The Difference Between Good and Great

What is it that makes some agents prosper in this market, whilst others flounder?

Why is it that some independent estate agencies rapidly expand their business, whilst others struggle to grow, despite offering superior service and a passion for results? I know a number of agency principals who have established very successful multi-branch businesses within a couple of years, whilst others who have been in business ten times as long are still managing their original branch.

I believe the difference lies in outlook, not ability. If you really, really, want something to the extent that it is a living daily passion, then it is quite likely you will ultimately get it. Look into the background of any gold-medal winning sportsperson and you will usually find that they started at a very young age and pursued the path to success relentlessly until they had achieved nothing less than gold (OK, let’s have a chat with Tim Henman later). For many sportspeople, being fast, strong and consistent is not enough. That’s not the point. Being great and winning is the point.

I regularly meet estate agency principals who could be likened to the average athlete. Sadly, the average athlete does not win many medals, because average is simply not good enough. Which successful runner decided to maintain his/her best laptime for the rest of their career? In order to win, you have to be great, and recognise the opportunities ahead, not simply dwell on what you know you already do well.

On the basis that other estate agents also do things well, why should you prosper over them? Because you are the best? Don’t delude yourself. What on earth does “best” mean? Can you, in your heart of hearts, really get the highest price in the shortest time? Or is that just estate agents’ rhetoric? ( Strangely enough, these criteria are not why the client actually chooses you on in any event - see my article in July’s Estate agency News). Best means different things to different people, but even if you are regarded as “the best” in your area, it still doesn’t answer why some fantastic agents flourish, whilst others simply survive.

I know many estate agency principals who have built their business on the back of their own ability to win the hearts and minds of their prospects. They know that if they personally attend a valuation they are highly likely to get the business. They know their area backwards, and may well have sold the house in the past. They have high integrity and are passionate about delivering service excellence. Yet they tend only to have a single branch.

These agents, whilst clearly very good at estate agency, are typically not so good at building a business. After all, there is a huge difference between being an estate agent and being a businessman/woman. One appraises, markets and negotiates the sale of houses in order to make money. The other uses key business skills to generate sustainable and increasing wealth. The former often has a full diary and little spare time. The latter appears to be on holiday all the time!

If you are to develop your business into something exciting, you should perhaps make the transition from agency into business. It is a conscious effort to work on the business, as opposed to in the business. Richard Branson is not a qualified commercial airline pilot, yet he runs a successful airline. He’s not a musician, yet he heads up a record store. And a bank, and coffee shops, and insurance, and cars, and mobile phones. I know a number of very successful agents whose background is not in agency, but in other areas of business. These are your competitors, and their objectivity enables them to spot opportunities that many established agents overlook.

Highly successful estate agency businesses could be created from existing branches if only the principal would let it go. “Let it go, and let it grow!” (I just made that up!) Other industry sectors employ people to develop the business, in two disciplines in particular -marketing and training. Marketing develops your external resource - your client base, and training develops your internal resource - your staff. Agencies where the principals focus on these disciplines are invariably much more successful than those where the principal just sells property.

The problem is that there is always the temptation to believe that no one is as able to convert those precious valuation opportunities into listings than the principal. This may be true, but let it go. You can afford to lose the occasional instruction in the name of progress. How many more opportunities would your marketing efforts generate? And how else will your staff develop into mature ambassadors for your business unless you train them to do the job you have always done so well yourself? Of course they may a different style to your own, but so what? Help them and let them grow. Invest in them and watch them flourish. Demonstrate trust and note their loyalty. You are responsible for their future as well as that of your business. These people are your future, and people so often rise to the occasion when they are given leeway to do so. Well-trained, confident agents secure higher fee percentages.

Once your marketing and training bears fruit (results can usually be seen in a matter of weeks) you will enjoy more freedom as a principal. You will have more of the leisure time you deserve, and will be able to start to think about expanding the business. An expanded business provides additional revenue streams whilst spreading risk. And as your personal involvement in the day to day running of the business decreases, so the business becomes more valuable because it is less reliant on a high profile critical individual - the kiss of death for many prospective investors.

At least you have invested the time to read Estate Agency News, and that is surely time well spent. But will it be “that’s all very well, but I’ve got a business to run”, or the start of some grown-up strategic thinking?