Photo from Creativecommons.org by madebytess
Matthew Rathbun is one of my heroes. He wrote with great response. Here’s my effort-
Why do you work where you work? Do experienced agents choose a broker because of the compensation structure, a business model, or are there other reasons? Why did you decide to work there? Why do you stay? Why would you leave?
Why do you work where you work? Do experienced agents choose a broker because of the compensation structure, a business model, or are there other reasons? Why did you decide to work there? Why do you stay? Why would you leave?
June 1, 2008 at 6:42 am
My last brokerage was owned by a publicly traded company. When the housing market hit the skids they fired every managing broker and hired in cheaper. The dingbat that replaced my broker kept calling me kathy, katy, karen, you name it. I would have thought that someone would have handed her a spread sheet that showed her Karen was number two in the company and she should have learned her real name. One day she called me Catherine and I turned to her and said, “Catherine quits and so does Chris”. I was one of the few remaining agents. The rest had crossed the street and followed the broker to Keller Williams.
June 1, 2008 at 6:54 am
I think that most agents come for the compensation structure, but leave because of lack of support of experiences like Chis’ above.
June 1, 2008 at 6:56 am
We left our last company due to its lack of internet presence. We’ve been with this company since 2005 and we have outgrown their technology. They still have a great internet presence and marketing but on our own we’ve done better. They also pretty well leave us alone and we work from a home office 95% of the time.
June 1, 2008 at 7:26 am
The Florida Broker Exam has a question – what causes top producers to leave a firm? … the answer is poor management. I talk to agents every day that tout their commissions but forget that it is often worth a lower split to get a better situation. Where I’ve just hung my license:
1) Everyone in the office is a producer…
2) Everyone in the office is busy…
3) The Broker works tirelessly to generate business and support us technologically
4) Even in this past year, the agents are making more than ever.
5) The broker promises something and always delivers
June 1, 2008 at 7:29 am
I work where I work because I have autonomy to do what I want, I happen to work with my mother (and she wouldn’t change companies), the physical location is great and the commission structure works for me.
My firm is also small enough where I don’t have to worry about one of three hundred agents sullying the company’s name and reputation. I’ve looked elsewhere and the arguments about (slightly) better commission structure don’t carry water with me – there’s more to life than money.
June 1, 2008 at 7:41 am
My ultimate choice and preference, after a couple of jump starts, is working for a company with a broker-in-charge who is available and not competing for floor duty… as well as a more professional corporate structure.
June 1, 2008 at 7:49 am
I love my company and have been deemed “unrecruitable” by other large offices in town. Yes. I am a real estate trainer and a technology coach for my company, but it goes beyond that.
What I love is that it IS a large national company – but you will never see ads for the company, as they would rather spend their $$ on bettering their agents. The available education and technology (for all levels of agents) is awesome. No, not all offices utilize all the tools that my company offers, but it IS there for the taking.
Like any major company, I know there are jacked-up offices around and the business model is not for everyone, but the company – as a whole, is better for ME and MY goals than any other that I have found.
I love that they listen to the issues that agents have and try to head off major problems at the pass. We were being taught how to survive and thrive in a down market for almost 3 years now. This pendulum swing was not as rough as it was for the less prepared. (P.S. Gary is publishing a book called “The Shift” which will be available in a couple months…)
What would it take me to leave? Well, if all the offices in my area shut down, I would move to Austin, TX. I would only leave if all the offices in the world shut down. I am a lifer.
Would I ever go out on my own? No way. I have a split with my company that caps at $21,000 a year. We are at 100% midway through the year. And? There is NO way I could hire a team of receptionists and office staff for just $21k a year. My $$ is well spent, here.
You know… I could go on and on, but I won’t.
June 1, 2008 at 9:09 am
I chose KW for 3 main reasons…1) The belief system from the top down. I was hesitant to get into real estate due to a negative perception I had of the industry. KW was openly on the other side of that perception with priorities of God (whatever that may mean to you), Family (whomever that may be for you), and then business. Not every agent follows that, but it’s in our blood.
