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Big Company Vs. Little Company

Dog We've all heard the old saying "It's not the size of the dog in the fight, but the size of the fight in the dog". I was wondering how this applies to a real estate brokerage. I started my career while in college as an intern for a broker in my home town. He worked for a major real estate franchise and I started out doing busy work for him...making copies, stuffing envelopes, etc. Soon thereafter I got my salespersons license, and was planning on activating my license with this broker's office. I was naive at the time and did not do much research on what the costs would be to work for this company prior to getting my license. Needless to say I was shocked to find out how much it was going to cost me to have my license held by this office. I decided not put my license with a big company since I was not sure if real estate was the career for me or not. I put my license with a much smaller local brokerage that did not cost me anything other than my commission split. I was given the freedom to work when I wanted, no floor time requirments, and I got hands on personal training from my broker. After several years passed I was confident that I could open my own brokerage and I did.

Since we opened we have experienced significant growth, and our clients could not be happier. The more I talk to outside agents I have found that many new agents feel that they will be more successful at a large office. At the same time I have found that many experienced and successful agents are either leaving their major companies to open their own private brokerages or work for brokers like myself. Why work for a large company that costs more, pays less, and is willing to hire just about anyone with a license? Companies like mine can offer the same marketing services to our clients, can afford to pay our agents more since we have less overhead, and can offer more personal attention and flexability to our agents. I always ask other agents, "Are your clients working with you because of the company name on your business card or because you did a good job selling yourself to them?"

I would love to hear your thoughts on why a bigger company is better or worse.

Posted by Ethan Van Eck- South Elgin, IL on 01/04/2007 04:29 PM

Comments (6)

size, big brokerage, small brokerage, big company, small company, company benefits, recruiting, experience

6 Comments on Big Company Vs. Little Company

JAN

2007

I am a big believer in the small independent. I am the one who provides the service. I am the one who has to put money out to market myself. I am the one who needs to build a reputation. I am branding myself. The small independent is the best way IMHO to get that done.

I feel I have the best of both worlds in my office. We're relatively small (26 agents), but an international firm (ERA).

In all honesty, I think it comes down the personalities of the people you work with. Our office is very family like. We all get along, tend to share ideas, co-list properties, etc. There's not one person in our office that I don't like. I hear this isn't common at most real estate offices (big or small). That being said, some people have left our office for any number of other firms in town that they thought they'd be a better fit with. So...I guess my point is that people need to find an office that "fits" their needs and likes and go with it. Big or small is irrelevant. One size doesn't fit all.

Oh - and in regards to being more successful at a bigger office vs. a smaller office - success is in the hands of the agent, not the company they are with. Either they are or aren't going to be successful. It's up to them and only them. The company they belong to has nothing to do with it. Just my opinion.

JAN

2007

I appreciate your responses, and I do agree that success lies in the hands of each individual agent regardless of where they work. Also, I can see some professionals working better in a more structured environment or a large company. However I think that the successful agents are self motivated and do not need a corporate system to succeed. As professionals we owe it to ourselves and our familes to ask the question, "Am I spending more or making less money because I work for a well recognized name? And, does this large company offer me or my clients any substantial benefits that I could not receive or offer in a smaller office?" To each his/her own, but please ask yourself these important questions.

Again, great comments...Thanks!

Success is in the hands of the agent and not the company that they work for. However, I have seen companies that hold the agent back from being the best that they can be. I have typically experienced that with the larger firms because of the corporate inflexibility to treat each clients needs as individual and unique.

With that said, the Agent does have a choice. They can choose to be held back and play by the less flexible rules and systems of the larger companies. Or, they could choose be part of a dynamic change in a smaller office that caters to treat each clients needs as an individual. And this hopefully will translate into a better income, better service and a better way of living all around.

APR

2007

Congratulations Ethan! I think we share the same vision, I waned to take care of the customers with totally competentagents (how sad that becomes an 'extra" in out market) who deal fairly and give great, personal service. We did join a national franchise which has been worth every penny for the referrals alone, other support and access to health benefits notwithstanding,

I got active in CRB and got my designation early on, I strongly recommend this for new brokers, It saved me from serious mistakes and allowed me to correct other major mistakes early on. Take the Finance and recruiting courses if nothing else. You will learn at what size you business will take on additional overhead and be able to plan for it. Small is beautiful' you keep control, but you will work a lot of hours doing two jobs. If you want to grow out of that, there is a pathway to keep you from getting too much overhead before having agents to support it,

For the record, I am at that stage where the options are "get small" (downsize);"get big" (recruit and market hard and fast"; or "get out" sell the business and take a cruise. Each option carries a certain appeal and my preference changes from one day to the next. Once I make that decision, I will have to put a plan in place and carry it out- no second guessing,

Good Luck This business is the most fun I have ever had with my clothes on! :)

FEB

2008

Thanks for a great post.

I'm an agent with the largest brokerage in the region. They really have some great tools and provide wonderful training. I came for the training, but now feel that I am just throwing my money away. They also provide the opportunity to take national programs (at our expense). The odd thing is that all the programs tell us how real estate is all about personal relationships and the connections you make with people and the community. If that is the case, do we really need all the tools and a 50/50 commission split? If you look at the top producers in our market, only a small percentage are using all the tools; they have great connections and do a lot through referral. I have just received my broker's license and have been advocating a smaller, leaner and more flexible brokerage. I would love to know more about your company's fee structure and commission splits.

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