Help-U-Sell Adds Board Member

RISMEDIA, May 3, 2007-Help-U-Sell Real Estate, a set-fee services company, has announced that Patrick Stone has joined the company's Board of Directors.

Stone has over 32 years of experience in the real estate industry, most recently as vice chairman of the board of directors for Metrocities Mortgage. Prior to that, he enjoyed a lengthy career as president and chief operating officer of Fidelity National Financial, where he was credited for growing the company into the number one title company in the country.

"To add a person with Patrick's breadth of real estate experience and proven leadership will be a tremendous advantage for Help-U-Sell," said Steve Ozonian, Chairman of the Board. "We are excited that Patrick has agreed to join our Board of Directors and expect that he will play a key role in moving the company forward."

"Help-U-Sell is clearly at the tipping point in the real estate industry," said Stone. "Transparency in the real estate transaction is as important as ever, and Help-U-Sell's set-fee model and focus on the consumer experience is the wave of the future, and I'm excited to be a part of it."

An alumni of Oregon State University, Stone is on the Oregon State University Foundation Board of Trustees, serves as Chairman of the Board of Trustees of the Santa Barbara Museum of Art, is Chairman of The Stone Group, an Austin, Texas-based commercial brokerage and development company, and is an audit committee member for Direct Relief International, a non-profit organization based in Santa Barbara, California.

Help-U-Sell Real Estate reports having nearly 1,000 offices in 46 states, and operations in South Africa, and the Philippines. The company was recently rated the number two "new" real estate franchise model by the 2006 Swanepoel Trends Report. For more information, visit www.helpusell.com.

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?

Keller Williams Profit Share Model -

I recently discovered the inner workings of the profit share model that KW implements that makes it incredibly transparent. It doesn't take away from the company, but to me, personally, it eliminates it as a reason to join. Basically, it goes from the Steak to the Gravy.

Here's how it works:

Let's say, my name is BOB and JOHN recruits me. Also lets say my split and cap for the market center is $15,000. What was the big AHA for me is that after this $15K is paid, BOB is no longer sending profit share to JOHN. In a really easy math scenario, if John gets 100% of the money, he would only get $15K. Now that may seem like an obvious thing, but they way they present it to you will make more money in a more profitable Market Center. Now I'm guessing that if you have a market center that is not profitable, they dip more heavily into the $15K each agent pays.

Just for information, let's see how the chain works as well:

JOHN recruited
BOB recruited
SUSAN recruited
STEVE recruited
BETTY recruited
JUAN recruited
TANISHA 7th Level

So JOHN will get X% from BOB & TANISHA, 1/2X% from JUAN & SUSAN & 1/4X% from STEVE & BETTY.

X is determined by your % of profitability to the Market Center and I suppose how profitable your Center was.

Previously, I had assumed that other profit sources directly tied to agent actions such as MLS fees (that get redistributed) would have added to the profit share. Instead, it's directly tied and only tied to the $15K.

It's a bit disapointing that it's not deeper than that, but again, KW has so many great things that people will join for, so getting a little back is perfect. In the end, the profit share model ends up being another MLM if it has stand on its own merits.

Win/Win or No Deal - Keller Williams Realty

Keller Williams is now one of the fastest growing brokerages around. In many market places, KW is becoming so popular that it runs into the same pitfalls of the other large brokerages, and that's the problem of how to differientiate each agent from the next. Albeit, that's more a problem for the agent and not the brokerage itself but it's definitely a testament to their success.

Keller Williams is about making money. Most KW "market centers" as they are called or offices are run by lazer beam focused profit makers. They preach the "word" (Also, known as the Millionaire Real Estate Book) to every agent and focus on helping the top 20% succeed while offerring help to the bottom 80% in the form of training and classes.

KW training is unparalleled. They take from the world's best trainers and coaches, put it through the KW marketing machine and then spit it back out to any KW agent willing to take it in. It's about systems and succeeding.

KW's business models are one that is a mix of contemporary and traditional. They take a percentage of each sale up to a certain amount (roughly 20K) every year and in turn give the agent an incentive for recruiting, known as profit share. Keller Williams was one of the first to implement this now common system of rewards for recruiting. It works very similiar to a MLM. In theory, you could recruit 10 agents that could pay for your "company dollar" and allow you to do KW completely 100% commission side.

KW has a unique culture and atmosphere. It's truly the only brokerage that I've ever worked with or been a part of that emphasizes team work and helping others. It's the one place where your competitor will say, "here's how I'm kicking your tail in your neighborhood."

There are some drawbacks to joining KW but they are the same ones found in Remax, Coldwell and the like. Ultimately, if you're going with a franchise you can kiss doing creative builder relationships, unique co-ops, and LLCs good by.

To sum up my usual unhelpful ramblings.

PRO

• Profit Share
• Training is number 1
• Atmosphere
• Assistance
• Ethics

CONS

• Commission Splits
• Everyone is joining, dilluting the "elite-ness"
• Same pitfalls as large franchises

LOCAL: Remax/ CENTER

I got this in the mail and thought I would post it.

You get REMAX name in return for:

Plan A: $725 / MO 95/5 Split
Plan B: $258 / MO 70/30 Capped at $9000
Plan C: $67 / MO 70/30 Capped at $15,000

Includes MLS, E&O and Website.

Re/Max Center seems to want to compete with the more progressive models such as Keller Williams, ERA and Exit have moved to. This IS the model for Real Estate now, maintain some of the good elements of a traditional brokerage but also giving licenscees the oppportunity to choose.

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