2) Business model. I’m not interested in my company dollar going to mass marketing. I don’t care that other companies are more easily recognized. I DON’T want my COMPANY to be recognized, I want ME to be recognized. I prefer KW’s method of turning the profits back to their agents rather than advertising.
3) An atmosphere of support. Every agent is willing to share what is working for them with every other agent. I didn’t sense that in the other 4 offices I interviewed with.
As long as we continue in the KW model, I’d never leave. I’m certain some agents would hate exactly what I love (they want company advertising, they don’t want to share what’s working for them, they want to put business first), so I don’t think KW’s a fit for everyone, but I can’t imagine leaving.
June 1, 2008 at 9:32 am
Oooh, I need the answers to this because all the brokers in my area are trying to compensate for the slow market by
frantically panning through the silt looking for flakes of goldrecruiting veteran agents. Some have even resorted to agent development. Desperate times call for desperate measures.
As a future licensee, I used to think I would choose the broker with whom I had the best working relationship, but these days my priority would be on virtual office support and productivity. I want a broker/mentor who already gets it so that I can model on his or her success and I’d rather be mobile than share a hutch.
June 1, 2008 at 10:59 am
I’m exploring these issues on http://www.Bonzai.squarespace.com — if I was looking to go to work for someone at this point I would choose a brokerage that was fully committed to 2.0, but still using tradtional methods that work, a team effort, supportive, co-operative environment that’s mixes fun and work, a fair compensation plan, technology support, interactive training (micro modeling, role playing) a true learning organization that is nimble and unafraid of change.
I believe it is time for agents to work together as teams utilizing a variety of strengths to deliver superior service more efficiently. Okay, I am participating here, now please give me some feedback at Bonzai 🙂 Just kidding, I’m getting used to the silence and occasional comment (I appreciate all comments) I hope this conversation continues for a long time.
June 1, 2008 at 11:02 am
Mike, would 25 AG points make you feel better? 😉
June 1, 2008 at 11:39 am
compensation is hugely important. It is the whole point of working. I want compensation and a broker who understands when to get out of the way, which is most of the time. I could care less about the tech capabilities or mentality of the broker, as that is my domain. As Bawldguy would probably say, the broker isn’t going to be the reason for my success.
June 1, 2008 at 12:26 pm
I get points? Well, hell, I’ll start posting more often.
Bob, for me compensation is not the WHOLE point of working, plus just looking at the split doesn’t tell you the whole story about potential income.
I understand where you are coming from and I don’t think there is any magic in “broker”, but there is productive benefit in systems that can be put together in companies that perhaps would be difficult for the typical individual agent to put together — some people are good at devising and implementing systems and others are good at being a part of the system but not devising and implementing them – so for many agents it’s a matter a of choosing which system to be a part of that will be most beneficial compensation-wise and professional-wise.
Looking at the split (and i am not suggesting you are saying to look only at the split) is short-sighted if you plan on having a long career, with professional development being a part of that plan.
June 1, 2008 at 1:41 pm
Why do you work where you work? I have been there for 20 years and have not had any problems with the management.
Do experienced agents choose a broker because of the compensation structure, a business model, or are there other reasons? Everyone is different, but for truly experienced agents it would probably be commission structure and availability of support staff
Why did you decide to work there? Lower office fees. (100% commission to the agent and a monthly fee to the broker) No requirement for sales meetings.
Why do you stay? The Broker didn’t make every decision based on trying to steer clear of lawsuits. If you had a case and wanted to fight for something, he supported his agents, even if it meant you might end up in court.
Why would you leave? I wouldn’t unless the management changed it’s hands off approach, or the fees went up drastically.
June 1, 2008 at 2:45 pm
For me there needs to be a balance of competitive pay and good management. I am willing to give a little when it comes to payment structure, for better management and open communication. I would leave is the management changed and the open communication wasn’t there anymore.
