Owning and operating a successful real estate brokerage is no different than owning and operating a successful business in any industry. When aspiring to start your own brokerage, regardless of your chosen niche or specialization, you’ll need to start with a few non-negotiables. Smart planning, thorough research and expert follow-through are key!
1. Have an idea, but make sure it’s viable
Once you have a targeted idea for the market your brokerage will corner, your next job is to do the research. Make sure that your great idea is also a viable one for your audience. If it isn’t, you may need to rethink your approach.
2. Create a business plan tailored to your brokerage
You’ll need to closely examine your start-up costs, business model, overhead, and the other fine-tuned details of running a business. Here are some elements to consider when writing your plan:
What kind of company will you be? — a sole proprietorship, general partnership, an LLC, etc. — Find the one that best fits your needs.
Estimate your earnings and expenses. Break down expenses into categories and make sure to account for things like E&O insurance, taxes, rent, tech support, web/phone service, and managerial office services. Start-up costs can be substantial and unavoidable, so make sure you have enough funds to carry you through the inevitable “lean” start!
Determine a commission structure and how advertising expenses, referral fees, and other costs will be divvied among salespeople. If you’ll have managerial employees, determine a structure for them too.
Determine and test a strategy for recruiting and retaining dedicated salespeople and staff. After you’ve enjoyed a few months of “smoothing out the kinks”, it’ll be time to make sure you’re ready for growth!
3. Hire outside experts to get the job done
Remember that you can be a jack-of-all-trades or an ace of one. Focus on the areas of business that you do best, and seek help from the experts in other areas– such as web design, marketing, photography, office management, and accounting.
4. Invest in your image
There are many areas where you can cut costs when running a business, but marketing materials shouldn’t be one of them! Effective marketing materials — including your website, mailings, and ads — should always project a professional, unified image. A little goes a LONG way here!
5. Recruit, recruit, recruit
Focus on the benefits that separate your brokerage from the others, and communicate those points as you seek top talent. People choose careers in real estate because they’re entrepreneurs– it’s important to recruit salespeople who want to grow and maintain their personal brand, while too representing yours.
6. Find the best way to “know” your niche
Don’t just guess about the best strategy to reach out to niche clients– ask them! Get to know your target audiences, what they’re interested in, and how you can help them actualize their dreams.
7. Reward your agents AND thank your clients in memorable ways!
Remember that you got into this business for the people! Keep your agents motivated and happy by rewarding their hard work. The same goes for your clients– thank them for their business in ways that are memorable of your experience and they’ll likely send you a referral down the road!