Byron Kerr isn’t afraid of declining stock levels.
In the 2018-2019 financial year, when the Melbourne market was on a downward slide, the O’Brien Real Estate Mentone director and his team sold more properties than the year before.
“It was a market with decreased stock levels of about 25 per cent,” he said.
“Yet we increased market share by 12 per cent.
“We had 203 transactions last financial year compared to 184 the year before.”
Byron says the secret was streamlining the team’s administration workflow, introducing platforms to automate some tasks and hiring a dedicated admin staff member to drive that area.
He also reduced the number of properties he sold so he could focus more on the growth of his team.
This allowed selling agents to spend more time on dollar-productive tasks.
“It was about getting more agents in front of more clients,” Byron says.
Come September 9 and 10, Byron will be one of more than 20 speakers at The Business of Real Estate on the Gold Coast.
Byron will share how his focus on a high-performance culture and great customer experience saw his office improve in a tough market and how he significantly boosted profit.
Here is a sneak peek of Byron’s five tips for success:
- Boost profit
To boost your profit, you need to improve operational efficiency to reduce costs, as well as people efficiency to drive revenue.
When it comes to operational efficiency, it’s essential to understand the key fixed operation benchmarks that can drive profit.
A simple, standout focus for any real estate business is how they treat vendor-paid advertising.
The real estate model of carrying vendor marketing has to stop.
An office that can ensure all vendors pay for marketing upfront (merchant banking facility or a Campaign Agent-type product) has the means, depending on the size of the office, to improve its bottom line by $300,000 to $500,000.
This can equate to more than 10 per cent of profit for most offices.
For far too long the industry has had a fear of losing market share due to vendor-paid advertising costs.
It may feel good having a board up, but agencies are using their profits from the past 90 days to fund their vendor-paid advertising bills.
In terms of people efficiency, it’s time to look at the number of hours income generators dedicate to administration.
It’s amazing how many people in an office, be they selling agents or property managers, have administration downtime.
An agent spends about 15 hours per week on administration tasks, and a property manager spends upwards of 20 hours per week.
Removing this administration downtime hurdle can allow you to drive revenue. In a sales team of 10 people, you can save 150 hours a week in prospecting time, which can do wonders for revenue.
- Increase market share
It’s all about people management.
You need to leverage time and who is spending time on which actions.
As an example, a good, consistent agent has the means to complete 20 sales per year.
Free them from administrative duties and watch as that number shifts from 20 to 25 sales, or even 30 transactions for the year.
Again the maths is simple.
Small, incremental changes per person, across a sales team of 10 people, can change your overall market share by 50 to 100 transactions.
No agent in our business deals with marketing approvals, building of SOI, booking open times, booking final inspections and database entry.
To drive greater market share, get your administrative team structured well, either with the use of virtual assistants and/or in-house IT platforms like monday.com or ourproperty.com.
This removes the need for time zapping administration and increases your ability to make more money.
- Generate happy customers
I wish every customer loved us.
However, the truth is, they don’t. There is certainly a trend that the consumer is obsessed with speed and ease of communication.
Everything we do is designed to speed up the process and over-communicate clearly with each person that comes in contact with our business.
Issues are going to happen daily as your business grows, so it’s your ability to deal with these challenges clearly with a vendor, buyer, landlord or tenant that will create fans and repeat business.
- Starting from scratch as an agent or new office
Too often we think there is a magic formula for making a business successful.
We also believe that brand perception is all that matters. What we should be doing is making it all about the customer and not about the agent or the agency.
The team that has the discipline to master the basics day-in and day-out wins.
- Building a good team culture
Building a good team culture starts with a clear purpose and is supported by company values and a team that understands and believes in the company’s mission.
This allows the team to have a clear understanding of whether they are on the right or the wrong track.
It also allows leaders to set clear parameters for coaching and mentoring.
It is even more important to ensure the people who form part of the team are high in character and reflect the values of the company.
Too often businesses make a decision based on the individual’s level of competency and are enticed by commission, which can be detrimental to company culture.
Byron Kerr will be speaking at The Business of Real Estate in September. To book tickets visit thebusinessoferealestate.com.au.
Claim your special Elite Agent rate of $1050 to The Business of Real Estate by using the code “ELITE” at checkout on the “regular rate”. Save $445. Available only until July 27th