Making Your Company Number One In Your Marketplace

Most real estate offices are run backwards by brokers who insist on wasting the bulk of their valuable time on problem-solving and production issues.

What I have found working as a consultant with companies around the country is that owner/managers who improve profitability in quantum leaps actually focus most of their attention, time and energies on recruitment and retention of experienced associates. For every production problem you work on, you increase your market share by one transaction, but for every associate you recruit away from the competition, you reduce their market share and increase yours by the amount of that associate's annual production.

Most brokers know that they should be putting more effort into the recruiting process, but the frustration factor deters them from pursuing it. Many brokers take the rejection that often occurs with recruiting personally, so they would rather not deal with it. But, consider this: recruit one $2 million associate, and you increase your bottom line by $2 million; reduce your competitor's share by $2 million; and enjoy a net gain of $4 million. Recruit 10 - $2 million producers over the course of a given year, and you can increase your market position by $40 million.

Any company that can become $40 million stronger in the marketplace during the course of a single year is likely to generate more associate excitement and enthusiasm, more signs, calls, listings, more opportunities to increase business and, of course, more profits for its broker/owner. In addition, many problems associated with low producers will disappear because low producers will make up less and less of your associate base.

TECHNIQUES TO STAY ON TRACK

Sometimes, existing associates can interpret a broker's recruitment efforts as a threat to their own position. They can associate a stepped-up recruitment emphasis as meaning less floor time, fewer referrals and more people invading their territory. So, how can you diffuse associate opposition? By enlisting their active support. Convey to them, in concrete terms, the benefits of increasing the company's overall market share -- namely, more listings, more calls, more closings and more cash in their pockets.

One idea is to prepare a simple graph and post it on the bulletin board. The graph should show your company's annual market share goal. The target would be $40 million (as outlined above). Then, throughout the year, chart the progress you make toward that goal. Enlist the help of associates to prod you to that goal.

WHO SHOULD YOU RECRUIT?

Are you spending most of your time trying to recruit Top Producers? Why? Most are happy where they are. After all, they are the ones making the money.

Many brokers make the mistake of wanting only the best associates or associates in offices which have a higher market share than theirs.

Super high-end producers are never the easiest to recruit, and brokers have to give so much to get them that you end up losing profits. Focus on associates whose offices are below yours in market share, because these are the ones who are going to be most willing to come to you. Increase your staff, and in time you will increase your market share. By doing this, the best ones will eventually want to come to you. Look to hire someone whose needs you know you can fulfill, whether it be through existing marketing support systems or ones that you are willing to implement in order to attract strong producers.

Are you interested in attracting brand new associates? If so, you may want to look to the personnel departments of major corporations who are in the process of layoffs. Some of these companies have funds allocated for employee re-training and are willing to sponsor job fairs, underwrite the costs of real estate license classes and even subsidize a new associate's income for up to six months. Contact these corporations and let them know you have job opportunities to offer.

Another idea is to recruit recent home-buyers. Sound crazy? Well, consider this. According to the National Association of Realtors, 7% of all the real estate salespeople are doing 93% of the business. That said, a recent homebuyer has only a one in ten chance of being happy with the service he or she has received and may feel that they could have done a better job. That homebuyer becomes a prime target for recruitment. To find people who would like to become real estate licensees, I suggest you call people who have recently bought homes in your area. Tell them that you have openings in your office and are trying to locate people who would like to build a career in real estate.

This technique can also be applied to homeowners whose listings expired without being sold. FSBOs, too, as they clearly have no lack of confidence in their ability to sell, nor are they afraid of risk-taking. Let them know up front that you are not calling about their listing, but about their interest in a real estate career. After all, even if they aren't interested, they may decide to let you list their home.

An interesting variation on the traditional career night is to hold a Success Seminar for people who are thinking about a career change.

SYSTEMS FOR ATTRACTING EXPERIENCED ASSOCIATES

To attract experienced associates, you need to establish a relationship with those individuals. Here are several suggestions that small and large companies find useful in building rapport and bringing the associates into your office.

