Want to know more?   Contact us today.

What Is Your Value Chain?

Late last year, I read a Real Estate Business Online article entitled, Purplebricks already effecting ‘dramatic change’ in commission-charging agents’ behaviour. It quoted Purplebricks global COO Neil Tavender stating that since entering the Australian market, Purplebricks has caused traditional agents to reflect significantly on how they operate.

Tavender was quoted as saying, “We have seen in some instances where commissions have come down from 2.5 per cent to 1.8 per cent. But obviously with the fixed cost models that they have, with premises and associated costs, that is not a sustainable future.

Personally, I think this is a bit of a stretch. In states where the market was tanking, WA for example, you hardly hear of Purplebricks. Pittard has clients across Australia and none have raised Purplebricks as being a threat.

The fact is, weak real estate salespeople have been discounting their fees to win business long before Purplebricks came along. The recent boom in some states was the reason some salespeople discounted their fees – they wanted to win listings and discounting was the only way they could see to do it.

But Neil Tavender does make a good point: discounting is not a sustainable future.

If you feel that you must discount to win business, if you think that fee is all you’ve got, you have no alternative but to be cheap. And no matter how cheap you are, somebody will always be cheaper.

A better way to win business at a fair fee is to prove your VALUE CHAIN. Your value chain consists of things you can do for sellers that other agents do not do.

To create a value chain, think: why should sellers list with you?

You say you are good, but in what way?

Salespeople often give this little thought. The result is that they look the same as their competitors. When you look the same, you can only compete on fee and giveaways – lower your fee, or perhaps throw in some premium advertising.

Cutting your fee, or adding incentives, cuts into your profit. It demonstrates a lack of business acumen. And if you lack business acumen, how could you expect sellers trust you to sell their properties?

Think about your value chain – it’s the key to winning business with a fair fee for your hard work. Leave discounting to those who have no value to offer.

Gary Pittard

Recent Articles

Marketing

When the market turns down many agency leaders wisely cut expenses. But there is a right way and a wrong way to do this. Cut the wrong expenses and yo...

The Forgotten Rookie Syndrome

Many salespeople either become sales managers or move into a leadership role as owners of their own real estate businesses. Gary Pittard, CEO of t...

Hard Tasks Pay

In 30 years I have interviewed countless winners, and have noticed one big difference between winners and their mediocre counterparts: ...

Make the Most of a Golden Opportunity

"This is truly a great career. I wonder how many real estate salespeople actually appreciate the golden opportunity their real estate career offer...

Think Profit

With another financial year behind us, it's a good time to ponder: "Are you happy with your profit?" Stating the obvious: Profit is the mo...

Succession Planning All Talk or All Action

In this short leadership session, real estate agency profit consultant, Gary Pittard, discusses Succession Planning. Many agency leaders talk abou...

Short Attention Spans

A common complaint from leaders is that their salespeople lack focus. It has a been constant theme in my 30 years as a real estate agency profit consu...

Ask for Price Feedback

Property sellers need accurate information from the market if they are to develop an understanding of the correct market price at which their prop...

Hiring Do's and Don'ts (Part 2)

This is a two-part article on the Do's and Dont's of hiring. Last month, we discussed the Hiring Don'ts. This month we look at the Hir...

Sharpen The Saw

Real estate agency profit consultant, Gary Pittard, recommends that leaders give their salespeople knowledge tests, yearly at least. If you think ...

A Foundation of Honesty

Below are snippets are from surveys conducted by Roy Morgan over a 17-year period. I have been following these surveys for 25 years and note the posit...

Happiness Is Relative

In this short sales session, real estate agency profit consultant, Gary Pittard, discusses happiness and its relevance to real estate sales. Happine...

Want to reach your profit potential? Contact us now.

Pittard


Suite 71, Level 4
330 Wattle Street

Ultimo NSW 2007
Australia


Mailing Address
PO Box 2045
Strawberry Hills NSW 2012


: (02) 8217 8500
Fax: (02) 9281 4198
AUS Free call: 1800 663 600
NZ Free call: 0800 448 065
International: +61 2 8217 8500

: info@pittard.com.au

Contact Us