June 1, 2008 at 3:10 pm
@Dan- I think that was well said.
I think another source of issues is when an agent feels like they are in competition with their own broker or office. That can come in a thousand forms, but typically it is when the agent finds themselves in direct competition for buyers or sellers with the broker…
How do you guys in bigger offices handle that? Our office of 120 agents is different because our broker does not sell…he simply set up the business to build an environment much like Dan describes.
June 1, 2008 at 3:34 pm
1. Broker integrity
2. Fair commission split vs what the company dollar buys
3. Personal connection
@Eric: If the split is right, it doesn’t matter what the broker does. The issue has always been how many agent commission dollars are cause as a result of the broker/francise dollars the agent pays.
There must be some quid for the pro quo ( sorry, that’s a little Bloodhound lingo). 😉
June 1, 2008 at 3:50 pm
@TJ- Exactly. Ours is a RE/MAX office, #1 web presence, and as a bonus the broker does not compete– and I do agree with that latin stuff you were saying although I am not much for calamari …oh…QUID…grin…I get it. 😉 . Well said!
June 1, 2008 at 4:27 pm
Kathy/Katy/Karen.YounameitChris – How anyone could forget who you are is beyond me 😉
– So would it be fair to say that the relaitonship with your broker was key to where you wanted to be?
June 1, 2008 at 4:34 pm
@Monika – So what do you still like about the office? Is it just that they leave you alone? Or is there not a better place to go? Or do you think that there is nothing out there that would constitute a better place.
June 1, 2008 at 4:42 pm
Yes, Bill. It the relationship was key with about 80% of the agents in the office who followed him. It was a mass exodus. I held on for a few months because of my heavy listing load.
June 1, 2008 at 4:46 pm
@Bob – How is compensation defined in your answer? Are you referring to a commission split or company generated opportunities or opportunities generated by working with an exceptional borker or manager – (For example if you could work with a guy like Russel Shaw, does the compensation include the opportunity to learn ? Or could that compensation be working with Bawldguy and learning the ropes of real estate investment from a guy who grew up in the business?)
June 1, 2008 at 5:08 pm
Bill: awww, if I’m a hero, you need to get out more! …but I appreciate the props
When I was practicing, my issues were integrity of the Broker AND the ability to do my own thing and know the broker trusted me. It was also a issue of my Broker from knowing that on day one, I wouldn’t do anything to hurt the company, but I certainly wasn’t there to promote the company. I didn’t expect the company to get me business and in return they shouldn’t expect me to promote the company.
Was the compensation split a large issue? Affiliation with the company should enhance my business, it shouldn’t be a deterrent. Often a company offering an 80% split doesn’t do me any good if other agents go out of their way to show my listings. After a few years of doing business well, you’ll make a good name for yourself and the company doesn’t matter (actually I am a huge supporter of becoming our own team/broker at some point). However, for agents in the first three years or so, they need to look for a healthy commission plan, education, broker access and support.
A new agent should look for a company where the broker is easily accessible. I don’t care if they give you a mentor – you need someone who actually has experience AND authority to bail you out of an issue, should it exist.
Too often we have agents who call me for help, because neither they nor their mentor can reach the broker and don’t know what to do. Often I can point the agent in the right direction, but advise them to still speak with the broker before taking action, because a lot of this job requires a backbone and my advise may be either more conservative or aggressive based on risk versus reward. Only a broker can make those risk vs. reward decisions.
As far as compensation is concerned, if the split is 50%, but the broker enhances my business with and gives me twice the client base through exposure, support, initiatives, reputation etc… than I am ok, because I may get 10 deals on my own at 80% somewhere else – but 20 deals at 50% is better.
Compensation isn’t everything. A broker can give me 100% split, but if the have a bad reputation in the community and with other agents than it will hurt my business and 100% of nothing isn’t worth anything at all.
