Is your company supporting your business…or are you supporting their business?

As I do more and more research on the different Brokerages it amazes me that no matter how much a company is more cutting edge in their methods, they still are doing business the traditional way. That is, they spend money, AGENT'S money, promoting THEIR brand and generating THEIR own leads ... which in turn are sold back to the agent or given to the top producers.

Let's examine their business model.

Recruit new agents - Take 50% from their sales and hopefully they will become good. If they get big, they will be rewarded with new business opportunities that were generated off of their split. They'll get perks, such as parking spaces, offices and key opportunities.

Worst case scenario, the prospect doesn't pan out and the company gets some free advertising while they were working.

Last time I checked, 100% of my clients wanted to work with me, not my Broker or my brand. When I switch companies, my clients come with me.

So who am I talking about? Let's call some of them out:

• Remax - Still on a traditional split - never caps, or if it does it's coupled with exorbinant "desk" fees. Recently they developed LEADSTREET where they generate leads and sell them back to the agents. They also came out with REMAX University. Sounds very familiar with another University.
• Coldwell Banker - This is a company that is owned by Cedant. In any case, the split is the same traditional one, 70/30 for most agents with no cap in site. All branding must be CB and not the SMITH TEAM.
• C-21 - Again, owned by Cedant. C-21 is becoming the red-headed step child of brokerages. On one page you'll see a recruting ad, proclaiming how successful people will be by joining. On the opposing page, there's an undermining ad of "SAVE OUR COMMISSION" explaing C-21 Flat Fee franchises. To me this is the bottom of the barrel for a company.
• Prudential - Works the traditional system as well. They would love for their agents to buy into their other products and sell them as well. Overall, they view agents as employees.
• ERA, Exit & GMAC - These companies are copying the KW model but getting it all wrong. Instead of actually sharing profits, they dip into agents pockets -- forever. At GMAC, people who recruit you will receive 1 to 2% of your total earning. This does not go levels deep and never caps out. ERA and Exit have similiar reward models.

In some cases, these brokerages will offer lockboxes, signs and other resources. The downside is that all of these items keep you dependent on them and, oh yeah, "would you like some JOHN SMITH with your Coldwell Banker sign?"

So who's not doing this?

• Keller Williams - Doesn't spend a dime on brand building or recruiting. Each agent caps out at a predetermined number, in Atlanta it's 18K. After that it's strictly 100%. This renews itself every year. This also creates equality and quality control. No agent is worth more than the 18K so unethical agents will be "dehired." That's unimaginable when brokerages would hire monkeys if allowed. It's more about YOU the agent. KW spends their money on training agents how to do the business. If you've ever met a KW agent, then you know it's about being professional and having a career worth having.
• Solid Source (Local) - A Per Transaction based company. Their "Christian" foundation makes them an interesting study.
• Flat Fee/100% Companies - They offer no training or support but you keep everything. Typically you can do what you want as well, even as far as creating a sub brand.

This was pretty down and dirty but it should give you some insight. What has your Broker done for you lately? My guess if they aren't teaching you how to fish, their causing you to be dependent on them. If that's the case, ask yourself this, "what happens when the market shifts and it's no long profitable for them to provide these things at this price?" Prices go up, ethics go down and you'll be looking elsewhere.

At the end of the day, when you look at your business, are you supporting YOUR brand of Real Estate or your BROKERS?

Professonals?

Another flat fee company out there is known as Realty Professionals. Very much like Chapman Hall and other flat fee type companies. It's a no service, no support, all the commission company. This is a great business model overall and really assists in the helping agents lower their commissions and pass the savings along the consumer. The difference between Realty Professionals and Chapman Hall or any rather, the difference between Chapman Hall and all other flat fee companies is that Realty Professionals charges a transaction fee. So in exchange for less of a monthly burden you only have to pay when you perform.

With many of these types of brokerages out there, it's no wonder why they are not doing anything in the market overall. One of the reasons why Remax, Coldwell and others have experienced agents is because they simply can afford it. If you can't pay the bills you'll likely end up at one of these flat fee companies. Now whether you get what you pay for is up to you. I could make a case against it at Remax. So the question still remains, are the agents at Realty Professionals, professionals? If you take professional to mean, competent, then YES. However, if you take professional to imply that an agent is taking the business seriously and sees it as a career, then I would have to say, No. There are exceptions to every rule, there are top agents world over that are in unheard of brokerages, so don't take that as a hard and fast rule.

In any case, Realty Professionals offers a nice, relaxed enviroment. The big draw of this particular company is the laid back broker, Jim Burchette. Every agent I've encountered has had nothing but nice things to say.

Again, as with Chapman Hall, you get a low risk, relaxed enviroment with no training, no support or leads or anything. In comparison, RP has more offices than CH, but at a higher cost.

Summary:

What you get with Realty Professionals

• $200 A month / $250 a transaction
• more office locations than most flat fee companies
• no training
• no frills

LONE WOLF

In the local market of Atlanta, we have several flat fee type brokerages. This post will talk specifically about one of the best "deals" of these type of broker houses. I'll cover Homewise, Zip and others in another post. However, none of them come close to the "deal" or the growth of this one franchise, Chapman Hall.

Chapman Hall has an insanely simple setup. I speak from experience because I held my license there for some time. At $125 or so a month, this fee is the only thing that CH takes from you. That's almost on par with what traditional brokerages take as a E&O, MLS fees ect. This 125 covers it all. They do take the FMLS fee, but ever broker does that as well. Just in case you didn't read it, that's 100% commission, for 125.

Chapman Hall Realtors is to Realtors as Flat Fee MLS listings are to FSBOs. You get a great deal, but unless you can do it all on your own then you might be in a bit over your head. No training, no marketing, no real staff or support even. John Hallman is more than accomodating and great broker, but managing several hundred agents at once can be a daunting task.

Basically, what it amounts to is a great way to run a business inside a business. It sounds really good in theory and there are several great agents at CH. However, if you look closely, many of them are plateauing as I did. There's simply no competition, no comraderie, no office, no listings... ect. The majority of all the agents end up as lone wolf agents that have little to no market presence (individually), despite the overall large market presence of Chapman Hall in certain areas.

In Summary

What you get with Chapman Hall

• The single best financial deal in town
• No Support
• No Training
• No Frills
• Insert a question here, Answer: No