”Denial ain’t just a river in Egypt.”

By
Real Estate Broker/Owner with Benchmark Realty LLC

"Denial ain't just a river in Egypt."
•-       Mark Twain

  With today's changing market, the traditional broker model is bankrupt.  Denying it doesn't make it less of a fact.  Just in Nashville alone, 4 major agencies have either shut down or consolidated from multiple offices to just one within the past week.

 Why?  Because our industry has changed forever and the traditional broker model is refusing to admit it.  The consumer has driven this change and the real estate agent must respond or die. 

 The market data that used to be the linchpin of our job security is now broadcast all over the internet, free and available for anyone to obtain.  Even the legal forms we use are available online for minimal cost.  All of this has had a HUGE negative impact on your value in the consumer's eyes.  Without a studied response, we are in serious danger of becoming irrelevant.

 So what do you do?  Adapt and modify.  Change your marketing, change your offering, change the public's impression of YOU.  Disassemble the parts of the real estate process, focusing your marketing on those portions that are still in demand and killing out those that are not.  In other words, you must give the consumer what the consumer wants.  Or face the consequences.

 Yet in this changing environment, the traditional broker model handcuffs you to antiquated business practices.  You can't alter your offering, you can't adjust your commission, you can't really even change your marketing approach without asking your broker first. 

 You can't, you can't, you can't...adapt and modify without broker approval.  And what is the broker most concerned with?  Covering his overhead.  Too much brick and mortar sets the bar too high and forces brokers into decisions that hurt YOU.

 So you push back, demanding more "stuff" for the restraints placed on you and the portion of income the broker demands from you. 

 Yet in this back and forth, how does the consumer win?  While we are fighting amongst ourselves, the companies that ARE focused on giving the consumer what they want are gaining serious ground.  That ground used to be our exclusive domain, but we took our eye off the ball.  The next day Zillow was born.  Ouch!

The only way to combat this encroachment of territory is to regain your focus on the consumer.  Yet the only way to truly refocus on the consumer is to free yourself from the antiquated, limiting beliefs perpetuated by the traditional broker model.  You MUST have the freedom to respond to the consumer, to react to the marketplace, just like every other independent business person in the history of this country.  And you cannot do that under the traditional broker model. 

 Benchmark Realty passionately believes that your business is YOUR business.  We believe that you, as the owner of YOUR own business, should have the freedom to adapt and modify YOUR business plan as YOUR market demands.  We believe that the primary key to success is YOU, not the broker's overhead. 

 We offer 100% commission with no franchise fees, no desk fees, no broker splits and as much autonomy as you want.  Our award winning broker is here to advise and mentor as you need but we do not constrict your growth by demanding unnecessary meetings or unnecessary payments.

 It's YOUR business!  Invest in it, grow it, earn from it.  And we all win in the process.

Comments (59)

James Wexler
wexzilla.com - Scottsdale, AZ

in financial stormy times there is usually a flee to quality, the big brokers who are offering a service, not just listing homes, should survive

Nov 20, 2008 01:17 AM
Pam Simpson
Bob Leigh & Assoc., LLC - Senatobia, MS
GRI, Broker-Assoc.

Phillip-thanks for the insightful post.  I have been giving my business model a lot of thought and agree that you must adapt to change or be left wondering what happened.  The portion of your post that lept out at me was to examine the process and focus on those portions that are in demand.

Nov 20, 2008 01:40 AM
Phillip Cantrell
Benchmark Realty LLC - Brentwood, TN

Hello all,

It's been amazing to me that so many people have responded to this post with messages ranging from raving fan to downright anger. I didn't ask for the feature spot, the folks at ActiveRain did it based on content.  And the sole purpose of that content was to generate interaction and to motivate as many people as possible to THINK about the direction of their business.  One commenter said something about "needing to have my points taken away".  Here's a news flash...I couldn't care less about points.  My motive was to generate discussion, and in so doing to better this industry.  We spend way too much time posturing, positioning and hanging around the office thinking we are still in corporate america, while the consumer flounders.

You guys are absolutely correct, the information glut on the internet is not a threat, but it has changed the role of the agent.  Our value is no longer in being information provders, but in being information interpreters.  And the agent cannot be an effective interpreter unless they invest in their business to expand their skill set and knowledge.  Otherwise they become a tour bus driver or paperwork shuffler - two things that consumers will no longer pay for. 

Also please note, I never once said a single thing about reducing commissions.  I did stress the importance of adapting to a changing market, plain and simple.  Accept the message or not, you can't change the facts.

Phillip

Nov 20, 2008 01:46 AM
Anonymous
Anonymous

I have read the book Denial Ain't Just A River in Egypt.  And one of my favorite cartoons in it is a full page one that says, "Your mind is like a dangerour neighborhhod, don't go there along" 

Your thougs are right on.  Instead of isolating and hanging on to something that is disappearing, we need to come up with creative ideas.  Test out these ideas in the real world. And social groups like ActiveRain are great ways to stay aware of trends and share creative approaches.  Thanks for the perspective this morning!

Nov 20, 2008 01:49 AM
#42
Ann Dail
Baton Rouge Area Homes, Louisiana, USA, 225-761-0551 - Baton Rouge, LA
Broker/Realtor,CRS, ePRO, SRS, B.A.Chem

P.S.  Somehow I got logged out just as I was sending the above coment....sometimes am technologically challenged..  Ann Dail

Nov 20, 2008 01:52 AM
Renée Donohue~Home Photography
Savvy Home Pix - Allegan, MI
Western Michigan Real Estate Photographer

I think it is important for agents to decide which brokerage best fits their business model.  I am a BIG believer in smaller brokerages that are a little more particular with who they pick. 

