that your property would be exposed via the internet and various private websites, agent websites, association websites, franchise websites, blogs, twitter accounts, Facebook in general your property would be put in the face of everyone who comes into contact with the internet whether they had an interest in buying or selling real estate and also specifically those who are interested in buying and selling.

You were no doubt instructed about the critical need to be accurate and competitive with your  price positioning as today’s consumer has many many resources for information on for sale property.  One thing was made clear.  You were giving permission to the broker owner via the agent to offer your property to the real estate community and to the public via the local mls then on to various other destinations for viewing. You were told that it was critical to display your home in it its best light.  If you have a truly professional agent they photographed your house with care.  Many times they probably rearranged your furniture, cleaned off counter tops, emptied closets and in general disrupted your life style because as the professional agent explained, “We live one way and we sell another” which translates to you doing a great deal of work.

So you sign a contract, your property is put into the MLS and your home is now online for the  whole world to see…nosey neighbors…in laws…co workers and so on.  You are laid bare.  Then one day when you return from grocery shopping you see it, another sign in the yard with a funny name you do not recognize…looks like Zebra or something they have put a sign in your yard and on this sign they have posted their opinion of what your home should sell for …AND.. it is  not  what you agreed to…In addition they also included another thing called value range which listed a high and low price which again bears no resemblance to the  value you and your Agent worked so hard to establish and what the heck does value range mean anyway?

What is an owner to do?  First thing is to pull out the signs then call your  agent to find out just what this was all about…did they do this?  Why? Your agent assures you it was not them it must have been vandals or competitors who were jealous. Your agent agrees to post a guard but the things appear again like magic.

Well folks, doesn’t this sound real?  It is. How do you feel about it?  What are you going to do about the abuse of the data you provided and worked so hard to get?  I understand why today’s Media Company aggregators exist.  They exist because we should have been doing a better job.  But one thing for sure if we decided not to provide information to those aggregators who took liberty with the data they desperately need to attract eyeballs to attract advertisers they would be out of business.  There are many venues to display and market real estate, but you, the feet on the ground provide the sweat, blood and tears to get this information. 

I think it would be foolish not to provide the broadest possible dissemination of info to the broadest possible buyer pool and to try and get the maximum out of your marketing efforts.  However it seems that there should be fundamental rules that should be followed.  I know that control of the data is a struggle but let’s break it down into its most understandable format and  ask ourselves, If I were selling my home would I let anyone put up signs in my yard without my permission?

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Commission Plan or Price List

Posted on December 15, 2011 by

Without fail, when I have spoken with brokers over the last few years one of the most frequent requests I receive, especially when talking about Business Planning is: “Can you get me some other commission plans or how does my plan compare?”.  With due respect, this is the wrong question or request. 

I in turn will ask for their: “Success Plan” most often this is referred to as “A Value Package”.  I prefer “Success Plan” because of its direct implication that we have a plan for your success as opposed to a Value Package which reminds me of a “Val Pac” coupon book or envelop.  This Val Pac is often a collection of discounts or coupons.  Val Pac does not imply Plan for success it implies discounts, cheaper, etc. The challenge with labeling your “Value Package” a “Success Plan” is that you then need a clearly defined plan for action with verifiable proof that it works. 

Now your commission plan is really what you are trying to get your agents to pay you for your “ value package”. Every Val Pac that I ever saw was free.  It came in bulk mail or maybe blown into a Sunday paper supplement.  Of course Groupon is taking dead aim at the Val Pac.  To have an effective Val Pac you must have enough coupons, discounts or special offers to get enough consumers to use them. When you focus on your Commission Plan without knowing the real Value to your Agent Consumer you are missing the ball totally.

If you are ever planning on growing your company Organically or by recruiting you must retain your good  customer/agents by offering them value thru successful systems, processes, tools, etc and then getting them to pay you your price aka your Price List for your Success System which if used will provide your agent customers what they want…success in the real estate business.

When you are trying to recruit an agent who is experiencing success many of us feel that our commission plans are holding us back.  The reality is the agents will not pay your price for what you are         offering.  These Top Producers are usually the wrong customers for you unless you are planning on offering them a better deal or price than what they are currently getting. They already have their own “success system”.

RECRUITING IS MANDATORY for growth.  To be effective recruiting company’s you must know what you are selling…Your Success System and you must believe and be able to demonstrate that it works.  There will be adjustments that will need to be made, but at least you know what you are adjusting and if it will make sense in the long haul. There are many tactics that you can and should employ to become effective Recruiting Company’s but one of the first is to get your head straight on what you are selling.  Your Compensation Plan is your Price List for your Product. 

