Once it is signed it’s too late to change your mind!

Do I really want the responsibility of managing others?

Am I sensitive to people, their desires, their fears—do I have empathy?

Can I motivate, direct and lead other people?

Am I creative—can I bring new ideas to the sales team?

Do I listen to only what I want to hear?

Do I create an atmosphere where subordinates can express themselves?

Do I recognize that the real strength is in my people—not myself?

Do I understand the principles of two-way communication?

Do I lose my temper when an associate questions my decision?

How much criticism can I take from my people?

Can I make a decision?

Do I realize that my program will not work without complete and eager participation from my people?

Do I treat everyone fairly, or do I tend to have “pets”?

Do I have the courage to carry out company policy—no matter whom it may hurt?

Do I really want to see other people succeed?

Do I understand when I have to be the boss and control my people?

Do I know how to make a profit and develop my business?

Am I willing to pay the price to be a manager?

Do I love people?

Am I a manager or am I being managed by people and situations around me?

This excerpt is from the 1985 Realtors National Marketing Institute booklet

My name is Michael J. Stefonick and I was one of the original RE/MAX Regional Owners who purchased RE/MAX in Southeastern PA in January of 1978 and a few years later the state of Delaware.
In addition I was the first RE/MAX Broker/Owner in PA in 1978. During my tenure with RE/MAX I sold hundreds of RE/MAX Franchises and helped recruit thousands of Agents into RE/MAX.
We had one of the best RE/MAX Regions in the system.
After my retirement in 1999 through RE/MAX International reacquiring my two regions I decided to form a consulting and coaching business to assist both RE/MAX Brokers as well as other companies with their respective business issues.

The Real Estate Industry is in a major decline. Mainly caused, in my opinion, by a very negative press and the failure of the US Government to accomplish or solve any of the major problems it’s citizens are incurring.
Therefore the lack of confidence and their concern for their families future have almost frozen the market in most of the US.
With 95% of the US population who wants to work and having jobs, why would anyone think the world is coming to an end. IT IS NOT!

So what is a Real Estate Brokerage firm to do to survive this deep business decline?

The first thing they should do is to call me at 888-393-1230 and I will listen to YOU. YES LISTEN !
It is more than you will get from most of your Franchise Companies and it will not cost you any money unless you enlist in my GROWTH CONCEPTS COACHING service.

The second thing you should do is to look within and see if you really want to own a company.
Be careful, some of the Franchise companies will not even let you shut it down without paying huge fee’s for what they say is their lost income stream even though you may not even be profitable.

Most Real Estate companies are small business’s owned by very good sales agents who want to control their own destiny.
Furthermore most of these small companies, including many Franchised Offices, are subsidized by their respective owners personal sales commissions.

My suspicion is that most of these independent brokers would like to go back to selling and divest themselves of the headaches, lawsuits, franchise fee’s, and huge operating expenses that drain the business each week.
I have friends who feed their company about $250,000.00 per month. I ask why? They feel things will turn around. One friend who owns a 100% office tells me his agents owe him $450,000.00. Do I think he will ever see that money? NO, but yet he feeds the business every month to pay the Franchise Fees, and the so called Group Advertising Fee’s to further support the Trademark and Lead Generation Programs.
That’s all good if someone is looking to buy a home.
Depending on where your home is it may have declined in value like my cousin’s home in Jacksonville, FL. She bought it for 1.3 Million two years ago and today it may sell for around 800k.

In looking at the bigger picture of where the industry is headed, one must come to the reality that it’s never going to be the same. Can it be a good business? Absolutely! Will the business model change? Absolutely!
The question arises who will make that change. A friend once told me that ” Nothing Changes Until the Pain of Remaining the Same is Greater than the Pain of Change”.

This is what I call a Truism and is not related to a Gumpism ” Stupid is as Stupid Does”.

Change comes when the old business model does not work anymore, or when the management of a brokerage firm must be changed, or when the leadership of a Franchise Company has failed. Franchise companies seem to change Senior Management every 5 years. Leadership in Real Estate is everything. Without leadership the ship will not have a course to follow or attract the agents to lead the charge or carry out the plan for success.
The next thing that must occur is to have the best sales staff. You only obtain those by combining leadership with a great compensation package. RE/MAX built a huge company with that model.
If your willing to pay someone 100 % of a specific commission your going to get someone’s attention. If your willing to pay them more than 100% you really have their attention.