Letter Campaign

Recruiting associates is just like farming your area. You target whom you want, then get your name out. Build a list of the top 50 to 100 associates you'd like to target. Then, develop a series of 10 personalized letters, each focusing on one unique aspect of your company. Topics such as market share, commission structure, management setup and technology options are great hot buttons. I suggest sending one out every month and following up with a phone call. I also suggest sending out postcards advertising: Who you Just Hired, Another Associate Moves or Another Associate Joins XYZ Company. Recruitment letters should be educational and should never blast the competition.

Target Fliers

I call these target fliers because they are strategically sent at specific times. For example, when an experienced associate with another company loses a listing to one of your associates, you can send out a target flier to the associate who lost the listing touting the benefits of joining your company. Follow that with a phone call and emphasize that it was not the associate's selling skills that were deficient but the selling systems and opportunities your company offers were judged to be superior by the seller. This helps create, in the mind of the associate, the perception that it may be time to change companies.

Piggyback System

Many associates are hired away when one experienced associate leaves an office. I have found that when that happens, the office itself becomes vulnerable to recruitment raids for 10 days after. Think about it. This logic is along the same lines as when a “ For Sale” sign goes up in a neighborhood -- it offers an excellent opportunity to call other homeowners to see if they want to sell. So, when one associate leaves an office, it opens up the door to heavy recruitment of others in that office. After all, those associates may get in the mindset of “ the grass is always greener on the other side.”

Cold Calling

After sending a letter, always follow up with a phone call. Here are some ideas for conversation starters. First, ask if they received your letter. For this example, we'll assume the letter was about your company's call coordinator system. Ask them if they are familiar with the system or if they have the system in their office. Then go into the benefits of the system and how they can increase business xx percent with a system like this in place. You need to be able to demonstrate that something your company does can increase their income by $30,000.

Another idea for cold calling is a survey. You may say that you are surveying top-producing associates in the market trying to figure out what kind of technology they need most. Then tout the benefits of the technology your office offers.

Open Houses

Go to a competitor's open house that is in the same neighborhood as an open house for your brokerage. Tell the competitor you are in the neighborhood visiting your associate's open house and thought you'd stop by. Ask the associate to take you through the property. As you leave, let the associate know you will pass along information about the listing to your associates. The next day, send a personal note to the competitor's associate saying, “Thanks again for showing me your listing. I've told my associates about the property. Good luck with the listing and if there is anything I can do please call. Your friend in real estate, Jane Broker.”

If an associate does have a buyer who may be interested in the competitor's listing, have that associate call the competitor. Have them say; “Jane Broker said she visited one of your open houses several weeks ago, a two-story colonial. Can you give me the address so I can take some prospective buyers to see it?” This, along with your mailings, will put your name in front of the competitor's associate.

KEEP YOUR NAME OUT IN FRONT

You can't make an associate leave who is happy with their present broker, but you can make him or her think of your company when he or she is ready to move on. Staying active in your local Realtor association and community helps to build general awareness of your company's name. Plus, you can use specific strategies to reward associates who do business with you and make it more fun for them.

To do this, you need to set up a system to track every associate who cooperates with your company on a transaction. I realize this is a lot of work, but the payoffs are great. Once this system is in place, within 24 hours of signing a contract, call up the co-op associate to thank them for the business. One to three days after, send a thank-you note to the associate's office. Follow up by delivering, personally or by courier, a thank-you gift with your company's name on it. The gift can be as simple as a tin of popcorn or chocolates, but it should be sent to the office so other associates can see it. Of course, this sends the subliminal message that doing business with your firm brings rewards. Just prior to closing, mail another letter to the associate's office thanking him or her for bringing the transaction to a successful conclusion. Everyone who co-op's with your office should be on this system. Only after the closing should you show preferential treatment to the associate you want to recruit. At that time, send a letter to the associate's home letting him or her know of your particular interest. The person will feel special and sought-after when he or she discovers that not everyone in the office was pursued in this manner.

Successfully recruiting experienced or new associates takes time and effort. With recruiting systems in place, you can focus your attention on your current associates while recruiting the best people for your brokerage.