Business Size with Assistants and Callers – How Big?
If you focus on your unique talent and spend four hours a day meeting, two hours calling, and two hours on other tasks, how many deals could you be doing per year? Let’s assume you have enough assistant help to handle the volume of deals, listings, and closings, and you have enough lead flow and calling to produce the need for these meetings. Here are a few more assumptions:
* Seller Deals - Assume you have two listing appointments per week which last for two hours each. This amounts to 100 listing appointments per year. Those 100 listing appointments should result in 50 closed seller deals. You spent four of your 20 weekly meeting hours so you have 16 hours left for buyers.
* Buyer Deals - Assume you spend 15 hours per week meeting with and showing homes to buyers. If you have a 60 percent close rate, those 50 buyers should result in 30 buyer deals. Does that sound crazy? Could you do 80 deals per year before you even need to have other agents working with you? Perhaps that is a bit high; it also assumes you have good seller lead flow. If you have a 70/30 buyer/seller split early in your career, it may be 50 to 60 deals total.
Showing Agents for Seller and Buyer Balance
As you grow your business, it naturally shifts from an initial buyer focus to more of a seller focus. Everyone in the industry agrees that top agents become listing agents and they focus on seller business for a variety of reasons.
Buyer Agent Model is Broken
When people hire a buyer’s agent, they often end up paying someone $100/hour to perform three different roles which should be paid at a rate of $20/hour. Let’s review a typical buyer’s agent model. If you asked teams with two to five buyer’s agents for their total deal count last year, subtract out deals done by the business owner and divide by the number of full-time buyer’s agents during the year, we predict you have an average of ten deals per buyer’s agent. That is a joke.
If the buyer’s agent is working full-time, that is 2,000 hours per year. If a buyer deal takes 20 hours and they spend 10 hours working with another buyer that did not close, we get an estimated 30 hours per buyer deal. Ten deals times 30 hours is 300 hours. A $200,000 sales price is worth $6,000 in commission. At a typical 50/50 buyer’s agent split, that is $3,000 to the buyer’s agent for 15 hours of work or $150/hour. If your BA did about ten deals that took 300 hours of their year, what did they do with the other 1,700 hours of the work time?
I have had this discussion with a number of top team leaders and they usually end up laughing at the bar and then crying into their drink. Ask anyone who has a top team and has hired/fired more than ten buyer’s agents about this and see what they say. The buyer’s agent role should consist of three things:
Calling - You need to make 200 dials to close a single buyer web lead.
Showing Agent – They should be showing homes to buyers.
Closing Assistant - This is the five to ten hours of closing work that needs done after buyers sign a contract. For some teams, a buyer’s agent does this work. For others, the closing assistant does the work. It should always be the closing assistant.
Does it sound like you need help with this? Call me, email me or reply to this blog.
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