THAT IS THE BUSINESS MODEL I DEVISED YEARS AGO AND IT HAS WORKED EVER SINCE.

If you are looking for answers on how to grow, sell, merge, your real estate business I would welcome your call.

If I can’t help you I will tell you. If I feel I can then it just may be the best call you’ll make this week.

Wishing you every success the industry has to offer!
.

Others lived in denial and thought things would turn around and did not cut back on overhead.
Unfortunately those firms are now in a panic with many closing down permanently.
Some can now be seen giving their franchises back to their respective Franchisors and finding a new affiliation.

Some Brokers and Agents in Florida are heading North to the Charlotte market. It is only one of a few markets actually showing growth.

It has been said that nothing changes until the pain of remaining the same is greater than the pain of change.

The demands put on some franchisees as it relates to affiliation or contract renewal fee’s have taken it’s toll.
The cost of doing business and the cost of keeping unproductive agents have become truly unbearable.

Vendors such as the NAR Realtor community and MLS organizations have raised dues to their memberships in a time when they can least afford it.
While some feel it’s important to continue the same cash flows earned in previous years knowing that there is a fall out on membership, they don’t want to take a pay cut or share in the suffering of it’s membership.
The MLS’s want more revenue so they can keep merging and paying ridiculous salaries to their CEO’s and staff.

The good news is that we are now witnessing the emergence of the State Wide MLS Movement I referred to in previous blogs. It must happen and it must happen soon. The Real Estate Industry is now going through the fastest adaptation of transparency in it’s history.
Look around, so many services on the internet are FREE. Yet the Realtor community wants to eat it’s own for dinner.
I’ve said it before and I will say it again. Google could buy every single independent real estate brokerage company in the United States tomorrow and become the most powerful competitor that Realogy, RE/MAX, or Prudential has ever seen.
I would go so far to say that many existing Franchisees’ would jump ship in a heart beat at contract renewal time to be with a Google or Yahoo which could be Microsoft and Microsoft could buy Yahoo and Google could buy Microsoft. Think about that!

In this day and age anything is possible!
Certainly this would be much better than a bank getting into the business. After all it was the greed of the lending institutions that created the sub-prime fiasco.

Intellect Matters and the Search Engine Kings have it all.

It is not will it happen but when will it happen.
With the massive loss’s reported by the Real Estate Franchise Operators you may see something transpire by the end of the year.
Asset values are dropping within the Real Estate Companies as well as the Venture Capital players who have funded buyouts such as Realogy.

So having said all that, only time, pain, bankruptcy and suffering will tell the real story. After all look what happened to Bear Sterns this past week.

The crystal ball is clear and shinny. He who wants to look into it can realistically see a solution to what real transparency can provide the Real Estate Profession. A business without barriers providing cost savings to the public and Real Estate Brokerage business. Once this evolves the Realtor organization would have no conflicting relevancy at that point. They certainly do not need a Credit Union and would not need Realtor.com and all the loss’s incurred by past corruption and management incompetence.

In closing this Blog I really do believe there is room for the Independent Broker in the business as well as the Single Office Operation.
I still have clients earning 7 figures in this market. The reason being they had not let their ego cloud their business objectives.
They are true leaders and their success is a direct result of the concern they have for their agents.
After all a Real Estate Broker is not in the Real Estate Business, they are in the Sales Associate Business.
The Agent is the Customer! Without the Agent there is just a one person, the Broker and maybe a secretary.

By the end of 2009 the market should start to move up again. Let’s work now to attack the problems impacting our business and view the future with a clean slate. The buying and selling public will always need the service of good professional representation. Perfect your services now so you can be there for them tomorrow.

If you looking for great customers they are everywhere. My job is to teach you how to find and capture them for you company.

If you are looking to grow and not just survive call me.

Michael J. Stefonick

610-659-1173

What we are witnessing is the slow transition of the real estate business from the Mom and Pop independents to the major players, the huge well funded independents.

The small Franchisee’s are just as vulnerable as the independents. Maybe more so due to the continuing Franchise fee’s that must be paid irrespective of sales or no sales.

With operational costs soaring and unit sales on the decline, only the well-funded Broker can survive this market.

Here is my advice to the broker who wants to make it to the next upturn.

Consolidate your branch offices to cut your overhead and do it Now.

Renegotiate your office leases to cut overhead NOW.

Don’t make plans to go to the next Realtor Convention because they won’t save you.

