Does A Broker Deserve To Make A Profit?

Real Estate Agent with Keller Williams Realty Southern Arizona (Sierra Vista)



Brokers Are Often Broke!

Image of Broker Is Broke


For many years, there has been increasing pressure for real estate brokers to reduce their fees, enhance the technology and agent services they provide, and provide increased “splits” with their sales force.

All fine ideas, if you are an agent.

But, from the broker’s standpoint these issues appear a bit different.

Small brokerages, if they have an incredibly low overhead, can compete in a couple of these areas... but not in technology and agent services.

Large brokerages, where hundreds of agents are on the rolls, often do provide for most of these needs in their business models, but often are deploying many under-trained, unskilled agents ot into the public without much in the way of supervision.

Medium-sized brokerages are perhaps hit the hardest, because they are required to provide “back-room” staff, and other administrative personnel. Their overhead is usually pretty high, and they are under constant threat of their agents demanding greater “splits, technology, and agent services. Since agents are independent contractors, and generally in demand, all they have to do is sign a form, or “click” a box on the Internet, and “poof,” they are now working at another brokerage.

So… the question is, Does A Broker Deserve To Make A Profit?

Of course. Why else would brokers be in business?

The common denominator to all of the above scenarios is well-trained, well treated agents who are satisfying their objectives. Training is where most companies drop the ball, leaving themselves vulnerable to recruiting efforts by their competitors.

Training is not inexpensive. It can be done by contract, bringing in outside entities, or… best yet, is to develop in-house training that is routinely and relentlessly delivered.

Then, brokers… take a good look at your business model, and decide what “tweaks” you can make that reduce your overhead, while maintaining an excellent environment for your independent contracts.

Challenging? Yes. Open to modest, but effective, increased profits? You betcha!!!


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Richard Weeks
Dallas, TX
REALTOR®, Broker

Company dollars need to be made are you will not be in business.  I think most brokers fail to recruit, retain, and make their agents profitable, and that is why they go broke.

Sep 27, 2011 06:29 AM #1
Linda Urbick
RealtyOne Group - San Ramon, CA
Selling San Ramon Valley - 925-786-5132

anyone taking on the responsibility and the expense of any type of business is there to make a profit and real estate is no different.  It is not always about the fees a broker charges the agents - it is what the agents get for these fees to help make them successful and the broker succeed.

Sep 27, 2011 09:31 AM #2
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Mike Dennis

Associate Broker GRI, ePRO, CIAS, CDPE Sierra Vist
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