I couldn’t begin to estimate how many times real estate agency leaders have commented about another team saying something along the lines of, “She is lucky – she’s got a great team”.
It’s almost as though they think that all you need do is stick your head out the window and whistle, and winners will come running. You don’t whistle for winners, and luck has nothing to do with building a winning team. MORE
The first step to building a great team is to commit to doing so. It requires hard work over several years to develop a team of peak performers.
After commitment come systems. Your recruitment program must be systemised, methodical, and stringent.
It’s crucial you get this right. You can lose a lot of money very quickly by paying salaries to salespeople who don’t make it. Your recruitment process must help you identify likely winners and reduce the risk of hiring those who won’t make it.
And if you think that commission-only is the best option, let me ask you one question: “How has this worked for you so far?”
Attracting commission-only people is no easy task. Unless they are competent, write great figures (most don’t), and are paid a fair split on the commission – a split that allows you to cover expenses and still make a profit – you will lose money on them, too.
If you want to build a winning team, don’t think hiring, think RECRUITMENT.
The Business Dictionary defines hiring as:
The act of giving someone a job; an employer taking on a new employee.
Building a team of competent winners requires more than that.
Here’s the definition of Recruitment:
The process of finding and hiring the best-qualified candidate for a job, from within or outside the organisation, in a timely and cost-effective manner. It includes analysing the requirements of a job, attracting candidates to that job, screening and selecting applicants, hiring, and integrating the new employee to the organisation.
Recruitment is a systemised process that weeds out unsuitable applicants and assists in selecting those who are most likely to make it.
Here are the elements of a successful recruitment system for real estate salespeople:
If you are too busy selling real estate, you will ignore recruiting, recruiting systems, and leading the team. This is sure way to build a mediocre team, if indeed you build a team at all.
Would you take on a seller and not nurture that relationship, consciously moving the listing toward a sale?
Then why would you take on a recruit and not nurture that person, working him or her toward greatness?
You don’t whistle for winners. But they are out there, waiting for you to attract them.
When a team shows little regard for training, that lack of regard eventually manifests as poor results. In this short leadership session, real estate agency profit consultant, Gary Pittard, explains that you don’t train for the sake of it – you train to WIN.
I was talking with a Diamond member of Pittard’s Winners Circle recently. The topic came around to telling sellers the truth about the likely selling prices of their properties.
This million-dollar producer said, “I tell sellers that in this market their properties will sell for $x. If they aren’t willing to price near that, I won’t take on their listing.” He hastened to add that he explains this to sellers more tactfully than that, but his point is that sellers must be told the truth about the likely selling price by their lister. MORE
“It takes courage to tell the truth and jeopardise the listing”, I said. The top performer replied, “It’s more a matter of integrity”.
Of course, he’s right – avoid the truth, or alter the price to win the listing, and you tarnish your integrity and your reputation. So why are agents known for lying about the price, or lying by omission and avoiding price completely?
The answer is skill. It takes superior presentation ability to tell the truth in real estate and still win the business. If you intend telling the truth – and you should – you’d better be an outstanding presenter. And I mean outstanding.
But there are rewards, aside from the well-being that comes from knowing you tell the truth.
As an example, I attended an auction where the agent quoted $4.5 million to the sellers at the listing, and $3.5 million to the buyers during the open homes. He came unstuck when there was only one bidder at the auction. Now he had a $1 million gap to negotiate. Trust me when I say that he wasn’t that good a negotiator. It was passed in.
The property eventually sold for around $4 million, which was about the right money, but it could have sold months earlier had the truth been told at the beginning. And although the agent made this sale, will the sellers ever use him again? Will the buyers sell with him when the time comes? I don’t like his chances.
You see, integrity matters. You can’t be honest most of the time – it’s an all or nothing concept. Sure, it takes tact and finesse to deliver it, but the truth is an underrated sales tactic.
Why take on listings that aren’t going to sell? Why take on sellers that won’t listen to the truth, who don’t trust agents anyway, and who price so high that nobody enquires? Why take on sellers who aren’t serious, who consume your time, energy, your company’s money and your morale. When they leave to go to another agent, they don’t even sincerely thank you!
Even if you use the sellers’ money to pay for advertising, rather than your company’s money, it does your reputation no good when you take clients’ money and fail to sell the property.