You will be hearing a great deal more about RECRUITING in the next few days, weeks and months ahead.  Get ahead of the game by evaluating your Success System.  You must make adjustments as needed and then price it competitively.  The best sources for what your competitors charge are your competitors’ agents.  So often they are willing to share what they are paying or being paid in order to pay less.  This is human nature. 

So, do you have a Commission Plan to accompany your Val Pac, or do you have a Price List for your Success System?  Just ask your agents to list the ways your company helps them: Find more and better buyers, how do you help them convince buyers and sellers to work with them, and how do you help your agents work with buyers and sellers to build loyalty.  If you get some glassy stares…and you will, start right there right now

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Where Does Fear of Agent Loss Come From?

Posted on November 30, 2011 by

I recently replied to a post by Jose Perez, PCMS Consulting: The Real Estate Shrink Analyzes … Enabling Poor Performance pcmsconsulting.com . I hope this provides some help.

Where does Fear of Agent Loss Come From?

When asked about assessing the potential for managers success, Jack Welch who hopefully needs no introduction, shared a decision tree that helped him:

  1. If the manager does what I ask, but does not hit the numbers then I will work with them.
  2. If the manager does hit the numbers but does not do it the way I ask…I will work with them.
  3. If the manager does not hit the numbers and does not do it the way I ask…they are gone.

This was the gist of his brief explanation which of course takes a lot more into consideration but this was one of his decision tools.

What does this say to you?  First, he believed that if his managers did it his way, they would be successful.  Of course they had to demonstrate some individual initiative as not everything goes according to plan.  Competitors don’t just lie down and die.  Customers don’t always agree and can be pretty fussy.  But Jack felt in his heart that he had given them the tools they needed so that they could compete and perform.

The second person who hit the numbers but did not do it his way, represented a learning opportunity for Jack as well as an obvious candidate who could show initiative and succeed so naturally that manager was a keeper.

The third person, who did not hit the numbers and did not do it Jack’s way could easily be 80% of the existing real estate sales force today and probably 80% of managers and owners, but we are afraid of losing these people…why?

The first challenge each of you have is to determine “Do you have A Way”, a “Success System” that you can point to and say this will work.  Now you must monitor, adapt and change as needed but you must start with something that you have reasonable belief will work based upon demonstrable successes.  Do you have successes (agents) you can point to that do things “Your Way”?

To help you define “Your Way” I offer the following:

  1. In our company our agents find more and better buyers and sellers by…..(fill in your way)…
  2. In our company our agents Convince buyers and sellers to work with them by….(fill in your way)…
  3. In our company our agents work with the buyers in sellers to build Loyalty by…(fill in  your  way)..

If you and your agents can fill in the blanks and then point to how “Your Way” has been successful, then you have “A Way” or a “Success System” and you should be able or at least willing to sell it with passion. Having something that you can sell with passion will help you lessen or eliminate the worry about agents or managers who do not hit the numbers.  You will be able to recruit to a successful system and agents or managers who do not hit the numbers and your fear of loss will cured.

Have the courage to ask your agents about “Your Way”. Ask them to fill in the blanks…you might need some Bromo Seltzer when you read the results.  Do you really have a “Success System” or do you have a lot of parts but no system into which they can be integrated?  Many brokers have lots of “Parts”. This is critical in today’s real estate sales environment.  The sooner you find out if you have a “Success System” the you the sooner you can fix what is  wrong and then begin  to sell “Your Success System” with Passion!! Please don’t Wait!!!

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Just because you think you make GREAT pizza…

Posted on September 23, 2011 by

Just because you think you make great pizza you should not run right out and start a pizza business.  I promised this post in my last post…Recruiting and Growing Asparagus Have a Lot in common.  Maybe I should call my site “The Foodies Guide to Recruiting”?

The concept is not new in fact “the E-Myth” by Michael Gerber does a wonderful job of explaining this concept. This is highly recommended reading for those thinking about opening their own real estate sales store and for most of the people who already have.  In Michael’s “The E Myth Revisited” he follows the journey of a young woman who is lauded about her pies.  Praise and advice is heaped upon this young house wife until she takes the plunge and opens a bakery.  The ensuing result is a tragedy.  The housewife is devastated to learn, the hard way, that running a bakery and being a great baker are two different skill sets and require much preparation and excellent implementation.

In Michael’s story the woman is at least a good baker but she is missing the business skills.  In my story, the pizza maker just believes that he is a good pizza maker and does not necessarily get overwhelming support from his pizza dinner guests on the quality of his pizza…but he believes it will sell.