Save the airfare and hotel cost as well as the over priced registration fee’s.

Rethink what you really want to accomplish with your company.

Now is not a good time to sell unless you are going under.

The best way to protect your company is to grow your company.
Recruit more productive agents from the offices that are closing shop.
Show those offices that it’s better to merge than just close down.

Obtain mailing lists from those closing offices and then use those lists to recruit other agents by giving them a client list.

Utilize more free advertising such as the many Free Internet listing companies.
IE: Yahoo, Zillow, etc.

Rebuild your Website to include more satisfied customer testimonials.
There still is a need for many to buy or sell a home. Let them see how easy it is to do business with your firm.

Review your competitors websites and make yours better by making it more user friendly. This is one of the best things you could do.

Feature your agents in testimonials that tell of the success they have had in
serving their clients while associated with your firm. All of this should be on the website.

Don’t buy a new car!

Shop for better Insurance rates for your office building.

Stop lending your agents money, you are not a bank.

If you need other idea’s feel free to call me at 888-393-1230, I’d be happy to help.

Just 3 years ago hundreds of thousands of additional people became licensed to sell Real Estate. Each thinking they would either make an easy buck part time or succeed in a business that would have no top. Anyone who has been in the business 10 or 20 years or longer knows that the Broker who owned a Real Estate Company was the one who would coach the firms new agents. Why? Because he or she actually listed and sold Real Estate Successfully. They wanted to train someone in a culture that could not be duplicated by an outside trainer.

A public speaker who has vast experience in selling real estate is not necessarily a coach. They speak to hundreds of agents at a time and sell thousands of video’s or tapes a year. They serve a great purpose and convey idea’s that the masses can benefit from. Agents who attend these seminars can only absorb so much information. If they can take the notes down quickly enough they may find the time to read them. The good news is that if they can implement one idea from the seminar it was worth the price of admission. I have many friends who are truly fantastic speakers and they deserve every penny they have earned.

If you search Google for Real Estate Coaches on the internet you will now find so called Coaches who don’t have a history of success in the Real Estate Business. Many could not make a living listing or selling and have reinvented themselves into being a so-called expert. I know a former office manager who could not live up to the owners expectations and is now out there representing himself as an experienced and successful recruiter and office manager. Nothing can be further from the truth but then again with the right recommendations from a few prominent Brokers I am sure he will pick up some clients. People gravitate to their own level of incompetence.

Are there successful Coaching Companies out there? You bet! Notice I said Successful. Are some of these companies making a fortune? You Bet! You can rest assured they are not coaching one on one. They are hiring people who can read script and ask how many prospects did you call today. Can they answer real questions about the nuances of the business, I think not. What is the phrase? Fake it until you make it!

In prior Blogs I wrote about how an agent should interview with a broker. A key question they must ask when interviewing is to point blank ask if the company is profitable. Recently you may have read that a larger franchise company in AZ with 13 offices closed their doors. I wonder how many agents they recruited within the last 6 months. What decision would those agents have made to join that company if they knew the company was not profitable? Would they still have gone with that firm if they know the company could not pay their overhead expenses? Some key questions you would ask a Coaching Company is will I receive the service of the person at the top? Will I always be speaking with the same company representative or are they rotated? How many years have they been coaching and what Real Estate Experience do they really have? Are they willing to offer a money back guarantee for their services? Do they require a contract? All legitimate questions.

What is the real value of a Coach? It has been said many times that Knowledge is Power. I maintain that is not accurate. If knowledge is power why do so may agents and brokers fail? The real statement should be ” Applied Knowledge is Power”. A coach attempts to assist someone to think through a process or concept and then develop a plan to implement and execute that idea. If successfully implemented then the Coach adds significant value to the relationship. What is the true value of a Coach if he or she can show someone how to add 10 or 20 agents to a company? How about 100 agents? Now we’re talking big bucks. That is what a good Coach can help a Willing Broker accomplish.

If you’re looking to build a successful real estate company call me for a free consultation and lets see if we are compatible.

It was a war unto it’s own in the Real Estate and Building Business.
The good news is that reality has set in for many Real Estate Brokers.

Many got caught up in the over expansion movement of 2005 and 2006 and have had their clock cleaned in 2007.
That is what I mean about reality sinking in.

Now that the dead wood of non productive agents are being purged, brokers are looking for a new beginning.
It can be a new reality if you play your cards correctly.