Perhaps your market is so hot that properties sell anyway. But it won’t always be like this.
In this short sales session, real estate agency profit consultant, Gary Pittard, explains that while agents must look and act professionally, true sales success is not about looking flashy, but backing up ‘show’ with substance.
Leaders often think that the cost of having an incompetent salesperson on the team is the wage paid to that person. But there is a lot more to lose. The salary is just the beginning.
Let’s say you pay $50,000. In Australia you add 9.5% superannuation so now you’re at $54,750. For this exercise we’ll ignore payroll tax and other on-costs. MORE
Business lost through incompetence
Now let’s look at loss through incompetence. Is it reasonable to expect that an incompetent salesperson will lose 1 listing a month? That’s conservatively 6 sales lost per year. At an average selling fee of $15,000, that’s $90,000 per year. Add that to the lost salary and now your losses are $144,750.
In 1993, the average production of a salesperson was $135,000. In 2019, despite a recent boom, there was no evidence that it was much higher. It’s fair to say that incompetence is alive and well!
It is easy to dismiss these losses because you never see the money. Only the salary is money that you had, and then paid to your incompetent salesperson. You never had any of the other money, hence the tendency to not take it into account.
But you’d better believe that this is real money, even if you didn’t get it.
Imagine I walked into your office with a briefcase containing $145,000. I tell you that this money is all yours at the end of the year, BUT I will be deducting the equivalent of one selling fee every time I detect business lost through incompetence by one of your salespeople.
A salesperson walks into the office after two hours on a listing appointment. “Did you get it?” you ask? He replies, “No, but I’ve got a good relationship with them. If they list with anybody, they will list with me”.
And right then, I reach into your briefcase and remove $15,000. Would you believe then that incompetence is costing you real money?
This is the point – money you had, but lost, always hurts more than money you missed out on, but never saw. It’s the same money, and it buys the same things, IF you can get it.
Four incompetent salespeople can easily cost an agency $600,000 in expenses and lost income. Do you want some of this for yourself?
Then train your people. Make incompetence a thing of the past in your agency.
In this short leadership session, real estate agency profit consultant, Gary Pittard, explains that a team will never exceed its leader’s public expectations of the team. If the leader aims high, the team will do likewise. If the leader has low, or no, expectations the team will almost certainly be mediocre.
Great expectations lead to great results.
Agents who inflate the likely selling price with sellers in order to win the listing – who ‘buy the business’ – might get away with it during a boom market, but in a down market this horrible practice no longer works. Many agents paint themselves into a corner.
In our sales program, Winning Ways – A Smarter Sales Career, we teach real estate salespeople that when an agent quotes two figures to buyers by way of a range, the lowest price in that range becomes the de facto list price. MORE
Say an auction property is passed in with only one bidder. The sellers’ reserve is revealed to be $4.5 million but during the inspections buyers had been quoted $3.6 to $3.8 million.
The agent that quoted $4.5 million to the sellers while quoting $3.6 to $3.8 million buyers now has a negotiation gap of $700,000 at best to $900,000 at worst.
The agent has created the self-imposed problem of The Impossible Gap.
Let’s be clear: if you are not a good enough negotiator to tell the sellers the truth at the time of listing about their likely selling price, and take on the listing on a foundation of honesty, you are not good enough to negotiate a $700,000 price gap, especially in a down market.
No doubt I’ll be howled down by those who say this practice is not widespread, just a strategy used by a few ‘bad apples’. But let’s get real. In Victoria, many high-profile cases have seen agents fined hundreds of thousands of dollars for this practice. One day NSW and QLD will follow suit, if they are serious about stamping out the practice.
But integrity aside – from a salesperson’s perspective, why would you resort to tactics that create a no-win situation for you and your clients?
The truth is a wonderful sales tactic if you know how to deliver it with tact. I cannot recommend it highly enough.
In this short sales session, real estate agency profit consultant Gary Pittard explains that closing is not like a Wild West gunfight, with six shooters at ten paces and only one walking away. There is nothing adversarial about closing. In fact, it’s the opposite.
Closing is the simple act of helping somebody make a decision. But before the close, there are important things that must be covered if you want to lead the client to the right decision.
