You work long hours, six days a week, you’re very disciplined in your approach to work, and you’re successful and enjoy the money real estate sales brings. Are you ready to take the next step to agency ownership?
Your career so far has allowed you to live well, travel, and buy nice things. But lately, you’ve begun to wonder about the ‘what next’. How long are you going to continue working at this pace? What about your family, the future, and the possibilities owning your own agency could present?
Being the best salesperson in your agency might feel great, but when most agents start thinking about starting their own agency, they often balk at the prospect of raising finance, building a team of like-minded, equally committed staff, designing a brand, and establishing all the accounting systems and technologies necessary to found a business.
This is where many of the industry’s best salespeople stop thinking about taking the next step to agency ownership, but founding a business isn’t as hard as most agents think. There are real estate franchises and cooperatives that have the resources to help you make the big leap, but weighing up what might be best for you is another challenge in itself.
So if you’ve found yourself thinking about taking the next step to business ownership, here are the main things you should consider.
Independent or franchise
This one is essentially a straightforward decision, but the devil is in the detail. As an independent, you won’t be paying any fees to anybody and you’ll be free to run your business the way you see fit but you will be on your own with training, technology and branding. As a franchisee, you generally pay a percentage of your sales and property management department’s turnover to the franchisor, but you get the benefit of an established brand as well as the support and training to make the transition from salesperson to agency principal. There are many different models in Australia so it’s important to do your research carefully.
You might be surrounded by passionate staff and have ideas of poaching them to help found your agency. That’s obviously one option but will they make the transition and do you have a plan for their future career paths? Without one, you may not retain the most important assets of your fledgling enterprise. Also, as a new business, your most important challenge is attracting and recruiting quality salespeople and property managers who will help you establish and grow your market share.
Financing your business
Many of the major banks and their competitors offer accredited real estate industry bankers who understand the unique revenue streams of a real estate business. They can tailor streamlined solutions for making and receiving payments, managing settlement and trust accounts, and commercial bond accounts – where interest doesn’t need to be paid to your state statutory authority.
Your choices in technology will surround websites, customer relationship management systems, communications systems, accounting and wages software, and property management systems. There are plenty of alternatives out there but talk to any principal of a real estate agency and you’ll soon realise that the choices you make will affect the efficiency of your business well into the future - and ‘one point of entry’ is the holy grail. You’ll need to set aside plenty of time to research the options out there and understand which systems are best suited to real estate salespeople. They systems that aren’t so well optimised won’t be well accepted by your staff and that’s an impediment you definitely don’t need.
Founding an identity takes more than just phoning a graphic designer and asking for some designs. Branding an agency requires a great deal of thought. You need a central, identifiable visual element that helps customers discover, share and remember your company, then you need to apply that to letterhead, signboards, shopfront signage, promotional literature, flags, pointer boards and digital assets.
To manage or not manage property
A property management department helps provide consistent income, which helps your agency navigate the ups and downs of sales cycles and the human resources challenges you will periodically face. However, buying a rent roll dramatically increases the capital costs of your start-up. On the upside, however, owning a rent roll helps establish immediate local market share and provides an ongoing flow of properties for your sales division, over time. Without doubt, agencies that manage property are more stable and better equipped to survive downturns.
It’s important to have a plan to build the strength of your business over time. Integral to this plan is the ongoing professional development of your staff. The better your staff are trained, the more productive they are and the less risk you will face on a daily basis. However, access to the industry’s best trainers is expensive and finding the right fit for your business can be fraught with difficulty. There are plenty of motivational trainers out there but which of them will actually inspire your staff to make a difference and which of them actually provide grass-roots training?
Marketing and communications plan
Starting an agency requires an understanding of your local community’s interests and frustrations, as well as the opportunities that exist within any existing customer database you may have been building as a salesperson. By using a combination of social media, blogging, video, custom audiences, search engine optimisation and keywords, inbound / outbound communications as well as public relations, you’ll need to aim to craft communications targeted at exploiting key segments of your database and wider community. You need a multi-layered approach that takes into account people who aren’t your customers, people who are or once were your customers (and their friends), and people within your local community who have the capacity to influence others towards your brand and service.
Ready, set, go
By now you’re probably wondering how anybody has ever survived the transition from being the best salesperson to being a business owner, or even leader! But fear not, there’s plenty of support available out there.
First National Real Estate was founded 35 years ago by agents, for agents. Unlike a franchise, there are no long-term membership contracts and we have all the resources and infrastructure you need to get your agency up and running, then into growth with our support. Also unlike a franchise, our members support each other so you can always pick up the phone and speak to other members and our corporate support staff. We have the plans, the technology, a nationally recognised brand and even Australia’s most satisfied customers, according to independent research and ratings agency Canstar Blue.
Talk to a First National consultant about how we can help you take the first steps to building your future as the owner of your own real estate agency today.
Call Debbie Fletcher on 0413 624 307 or visit our website for more information.