McDonald's hamburger or one made by Wolfgang Puck?
- Team of experts lowers the cost for agent but not the price to the public
- Assembly line is great until there's an unexpected problem
- CPA or H&R Block
Is it better to have an agent who has a team of specialists to help you through the transaction or is it better to have a lone agent who does everything themselves from A to Z?
The comparison I like to make is having a hamburger made assembly line at McDonald’s or having your personal “Wolfgang Puck” create you a custom hamburger?
Are the best hamburgers made at McDonald's?
McDonald's, Burger King and Wendy's all have a well-oiled team approach to making hamburgers. They sell billions. Why would anyone go anyplace else?
In real estate, the team approach is like getting a McDonald’s hamburger but being charged the price of a custom hamburger created by your personal chef. Wouldn't it be better to have your personal chef create your special hamburger, especially if it doesn't cost you any more? What if you could get the personal service of your own chef for less than the assembly line process?
At McDonald's, the process of making a hamburger is broken down into individual steps, and each employee along the way can be an expert on that part of the process. Someone can be great at adding just the right amount of ketchup. The next specialist knows just how to place the pickles. Then you have the closing specialist who knows how to wrap up the hamburger into a perfect package.
McDonald's does this so that they can hire the lowest skilled workers for each step and therefore can charge a very low price.
When the assembly line system is working as planned, it might be a thing of beauty. But what if a problem occurs? What if the order gets changed? With a personal chef, they know all of the details of what you want. They were there to take your order. You might have said that you want your ketchup on the side. You also like your lettuce below the burger and not on top of the onions.
For the assembly line process, there might not be a place on the ticket to convey those changes. So you end up with something that just wasn’t quite what you wanted.
The team approach benefits the agent, not the seller
A team approach in a real estate transaction is very similar. Let's be real. The team approach usually isn't for the benefit of the seller. It's for the benefit of the top-dog agent who is the team leader.
Agents who are coached on building teams aren't coached to do so to bring the costs down for the seller. They are coached to create teams to free up the team leader's time so that they can be out there generating more new business and making more money for themselves. That’s great for the team leader. Why spend time doing tasks that you can delegate to a person who you can pay less to?
The top-dog agent's job is getting new business, not actually doing the business. These agents go to great lengths in rationalizing the benefits of the team approach to the seller. They sell the seller on having trained specialists doing what each of them does best.
They use the analogy of a doctor. Doctors don't waste their time doing all the paperwork and prepping the patient. They have more important things to do. But what if there was a doctor who still made house calls? Wouldn’t that be nice? Someone who knew your complete story from start to finish. Someone you could talk to when needed and not have to be filtered through a panel of underlings.
There's nothing wrong with McDonald's, if that's what you want and that's what you pay for.
Who and what are you getting?
The larger the agent's team, the less likely you'll spend any time with the top-dog agent who you see in all of the marketing. They finally get to the point where they don't ever have to actually be working in the business. They are on to the big bucks of working on building the business bigger and bigger. They have delegated all of the actual tasks to underlings, and they just focus on managing a company, not doing the actual business.
But how does that jive with all of the marketing that these agents do? The top-dog agent says that they have all of this experience, but if you don't actually get to work with them, so what? You end up getting the experience and expertise of their underlings.
Maybe they play up how good their system is and that it really doesn't matter who you work with. The top dog has passed down all of his wisdom and experience to the others that he has hired and trained. Again, nothing wrong with any of it. Just understand what and who you are getting.
Personal CPA or H&R Block
Here's another analogy. It might cost you $1000 for a personal CPA to do your taxes.
You know them, and they know you. You are willing to pay them $1000 because they have 20 years of experience and you trust them to really know all of the nuances and new changes in the tax code. But what if they pass you off to someone at H&R Block but charge you the same $1000 for doing the same tax return?
Maybe you get someone whose only tax experience was going through the two-month evening H&R Block tax course last fall. You might get the same result, but it's a lesser experience. Do you feel good about paying the same $1000 fee?
Make sure you are getting what you pay for, and you are getting what they are actually promoting.
Make sure you get to actually work with the so-called expert.
Absurd. Comparing company sales with individual agents
One other note. Some agents with large teams make misleading comparisons for number of home sales. They might say that “Joe Super Agent” sold 2000 homes last year while the “Average Slackard Agent” only sold 6 homes.
If you give it two seconds of thought, you'd realize that it's a bizarre comparison.
Maybe “Joe Super Agent” has 100 agents on his team along with a large unlicensed support staff. It might work out to be 15 homes per employee. Is each of the 100 agents imbued with the experience of having done 2000 sales?
Does “Joe Super Agent” even get involved with any sales on a personal basis? Just because a company has a personal name and markets a single person as the expert, doesn't mean you will get any personal attention from that expert agent.
It comes down to the experience and expertise of the agent who you'll actually be working with. Comparing team stats or company stats to the stats of a single agent, is misleading, at least from my point of view.
I have my license with Atlanta Communities. It would be like the CEO of Atlanta Communities taking credit for all of the sales of the over 1000 agents in his company. Would it be appropriate to say that Judson Adamson sold 5000 homes last year so he must be really good? But when you decide to hire “Judson Adamson” to sell your home because he has so many sales, you might end up getting to work with an agent he just hired fresh out of real estate school.
Again, know who and what you are getting.