I made a decision to move almost two years ago and never looked back.  They supported my business model while my old brokerage did not.  The best training you can get is not in an office, it's in the field.  I tell people to put a business plan together, figure out what they want before they shop brokerages and then find mentors to help you support your business plan and keep you on track!

I don't like corporate restrictions on growth.  We saw some very biggies fall here in the valley when our market tumbled.  The overhead and franchise fees will hurt in the end!

Nov 20, 2008 02:20 AM
Debbie Summers
Charles Rutenberg Realty - New Smyrna Beach, FL

Phillip - I have a constant internal debate going on about the "business models"...  I really enjoyed your post.

Nov 20, 2008 03:22 AM
Kris Kombrink ~ The Kombrink Team
RE/MAX Excels - Chicago's Western Suburbs - Geneva, IL

Good post Phillip.  You paint a very accurate picture here.  Our office was #1 in our marketplace for several years only to slip recently due to the market.  Broker/Owners need to take a look around and ensure they provide the best bang for the buck.

Nov 20, 2008 04:23 AM
Jason Fleming
Jason Fleming Agency INC - Coon Rapids, MN

This is a great post Phillip.  You got what you wanted, to generate discussion about this topic. 

Nov 20, 2008 05:14 AM
Bill Gillhespy
16 Sunview Blvd - Fort Myers Beach, FL
Fort Myers Beach Realtor, Fort Myers Beach Agent - Homes & Condos

Hi Phillip.  Your message of change is timely.  Your conclusion is probably premature or based on a false premise.  Many of the business models you refer to ( including K-W locally ) have had a very rough time.  I keep hearing from customers that they are concerned that those models are not effective and may leave them in a lurch !

Nov 20, 2008 06:37 AM
Larry Estabrooks
Independent Real Estate Agent - Moncton, NB
100% representation means NEVER DUAL AGENCY !

Phillip here is my comment.
The future for a licensed salesperson wishing to become a true real estate professional is to obtain their agent/broker license. With a top level license one can work alone and/or negotiate affiliations with any other agencies/brokerages. Let the big agencies/brokerages manage the herds of salespeople who always seem to be coming into or sliding out of this profession.

Nov 20, 2008 07:37 AM
Sean Carroll
The Get Off Your A$$ Academy - Manhattan, NY
Real Estate Speaker and "Expert" Coach

consumer centered service and not self centered service or broker centered service will always prosper.

Nov 20, 2008 07:39 AM
Dawn Wiser
Century 21 Exclusively - Wenatchee, WA

I feel lucky to be in a small community that is behind the times!

Nov 20, 2008 07:47 AM
Anonymous
Not Yet Licensed

We offer 100% commission with no franchise fees, no desk fees, no broker splits and as much autonomy as you want.  Our award winning broker is here to advise and mentor as you need but we do not constrict your growth by demanding unnecessary meetings or unnecessary payments.

Hi Phillip,

It sounds good for your agents, in theory.  However, I'm puzzled how you make it work.  How do you pay your bills and earn enough profit to keep the doors open?  Your Wal-Mart example is not very encouraging to ponder as the future of real estate.  My clients would be much happier if your business model was Nordstrom.

Respectfully,

Bruce

Nov 20, 2008 08:56 AM
#53
Anonymous
Regina P. Brown

Phillip,

I agree that everything is changing and we must adapt.  At first I was very opposed to CA going to a state-wide MLS system.  But it looks like it's going to happen, and probably very soon, so I am finding ways to embrace the change. 

Like you, I realized that the business models must change to be competitive in today's market; and after a lot of research, prayer, and careful consideration, I joined Allison James Estates & Homes.  It's a nationwide company that discards the brick-and-mortar office for a virtual work-at-home office (which most agents do anyway). 

It seems too good to be true, but when you look at it, the overhead is so low that it's a actually profitable business model.  So the agents keep 100% of their commission in exchange for a small monthly flat fee - no hidden fees.  It's a "green" business because all transactions are done electronically -- you are right, it's definitely the wave of the future.

Nov 20, 2008 10:05 AM
#54
Regina P. Brown
MBA Broker Consultants - Carlsbad, CA
M.B.A., Broker, Instructor

Oops sorry I wasn't logged in when I made my comments above... So now I'm logged in and you can find me on ActiveRain!

Regina P. Brown
Allison James Estates and Homes
www.ReginaBrown.AllisonJamesInc.com

 

Nov 20, 2008 10:42 AM
Anonymous
Phillip

The only comparision I can say to you Bruce is who has the most money? Nordstrom or Walmart.  Compare the balance sheets and you'll see that Walmart could buy Nordstrom 3 times over...without a government check to help.  Ego must dissolve as we serve the consumer.

To Regina I would say, beware of Florida companies.

Phillip

Nov 20, 2008 11:25 AM
#56
Regina P. Brown
MBA Broker Consultants - Carlsbad, CA
M.B.A., Broker, Instructor

Phillip, thanks for the heads up...

But I personally know the President and have worked with him previously.  He is a person of highest integrity, as are the other founders.  Believe me, I did my due diligence on Allison James Estates & Homes first!

Nov 20, 2008 11:36 AM
Esko Kiuru
Bethesda, MD

Phillip,

Change is constant. Sometimes it moves faster than at other times. With the growth of Internet real estate and mortgage industries have transformed a lot already and it'll continue on that path.

Nov 20, 2008 02:00 PM
asd asdasd
asdasd - Albany, NY

"In other words, you must give the consumer what the consumer wants."

What is it they want now that they didn't want before?  I haven't been in this biz for 20 or 20 years so I would like to know from people who have been.  With the market info and legal docs all online now, what can we offer that they demand?

Nov 21, 2008 12:09 AM