Struggling salespeople – we’ve all had them. They can be frustrating, and they can cost your company a lot of money. So how do you know whether to persist with them or fire them?
In 25 years as a real estate agency profit consultant, I have seen entire teams of strugglers who fail to reach an acceptable performance.
Why do leaders keep such people? Some leaders wrongly believe that inconsistent or poor performance is just the way it is in Sales. But I can show you many Pittard clients who have incredible teams of happy, peak performers. MORE
You can have this too, with some systems, leadership and determination. Poor performance is not a fate accompli. You can – indeed you must – do something about it.
The key to dealing with strugglers is to know which ones you have a chance of turning around. There are only two types of salespeople: the right people and the wrong people.
Identifying the right and the wrong people is easy.
The right people:
The wrong people are the opposite. These must go. You will never turn these people around, so don’t waste your time trying.
Four steps to turn around struggling salespeople
When you have identified the right people and removed the wrong people, it’s time to begin the turnaround.
First, get your struggler to train hard. Help them set a study program designed to improve their areas of weakness.
If they have difficulty listing, work on their listing presentation. If they have trouble coming to the point, drill them on succinct communication.
Second, test their knowledge. There is no point increasing their level of actions (step three) if they can’t do them competently. Constantly test them on what they’ve learnt.
Are you seeing improvement? If not, they either aren’t studying, or they aren’t absorbing. Either way, you have gone as far as you can go with this person and it’s time to terminate their services.
As their knowledge improves, so will their results, but this is only half the battle. You must increase their actions. This is Step Three.
Get them working hard on the right actions. Work with them to formulate a plan. Get their commitment to follow the plan.
All salespeople, but especially rookies and strugglers, must have a plan and must follow it. They must know where their business will come from, particularly where they will find their listings. How many people do they need to speak with to get one listing?
Some listing sources produce better results than others. You could make 150 cold telephone calls to get a listing, or if you prospect on a busy road, you might get one listing for 70 calls. Help your strugglers identify the warmest listing sources and have them work those sources.
Fourthly, monitor their actions. Are they following the plan? If so, persist with them. If not, terminate. Never pay wages to people who will not do what they said they would do.
Turning strugglers isn’t a complicated process, but it does require the leader to act. Don’t accept poor performance as ‘just the way it is’.
If I can be of assistance, please do let me know.
In this short leadership session, real estate agency profit consultant, Gary Pittard, points out the difference between great leaders and great pretenders.
If you want quality results, you need quality people. You don’t put your head out of your office window and whistle for winners: it takes hard work, over the long term, to find them, develop them, and to weed out those who do not fit the team.
Do your results fluctuate? Are they persistently low? Have you ever found yourself blaming outside forces, such as the market or difficult clients, for a run of bad luck? The good news is that this can be fixed.
In my book, Why Winners Win, I name four Success Ingredients: Attitude, Knowledge, Skill and Competent Action. MORE
With the right attitude, you will study. You will practise what you learn in the field. Through this practice you will develop skill and your actions will become more competent.
But you can still be competent and not do enough competent actions, so your results will still be low. This is why self-management is so important.
Some call this time management, but we really don’t manage time; we manage ourselves within the time we have available.
Many salespeople drift through their day without purpose because they don’t have a plan. Those with goals and plans get more done. They manage themselves and their time because they know where they are going, and why.
So… do you have a plan?
The key to skilful self-management is to know what needs to be done and to be willing to do it.
Winners treat their time as a valuable asset. They guard it and give it to the right people. They don’t allow the wrong people to steal their time.
With these foundations, self-management is much simpler. No time is lost thinking about what needs to be done next – just open the plan and follow the next step. And by constantly studying and improving, little successes fuel motivation to do more. Gradually, inconsistent performance begins to turn into consistent, climbing results.
You might not be doing enough of the right actions right now, but you can fix it.
With a plan designed to lead you to goals you really want, you will find self-management easier than you first thought.
Give it a go.
In this short sales session, real estate agency profit consultant, Gary Pittard, says that salespeople who will not train are doomed to fail.
There are no new objections in Sales. It is possible to learn every likely objection and learn how to prevent it from becoming a barrier to a sale.
Training can be expensive. It might cost $2,000 to attend a seminar to learn how to overcome these barriers. But have you ever calculated the cost of incompetence?