Take a moment and sit back and close your eyes and visualize what your company can and should look like for the new year.

Will it just be status quo? Or will it become the company it can and should be?
A dynamic exciting and profitable place to work.

Change can occur and if executed correctly, produce the new beginning all Realtors want.
View your competitors through someone else’s eyes and see where they are falling down or doing something right!

It is easy to make it to the top 10% of the Brokers in your market place.
Just take a look at the top 10% of your competitors and adopt 1 of the best idea’s from each one. It will not take long to move up the ladder.
Does it take money? In some respects it could however the biggest advance up the ladder will come from the attitude of your agents and their desire to assist you in re-energizing and reinventing your company.

Make certain you have focus group meetings to listen to your agents and ask them what they want, need, or do not want or need.
Is there waste in some offices? You bet. Maybe spending money on certain advertising has not paid off. Why continue the ad just because it was something you always did.
You may want to revisit your overhead and fee structures.
There are many brokers out there who still do not factor in service fee’s or transaction fee’s.

Depending on your market Cable TV may be a possible option. Maybe You-Tube will work for you. It’s different and youthful.
Gaining name recognition with the youth of today is your customer of tomorrow!

Give it a try, you just might be surprised with your own success.

If you are associated with a Franchise Company be certain that everyone has their logo shirts or lapel pins. Show pride of affiliation. The agents who do not wear those items are really telling you something. I bet you know what I am saying here.

In closing do not fear the 2008 market. People will still be buying and selling homes. Keep your agents updated on the new things happening on the Internet and Blogs. Be sure your office technology is easy to you and stable. Look into services like jott.com, wiseagent.com or realping.com , and youmail.com. These are all productivity services and two of them are FREE.

If you have any questions on these services just call me at 888-393-1230

There may come a time when Real Estate Brokers will want to retire or just want to leave the business due to economic or heath issues.

The question of company valuation will have to be addressed.
There are many factors that must be considered in determining company valuation.

Here are just a few examples:
• Is the company profitable?
• How many years has the firm been in business?
• Does the company have a defined database of past customers?
• Is the company associated with a Franchise Organization?
• If the company is a Franchise what is the Transfer Fee?
• Are there multiple transfer fees for each branch office?
• Does the Franchise Company have an option to purchase?
• If it is a Franchise what is it’s ranking among the competing offices?
• Is the real estate office leased or owned?
• What is the present company market share?
• Are any additional ancillary businesses included in the sale?
• What is the average productivity of the Sales Agents?
• How many agents are associated with the company?
• Will management stay for a determined time after the sale?
• How many sales agents will stay after the sale?
• What is the relationship with the state real estate commission?
• How many E & O claims has the company incurred?
As you can see there is much to think about.

A key question is profitability. If a firm is not profitable then we know that the seller has a motivation the buyer can either accept or decline. There lies the Good Will Factor. How do you put a Purchase Price Multiple on a Negative Net Profit? Can it be done? Yes!

It just may be that the buyer will pay a price to merge it into their current company or to just shut the competition down . The negotiating skills of both the buyer and seller will ultimately determine the value of the company.

If you need assistance for further input on buying or selling a real estate company call me for a free consultation at 888-393-1230.

Why do I want a franchise?

What is your motivation?

Is it Control or Ego?

Is it to earn more income? If so how much?

Do you really want the responsibility of managing others?

Am I willing to pay the price to manage others?

Am I an effective communicator?

Am I perceived as a leader who can be trusted?

How much empathy do I exhibit for other sales associates?

Can I make a decision?

How many years are you willing to wait before the business breaks even?

Do you really understand business even though (more…)

In many parts of the country it is, however there are many markets whereby Realtors are not sitting still or rolling over. The smart Realtors are merging with the weak brokers and picking up more and more market share. Now is the time to grab market share by finding those offices that have solid seasoned agents with good referral bases. Agents are the key to building a successful Real Estate Company. Brokers get into trouble not because they don’t have good agents but because they over extended themselves with investments and building monuments to themselves. So when a broker says they will give you their franchise or company you have to know they will give it to someone, it might as well be you if your cash flows warrant such an endeavor.

Most offices with an agent count of 25 or less are typical candidates. The odds are the Broker only started the company to have some agents assist in covering the cost of the overhead. They really would love to go back to sales. Why not give them what they want.

Now is the perfect time to start your negotiations. Let them start the New Year on a clean slate.