Of course you must first believe you have something to sell. There is nothing worse that someone who is trying to sell something in which they have no faith. It is sad and frustrating to listen to real estate business owners who lament that they cannot attract good agents and do not understand why these agents would not want to come to their company. Usually the reason offered by the business owner is, “I cannot compete on price”. I will not pay those ridiculous splits, I offer far too much, why can’t they see the value…”How can they not like my pizza”, and so on.

 If I were to open a Pizza Parlor, I would first visit all of my potential competitor’s stores and sample all of their pizza.  Now I probably won’t like it…I might grudgingly admit that some of the pizzas are not bad but of course none of them are as good as mine. This is a good first step as far as it goes.

The next step is to stand outside the competitor’s parlors and ask the customers who are buying pizzas, why are they buying this pizza instead of other competitors?  I would make sure I monitored the busiest parlors.  I might even ask them to take a taste test to see how they like my pizza, provided I have the guts to hear what I might not want to hear.  I might also tell them the price and whatever else might make up the pizza experience they would receive if they bought the pizza from my parlor to see if they would have interest in my pizza. Only after this effort to test the waters then and only then should I make the decision to open a pizza parlor. 

I would still need to be prepared to make changes and not be surprised when the customers do not immediately start buying.  If I cannot get satisfactory response, my next step is simple.  When I want pizza I will just bake my own and as far as a new career…well I guess I would just keep my day job unless I plan on buying all of my own pizza or I have a really rich mother who will.

So future and existing real estate brokerage owners, have you polled your existing and future customers regarding how your pizza tastes?  If not, get to it fast and make sure you ask the right questions and ask the right people.

 Say, I guess this Pizza story applies to me as well!  So current and future consumers of New Vision Pizza, what do you think?  Unfortunately I can’t ask my mom, I know she would love it so I am asking you.  Please let me know and thank you in advance.

Next week,  Who to ask and how to ask the right questions of current and future customers.

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Recruiting and Growing Asparagus Have a Lot in Common

Posted on September 10, 2011 by

3. Q. How long after planting asparagus can I harvest the first spears?

A. If you plant seed, you should wait 3 years before the first harvest. If you start from 1-year-old crowns (the recommended manner), harvest can begin to a limited degree the next year. Harvesting early will drastically reduce yield as well as quality of home-grown asparagus.

 This information appears in a bulletin provided by Texas A&M

There certainly is no shortage of metaphors that compare real estate sales to agriculture but here is another one that often evokes surprise when I bring it up to brokers who are impatient with their recruiting or non recruiting efforts. 

Whether you are growing asparagus or recruiting experienced agents there is a time frame that you cannot ignore.  The one point of certainty is if you don’t plant either from seed or from an already established plant, you will never harvest asparagus.   Most of us are impatient by nature.  This becomes apparent when we build a recruiting plan that calls for adding X number of additional agents in order to boost our sales and profit production.

The typical recruiting business plan calls for the addition of these agents who will produce a specified number of transactions.  Unfortunately unless you have planted seeds prior to the writing of your recruiting business plan, you are almost doomed to fail.  In order for these agents to produce the numbers you need you must have them for at least a year.  I have never seen the requisite number of agents show up on January 1 so you can get the benefit of their full anual production.  Agents do not join you when it is convenient to you, they might join you when it is convenient for them. 

Whether you are trying to harvest asparagus or agents, you must plant and tend.  You must provide the right environment and you must never, never harvest before it is time.  The plants will not be rushed.  If you harvest to early the results are tough and unsatisfying and the same will apply to agents who you manage to “close” before they are ready. The crop of asparagus and the agent will disappoint.

On a happier note, once you have made the initial investment of time (one to three years) and effort you will have a crop every year.  How much you harvest will depend on the number of seeds you have planted and how well you have tended your garden.  So whether you want to harvest asparagus or agents, plant now to have a steady crop down the line.

Therefore, if you have now found religion in recruiting start now with an eye to the future. Once you have established a sizable garden you should be able to harvest a crop of delicious producing agents who will add to your bottom line and make your recruiting business plan come true.

Another to consider about recruiting business plans that establish a specific number as though when you hit that you are done, don’t do it because  you are never, never, never done recruiting.   Any number you establish should be an annual minimum target which should be based upon your ability to absorb and integrate the agents into “Your Way” of selling real estate and your annual profit goals.

As the asparagus analogy should make crystal clear, you cannot stop and start and expect to have an edible crop.  The same applies to your recruiting effort.  You must be constantly in the market listening to your future crop.  So I hope everyone will take heart and realize that you can harvest you just need to understand the process.

Check in next week when we explore the dangers of starting a pizza business just because you think you make great pizza.