The Harriman Team
June 1, 2008 at 5:40 pm
We don’t work for a national company, but we do work for the largest family owner real estate company in New England and the 12th largest in the US. We tried other big franchises (the “P” one and one of the Cendant owned ones) but the atmosphere was too corporate, too snobbish, too cutthroat and too much stab-you-in-the-back. Our current company made us “an offer we couldn’t refuse”, knows how to support, energize and recognize their agents, and makes working there a family-type atmosphere. We were recruited by every major agency in our market (and still are!), but came here mainly because of the relationship between broker and agents and yes, the compensation, too. We wouldn’t leave unless the average temperature in Hell dipped below 32 degrees…or unle$$ the relation$hip we love $o much change$ dra$tically!
June 1, 2008 at 7:19 pm
@Dan – Good points but I have a question – You mention that the Broker leaves you alone but is not so concerned about litigation that he won’t back you up. – Does that make him supportive? I guess I’m asking what the impact is of the confluence of of the broker’s personality and your perception of your needs? 20 Years is a long time Congrats to you both!
June 1, 2008 at 7:29 pm
@Jim – I love your last statement “I’ve looked elsewhere and the arguments about (slightly) better commission structure don’t carry water with me – there’s more to life than money.” And coming from someone as professional eveolved as you are – that has an even greater impact!
@Matthew – I get out a lot – I just recognize talent when I see it 😉
Interesting that you, like Jim, and several others talked about compensation last, and the relationship, tools and support first.
@The Harrimans – I’m seeing a pattern here – productive people are concerned about the environment and if that’s not good then the issue of compensation comes into play (and as Matthew points out compensation and cash earned is not the same as business model or commission split)
Even what’s her name @Griffith mentioned that the exodus (or immigration) of the large number of offices in her situations revolved around the relaitonship and support of the higher quality manager. (C’mon Chris you know I’m a fan) 🙂
June 1, 2008 at 7:33 pm
“Even what’s her name @Cgriffith…” ROFLMAO!
June 1, 2008 at 7:36 pm
LOL You’re both killin’ me. Too funny!
June 1, 2008 at 9:59 pm
@Bill ….Hmm ….”confluence” had to look that one up!
Well the Broker actually passed away a few years ago but fortunately his successor has followed the management style. For me it was simple, he didn’t put a lot of restrictions on me but was always there when I needed to talk about a problem with a client or a deal. He was smart and tough, didn’t take any bull and didn’t give any.
I always tell people trying to decide on a company that the Broker is key. You have to connect and be able to talk about the problems that inevitably come up. When you are new to the business you will need a lot more of that. The Broker that isn’t out selling property himself, but whose only job is keeping the office running smoothly and mentoring agents, is the one you want.
June 1, 2008 at 11:34 pm
I’ve always felt that there are two things that drive you to work anywhere:
1. The people…the culture. You have to love the atmosphere that you’re working in. It has to be conducive to your personality. Otherwise, it’s never going to work! With time you’ll grow frustrated and you’ll ultimately get no where.
2. The resources. Your employer has to provide you the tools for you to perform exceedingly well in your duties. From simple “new hire” training to continued office support. You have to be connected and you continually have to be learning. Otherwise, there’s just no point is there? You need to grow somehow.
Jennifer in Louisville
June 2, 2008 at 5:30 am
Was with Century 21 from 1992 – 1996. Been with REMAX from 1996 – present. The initial draw to REMAX was the commission structure. It made sense financially that once we were consistently selling several million a year, that we could afford to pay the monthly office fees for a higher commission split.
Stay there because the broker really makes an effort to be an industry leader. Staying ahead of everyone else with information, technology, and innovation.
The only reason I’d leave would be if the environment vastly changed – I’m perfectly happy where we are currently.
[Note: Its really up to the broker. Each office even within the same franchise can vary tremendously.]
