COACHING Ad Hoc Fees: These are items that real estate professionals may regularly be charged as part of their business, but on an as-needed basis. Examples include admin support, lead generation, office/copy expenses, signs, etc.
In our ever-changing industry, how do you communicate your company’s value to attract new agents and retain the ones you have?
How to Monetize Your Real Estate Brokerage’s Value Proposition
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By Sherri Johnson
hat is it about a real estate company that makes an agent want to join or stay with a company? There are as many answers to that question as there are real estate agents. Every office or company has its own pay structure, support systems, culture and other attributes that make it unique in its market. But in our ever-changing industry—with options ranging from fullservice brokerages to 100% commission companies—how do you communicate your company’s value to attract new agents and retain the ones you have? Whatever your model, you need to be able to monetarily compare and contrast it to those of your competitors in order to show agents why affiliating with you is in their best financial interest. Some of the numbers (e.g., agent commissions on “x” amount of GCI or units) will be relatively easy to calculate, while others will require some estimating. Consider including the following in any comparison of your model to other companies’ models: Total and Net Commissions: GCI can be based either on past perfor30 July 2021 RISMedia’s REAL ESTATE
mance or anticipated future production. Net commissions to the agent or broker would be the amount they receive after franchise fees, company split or other adjustments to the topline number. Transaction Fees: Include flat-fee charges that occur on a per-deal basis in this number. Recurring Fees: These will include a wide variety of items that will happen monthly or on some other regular basis. They may include desk fees, technology fees, E&O insurance or other charges.
Non-Monetary Items: What is your brokerage firm worth to the agent’s business? How do they earn money? What is their likelihood of generating more transactions with you versus another company? Use this to quantify the value of their affiliation with you and make it part of your discussion. Any holistic analysis of you versus anyone else would be incomplete without monetizing your value proposition. After reviewing this with a potential or current agent, be sure to discuss the unquantifiable advantages of your company like your culture, your brand in the market, etc. While the comparison above is used to make the monetary case for your mutual affiliation, these “soft” advantages must still appeal to the agent and should be highlighted. Use this method to show how being a part of your company is in an agent’s best financial interest, and you will attract and retain more agents as a result. RE Sherri Johnson is CEO and founder of Sherri Johnson Coaching & Consulting. Johnson offers individual and group real estate coaching, and is a preferred coach for multiple national brokerages. She consults and speaks regularly for many leading industry organizations, including RISMedia, NAR, McKissock Learning and Homes.com.
