The Dirty Little Secret You Need To Know About Agent Retention

As enterprise house owners, it’s vital to do the maths and perceive what causes some brokers to depart your brokerage.

In these occasions, double down — in your expertise, in your information, on you. Be part of us Aug. 8-10 at Inman Join Las Vegas to lean into the shift and study from the most effective. Get your ticket now for the most effective worth.

That is the primary of a two-part collection showing in Dealer Edge.

In fairly probably probably the most aggressive brokerage atmosphere we’ve ever seen, retention is a sizzling subject. And rightfully so. In reality, retention has lengthy been a sizzling subject, particularly for brokerage house owners, as a result of we provide blood, sweat and tears to the brokers who be part of us, and these brokers simply so occur to be the first income supply for an actual property brokerage.

To not point out, many enterprise house owners throughout many industries would let you know it’s simpler (and cheaper) to maintain a present buyer than to discover a new one. Fundamental fundamentals of enterprise. You get it. 

So what’s the soiled little secret? There may be nothing you are able to do to retain everybody. There. I stated it.

Nothing you are able to do.

Now earlier than you trash that remark and the remainder of this content material, or take too large a sigh of reduction as if you’re “off the hook” from the retention accountability, let’s rewind. I particularly stated there’s nothing you are able to do to retain everybody. You want to perceive this earlier than you are taking significant motion to retain as many individuals as doable, which you completely ought to do.

Why is that this the soiled little secret? The maths behind retention and attrition. The gorgeous factor about math is, you possibly can’t argue with it.

To be clear, retention and attrition usually are not the identical. Let’s take a minute to unpack the variations and similarities between the 2.

Retention

Analysis from the Nationwide Affiliation of Realtors (NAR) tells us that the common actual property agent stays at a brokerage for 5 years. As impartial contractors, brokers are free to roam in regards to the business as they select.

I’ve by no means seen an impartial contractor settlement that had “lifetime” written into the phrases, nor have I seen an agent signal one in blood. You’ll be able to struggle again towards the common in fact (and it is best to); nevertheless, over time and with the Regulation of Massive Numbers, you can not keep away from it solely. 

Let’s be trustworthy: when individuals go away, it hurts. We could really feel as if we’ve failed them, we could really feel betrayed, we could really feel an absence of loyalty. These are actual feelings. Understanding you possibly can’t hold each agent could assist you to transfer via a few of these feelings in a wholesome manner.

My expertise tells me that 99 % of the time, individuals go away for causes far more private to them than something you possibly can management, so half methods on a excessive be aware. Verify your ego on the door, take the excessive street, study what you possibly can to enhance and want them properly.

In spite of everything, you may nonetheless be cooperating with them from throughout the road, and you may be shocked what number of determine to return again when they’re handled with respect upon their exit. I’ve seen it occur extra occasions than I can rely.

Chances are you’ll personal your brokerage, however you don’t personal your brokers — so don’t act prefer it.

Attrition

Attrition is retention’s ugly twin. They’re related however not the identical. In the true property business, we function on commission-based gross sales, due to this fact the speed at which individuals fail or give up is robotically larger than different industries.

This may be for quite a lot of causes: Retirement, a change in profession path, life change, or they merely didn’t discover the success or success they have been in search of and finally determine to give up their license. 

NAR stats additionally inform us {that a} mind-numbing 87 % of Realtors get out of the enterprise inside 5 years. Which means solely 13 % survive longer. As an proprietor, hold this in thoughts if you’re beating your head towards a wall working to assist brokers succeed.

Don’t cease doing that, simply perceive that always you will have it for them greater than they do. You’ve most likely heard the saying you can lead a horse to water however you possibly can’t make it drink. I’ve heard a greater one: Discover thirsty horses.

As leaders, we usually need everybody to succeed and genuinely consider they will. That’s what makes us leaders. Nevertheless, as enterprise house owners, we have to perceive and plan for the maths across the business we function in. That’s simply good enterprise savvy.

Able to struggle again towards these averages? Good. Let’s get to work subsequent week partly two.

To learn how to struggle again, try half two of this collection, showing in subsequent week’s Dealer Edge.

Chase Williams is the co-founder of NW Wealthbuilders and development chief for the Keller Williams Northwest Area. Join with him on Fb or LinkedIn.

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