REAL ESTATE B-SCHOOL HIGHLIGHT: How to Set Productivity Standards for Your Agents

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Transcript:

Let's get into goal setting and minimum standards. We went through the Position Agreement in Module 5, and on my team we have two sets of minimum standards. We absolutely hold to these minimum standards, and I encourage you to take a stance here with your team.

I've seen teams with double the amount of agents I have selling less real estate than my team sells. We [were] at about 215 sides this year, and I have three new agents who have six or seven sides so far. So that's 30 sides per agent at mid-year. That's the kind of productivity you should be striving for.

Minimum Productivity Standards

On our buy side, we have a minimum productivity standard of two transactions per month, and we look back 90 days. So there are six per quarter. If you're selling 24 homes on my team, you're probably not doing that great. We've let an agent go who just sold over 24 homes and she wasn't ever really going to kill it for us like we want.

Then on the listing side, it's easy for our listing agents because we do so much of the process for them. But technically it's 3 sides per month of 9 per quarter. Our listing agents will sell 50+ homes easily. One will get to 75 homes or so. I do believe that as far as goal setting goes, it's important even if you're a solo agent.

Some of you here in Real Estate B-School are listening to these team-building modules are kind of scratching your head. But I've always forecasted my production and I've always set goals for myself. Without goals you have nothing to shoot for. You need to set annual, quarterly, monthly, and weekly goals for every part of the pipeline. But it's important to take your team through this process. 

Surprisingly, your team won't do this on your own. I'm going to go through the Goals and Compensation spreadsheet here in a minute, but if you give them the spreadsheet, very few of your team members will actually go through this process. It's a weird thing. Part of the reason why you're so successful as team leader is because most of society in general just doesn't care enough to plan out their life. But you're not that sort of team, you're a Super Bowl caliber team, and your agents need to be dialed in on what needs to happen for them to be successful. 

Agent Goals & Comp Tools

This is in your Dropbox, it's called Agent Goals, Comp, & Affirmations. There are actually a few tools embedded in here. This is a tool I used back in 2008 when I was a solo producer, and at the time I wanted to do $250,000. working X days per week, 10 hours per day, 48 weeks, percentage of time on versus in your business. I would earn an average commission check at the time of about $6,000. We're at $7,500 now. So that's 42 transactions.

The point I'm trying to make is you can do this as a solo agent. At that time I was probably light on the listing side so it was 30/70, so I had to sell 13 listings, 29 buyers. Then it goes through that of the 13 listings, I know that 75% of my listings sell, so you have to take 17 - you have to take more than 13. You sign up 2/3 of sellers you meet with so you actually have to go on listing presentations.

This is a great exercise for you to do and for every one of your agents to go through to see how these numbers and these conversion rates come together. Most agents don't put this stuff together. Let's say you're a purist model like we are, and you have an agent who wants to make $150,000. That's a stretch for buyer agents on our team but it's doable. We're at about $7500 average so call the commission $3250, so that's 46 transactions. It's all buyer side so of buyers that sign a loyalty agreement, it's probably 50% to 60%. We sign about 90% of buyers we meet with but we'll use that for the purposes of this example.

So if you want to sell 46 buyer sides, with the inefficiencies of signing someone to a loyalty agreement and then actually getting someone to sign, you need to make 100 presentations a year. That's two presentations per week. That's the way we boil it down for our agents, using those exact numbers.

Your Value as Team Leader

We'll probably give them an opportunity to sit down with a new buyer once a week, on a team-generated appointment or showing appointment, and then on their own they need to come up with two to three legitimate new buyer consults or showing appointments. They need to be giving two to three presentations every week to earn $150,000.

If you've never gone through an exercise like this, those are the kinds of numbers you should be well-versed in and you should be able to walk you agents through. This is the part of the value you add as team leader.