Pros And Cons Of Solo Versus Team
BATTLECALL GUEST EXPERT: Walter Sanford, National Real Estate Trainer
I recently received some questions regarding the pros and cons of working solo versus working with a team. What follows are the questions and my answers.
Some of these questions have to be considered in the context of whether a team member is paid overhead or no overhead (a.k.a. FREE!). My lender would handle my FSBO program, my divorce program, and my showing follow-up program in return for ideas that helped him generate leads, build loyalty, and enjoy the freedom of not having to call on my office for my business.
1. Overall, what are the basic pros and cons of going at it alone versus being a part of a team, and how does one go about working through the cons of each strategy?
The cons of non-paid affiliate teams are that the loyalty to get the job done lessens if the agent supplies less business. Letting go of important steps in a real estate agent's transaction might not feel comfortable at first. To cure this, many checks and balances must be set up to monitor the affiliate's progress in the program. As an affiliate lender helps with FSBOs, I will have to train him on the script, follow-up letters, and reporting schedule to me for my follow-up. My part of the systems would involve generating the leads and preparing them for my lender. These systems must be put down on paper and agreed upon.
The cons of paid assistants are as follows:
A. Not right for the job and the related problems that result
B. Not generating enough income to rationalize their existence
C. Any layer of manageable assets will detract from my abilities to generate net income
D. The cost of the learning curve
E. Square footage
These items can be handled adequately by the following methods:
A. One of the horrors of real estate assistants is that the good ones seem to be elusive. From my own numbers over thirty years of hiring and managing assistants comes the following, I hired one assistant after interviewing approximately ten applicants. I had to fire four of those before the sixty-day probationary period before I found one gem. That gem, in half the cases, learned my systems and within a couple of years became their own real estate agent, which once again forced me into the hiring process and the learning curve. This trouble can be mitigated by becoming, or using, a headhunter. Finding an already trained assistant who operated optimally was wonderful, but it could cause hurt feelings from the competition's point of view, if they were the one to loose their assistant.
B. Generating income was handled by having good checklists prepared on my lead generation activities from my personal experiences, then training my assistants on them before they became bogged down with transaction coordination. Even though transaction coordination was necessary, it could easily fill an assistant's day. Therefore, three hours of solicitation was mandatory. This was accomplished through mail, email, phone, web updates, follow-up, and research. This way, a salary could be rationalized by the amount of leads coming in.
C. The more time training, the less time "making rain" (creating leads and closing business). This can be cured substantially by point D below.
D. You can eliminate or severely reduce time with checklists and manuals. Also, there is a lot of truth in, "If you're going to have one, get two." This means that if you have two assistants, and they are cross-trained, then the learning curve is reduced because the second assistant becomes number one and the new number one can train the new number two. Furthermore, it is the unpaid affiliate team member's duties to train the new assistants on their jobs. For example, a lender also trained my assistant on how to take a loan application and showed him/her the flow chart of a loan in process.
E. Believe it or not, one of the largest problems is square footage. Often, the square footage is paid for by the broker within the office building, but a new assistant in house may make your allotted space cramped. Most of my top coaching clients are looking for space for themselves. One of the best investments an agent can make is their own office building. It is split 50/50 as to whether these clients remain under the banner of their original broker. Providing square footage to a top producer who has been proven profitable to the company can be a huge benefit of recruitment for a broker.
2. How do personality style and work style play into this equation?
If you cannot delegate, you will find it hard to become successful. You can start by delegating items to your checklists, technology, family, affiliates, clients, and broker paid staff before you take that leap in increasing overhead.
3. How about issues like finances, overhead, management, flexibility, business and project ownership and taxes?
Of these questions, the one that I have not handled is taxes. Get a payroll service and/or an accountant, period. The worst is having an assistant hold you hostage because you have paid them illegally under the table. Payroll is a Schedule C write-off. Flexibility will definitely increase with help. I call it "getting your life back." However, many job duties of assistants being touted today are self-defeating and non-profitable, such as buyer's assistants. You pay them 50% of the deal, pay an overhead of approximately 30%, and net 20%. Putting buyers through five or six qualification hoops, then just handling the top 30% will increase your income substantially! The assistant is only working with the top ones anyway. Business and project ownership was and is still taken care of by me.
4. Do you feel that an agent's choice of operating mode is connected to their future plans for growth and expansion? In other words, does someone with big aspirations for growth naturally gravitate to the team approach?
The ability to "duplicate" yourself and your operations is the only way to make more money in less time.
5. From your own experience, is there a "grass is always greener" side to this equation? Do teams envy the independence of solo agents, for example? If so, how does one work around these issues?
Everyone envies a well-run, profitable team.
6. What key areas should an agent be looking at before deciding to do business one way or another?
They need to delegate to all unpaid staff. If they still want to make more in less time with a frame of reference in their life, then hire a paid assistant.
Thank you for giving me the opportunity to answer these questions for you. I hope that this would be a beneficial checklist of items for each agent to decide for himself/herself if working solo is best or working with a team can be better! Good luck!
Walter Sanford was one of the top real estate agents in North America for nearly thirty years, and now, he is one of the most requested speakers, trainers, and coaches. He has authored twelve systems and books on checklists, pro-active lead generation, affiliate lead generation, plus others mentioned in this article. You can hire Walter or buy his products by visiting his website for more details at waltersanford.com.
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