June 2, 2008 at 2:16 pm
The best company I have been with was my last brokerage, KW. But I left them for financial reasons that no company could have countered. A few people say they wouldn’t leave unless hell froze over or some other silly thing, but trust me you would leave if it meant the difference in getting or losing $100k in extra yearly business, maybe your price is higher or lower but there is a price.
While money isn’t everything we are in business to earn a living.
Services an office provides means nothing to me as I have assistants who do everything that the secretaries would do at most offices. My assistants do a better job then any underpaid secretary will ever do. Plus I have better equipment then any office will ever provide to their agents and we are 100% run out of our home.
If at any point the current financial incentive that caused me to switch appeared to be over with I would move our team back to KW. Mainly because the broker knew to not annoy me with silly questions or requests. Let us do our business and cut my checks quickly.
Eric- New Orleans Condos and Lofts
June 2, 2008 at 9:30 pm
I like the money and know I can leave anytime. The Prudential name is sound and we have market share in the community. Many agents come and go. Got a private office and the a/c works great in the summer. Never have any real needs from the broker in the last 5-6 years.
As long as I am selling 40-60 homes a year I will be fine. No one is looking over your shoulder.I do most of my business in other areas away from my office which is strange. I can stop in the other branches whenever I need to and kow most of the agents in all those offices.
The grass may be greener other places and until my plan is changed I will be happy. Where else can you make this much money in New Orleans.
June 3, 2008 at 9:17 pm
I need to be able to work from home. I need to be able to make my own schedule since I also homeschool. My small office with the Century 21 name lets me do that. I am concerned that I may not get noticed through working with this specific company. They are not techy at all! And I have to stay on top of all my training. But I am expanding my web pressence everywhere! I check on my own education. I keep up with what is hapening on the local, state, and national level.
If there was another well recognized company in the area, I might switch, but for now, being a community agent in a community office will have to do.
June 9, 2008 at 5:00 am
I’ve been with the same brokerage since I started in 2004, and for me it wasn’t money or technology – there are several large brokerages where in all likelihood I’d have received similar opportunities starting out, similar educational settings in which to thrive or die, and good locations for walk-in business and floor duty (of which I’m a proponent, 1/2 of my business my first year came from floor duty). For me, it came down to environment.
I knew that every brokerage would be difficult, as we’re all competing for the same business, so I wanted to be at a place where I knew I could get along with the other agents, yet be autonomous in the way that I ran my business. I wanted to be in a house that provided opportunities, sure, but I wanted to enjoy the people I was working with, and I think we’ve accomplished that. I’ve seen some agents come in that didn’t jive personally, and there have been others that have become great colleagues and friends. Some of the relationships with agents and staff that I’ve formed I’ll have for years, and in a business where every morning we’re starting unemployed I enjoy that camaraderie. If I’m able to run things as I want to, without heavy-handed oversight, and enjoy the people I pass in the hall … I’m happy.
I’ve looked elsewhere, and still get calls from agents who want me to switch and combine efforts, but I’m just not interested. The grass isn’t always greener, and the numbers bear that out. In one instance, if I had left Coldwell Banker and went to a large regional brokerage, I’d have been giving up the CB franchise fee but then would be paying for the broker’s overhead, like individual copies and desk rental. That’s something that’s not part of my current agreement with the CB franchisee, so it ends up being a wash.
Environment … technology … splits … … flexibility … it’s different for everyone, but I’ve really enjoyed this post. Thanks for putting it out there, Bill!
June 9, 2008 at 5:35 am
@Ken- You are right of course that every relationship has a price tag and regardless of how much you like or dislike a broker (age)….that would enter into the final equation
October 6, 2008 at 6:54 am
I started with my first firm because agents with other companies told me that if they were just starting out…they would choose the Broker at this particular office. I was great advice and a great place to train. Unfortunately, the company fell behind with technology and I was feeling frustrated with not being able to advance with technology. I found a company that embraces technology, but unfortunately, is very corporate driven and not agent focused. Someday…….my prince will come…or else I’ll just create a virtual one!