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“Let’s take it for a drive”

Posted on July 15, 2011 by

Recruiting Alert # 16= “Let’s Take if For A Drive”

“Let’s take it for a drive.”  Anyone who has ever purchased a car new or used has either said these words or had the sales person say them to us.  When we agree or ask we are moving down the path to a sale or purchase.  The drive is not a guarantee, because the car may not meet our expectations and that would be bad for the sale but none the less a necessary part of the process.

I don’t think any of us would just look at all the glossy marketing material and buy without driving.  Marketing might get you in the door, but the car needs to deliver.  Of course the sales person’s dream is that you will pass someone you know who might look at you in admiration at your ability to swing this great new ride.  There is nothing like validation from your peers to help move you along.  I have read that validation is a hot benefit of Social Media. How cool.

A test drive, deal killer or deal maker?  There are other details to make the sale come true, price, terms etc.  But once you want the car there is usually a way to get the deal together.  The drive can cement the desire or it can stop the sale dead in its tracks.

The point for recruiting is simple.  How do you get agents to take a drive in your Real Estate Success System, your company?  Sure you have great “recruiting brochures, glossy marketing materials, snappy ads on the internet and other media but if you agree with the concept of the Test Drive as valuable to the sale then how can you incorporate this into your Recruiting Sale (aka interview presentation)?

Here are some thoughts.  Go live to 21Online and demo or give them guest privileges.  You could demo the Learning Site, sign them up for a course, you could create a couple of e campaigns….if you were real comfortable using this tool yourself, you could open up the Seller Services Presentation and let them make changes for themselves…and there are others of course.

Another thought is to point to your wall of agent photos.  Tell them the story of Sally, or Walt and explain how they came to you from other companies, used your tools and systems and turned mediocre sale performance into a true solid Business and Career.  Better yet, have Sally or Walt tell it themselves.

A word of caution here, make sure that your stars or up and comers far outnumber your professional naysayers, coffee drinkers, has beens, never beens, washed out…non producing dregs.  What is the real picture of your Success System?  Is it dominated by hot cars that give great test drives or is it full of tired, dull retreads who live off past reputations? When their peers note that they have moved to your office will their peers look at them with admiration and respect or indifference or disdain?  Remember the Test Drive.

The choice of what you are selling is your’s and your’s alone.  “Let’s take it for a drive.”

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I am excited to begin a new recruiting class today.  I call it Recruit 4 Lunch simply because it is conducted in the noon to 1:00pm spot which is traditionally occupied by lunch.  I know that many people will tell you that they never eat lunch or do not have time or per Gordon Gecko…”lunch is for wimps”.  There will be no wimps in my Recruit 4 Lunch Class.  This is a good thing, because recruiting is not for wimps, or the faint of heart or the insecure.

It is amazing however, the position that recruiting occupies in so many real estate brokerage owners hierarchy of tasks.  So often when talking with Broker owners or sales managers I hear the lament, “I  know I should  recruit but I don’t have the time”  or other similar rationalizations.  To me this is about the same as someone who claims to really, really want to run a marathon…but just can’t find the time to train.

Why, why would someone start a real estate brokerage business without understanding that recruiting is their business? Agents sell houses using the Broker Owners techniques, skills, training, best practices, support etc.  This is why agents agree to pay the owner part of the commission they earn when, they sell a house.

Here in lies a fundamental problem.  As agents get better at the three fundamental Real Estate Sales Processes of:  1.Finding buyers and sellers; 2. Convincing them to work with them; and 3. Working with buyers and sellers to build Loyalty…they seem to need the services of the broker owner less and less and are therefore less willing to pay the Broker/Owner what the Broker/Owners need  to earn a living running a real estate brokerage company. The Broker/Owner then is compelled to sell real estate to keep the  Real Estate Brokerage business alive…which is totally contray to why most Broker/Owners started their brokearage business.

This, I feel is one of the biggest hurdles for Brokerage owners to handle.  They want  and need motivated and productive agents but those who  are already productive may not need what the broker is providing and the broker’s business model needs more revenue than can be  generated by what the productive agents are  willing to pay.

What is a Broker/0wner to do? This is what we will explore in our Recruit 4 Lunch Class. How to sell the Brokers product and to whom…do they have a market?  The class will ask the participants to really evaluate what they are trying to sell and to determine if it is relevant or if they must change their offering…much like restaurants and other businesses who need to update their menus, inventory and services to appeal to today’s consumer…or at least the consumer they are trying to attract which will in most cases not be everyone who lives and breathes.

I hope to see major behavior changes and honest business evaluations.  I hope to see that I have been able to make a positive difference in the businesses and lives of the participants.  After all…I need to be able to provide what my customers need for today’s market.

Posted on July 7, 2011 by | Leave a comment