YesTalk-242 - How to Never Cut Your Commissions

Welcome to Kevin Ward's Yes Talk for Realtors.

This is Kevin Ward. Today we're going to talk about how to never cut your commission again. That's right. You can build a business where you don't ever have to cut your commission. Now, this is not a right, a conversation of right or wrong, or is one better? You know, for somebody that cuts their commission, is willing to negotiate their commission, are they like inferior to the person who always charges full service commission? These are all different business models. That's kind of like saying, is Walmart less worthy of being successful than Nordstrom because they sell stuff for cheaper? No, it's just a different business model. So this conversation is really about choosing what kind of a business model do you want to build as a real estate agent. And if you believe that real estate agents are, is a noble profession and that you are worthy of your value, please give this video a thumbs up because that helps me and it helps you understand the value that you can deliver as a real estate agent. So there are three keys to being able to never cut your commission again. But before I even get to those three things, I want to talk about first a preliminary key. And that is if you want to never cut your commission, it starts right here with your mindset. And that is that you have to believe in your own value. That you have to believe in the value of the services that you, the quality of the service that you provide. You got to believe in yourself, you got to believe in your own expertise, your own quality. And you've got to believe in the value of paying for, shall we say, high end stuff. Okay? Because see, I was raised with this idea that, look, when you shop, we were taught to clip coupons, to shop for everything on, buy everything on sale, and if it was ever anything that was negotiable, haggle on everything. And so that's what I, that's how I came into real estate, is I was kind of like, I was kind of like the broke shopper. I'm the one that's always looking for the best deal, looking for the discount, will you cut your commission? All that kind of, that's what I was, that's how I would do it. So guess what? That I attracted that. And then I started meeting some people that didn't think that way. And I would get listings, and especially in the nicer homes in the nicer areas, I would get these listings and they wouldn't even ask about the commission. They just like, where do I sign? They'd sign. I'm like, you didn't object about the 6% commission. I mean, that's a, this is an expensive house. That's a lot of money. And I remember one guy in particular. His name was Roy Thomas and he was my first million over $1 million listing. He was a millionaire. He was a business owner and entrepreneur. And I can remember after I sold, I sold his house, they helped him buy another house after less than a year. He had remodeled it and he's like, I just never liked the house. Come sell it. And we came back and sell it and sell it again. And I'm like literally debating, should I discount the commission? Because I mean, they just bought it less than a year ago and I never said anything about it. And after I sold that house for them and bought, they bought another house. We went to lunch. He invited me to lunch at the country club. So I went. And I remember having this conversation. I'm like, so I got a question. I'm like, you've never asked me, even after we did all these transactions, you never asked me to discount the commission. Why not? He said, because I expect you to deliver great service and get me the best results. And I think you're worth the money when you do that. And he said something I'll never forget. He said, I make a lot of money so I can pay for the best services and always get the best. And I just, that, that stuck with me. Like, okay, here's a guy who's, who's owns. He makes more money than I've ever seen before. He owns nicer houses than I ever lived in before. He drives luxury vehicles. His wife is decked out in nice jewelry. Just obviously they have the great lifestyle, they have a great marriage, they have a great business, they make a lot of money. And I'm like, I like this guy. But I also like the way he thought. He's like, I like to make money so that I can not have to think about the cheap, not have to think about how much something costs and trying to be cheap and trying to haggle and negotiate. And I'm like, okay, I like this thinking. But I also decided I like this kind of client. And what I discovered was, is it wasn't just the high end clients. It was just people that there were people out there who simply had no problem paying for a quality, paying a quality price for a quality service. They looked at it as an investment. And this is one of the things you've got to believe as a real estate agent, that when you are better than everybody else, when you know how to be the best at something. When you've developed the skills of how to get a better result that you are actually worth more, you're not just a doormat in a warehouse full of doormats, which is the way a lot of people look at real estate agents, right? So how do you actually get yourself to a point in your business where you never, ever have to cut your commission again? And I'm going to give you three things, three steps. Number one is greater expertise. Is you've got to establish and create and learn to have a greater level of expertise than other real estate agents. How good are you at getting a better quality result for your clients? If you're working with buyers, are you better than the other agents out there of getting that buyer the house that they want for the price and terms they want? And especially in this crazy market, for when you're dealing with multiple offer situations all the time, do you know how to win for your client and you're better at it than others? That is expertise. That is actually learning a skill set to help make that happen. And for listings, do you know how to position the property in the market, how to market, how to do elite marketing that actually increases the demand, that helps you get better offers? And then once you get those offers, do you know how to negotiate on behalf of your seller to get better terms, a better price without having to give away their equity during inspection contingencies and appraisal contingencies and all of that? And those are skills that you can learn to become an expert. Because look here, here's the thing a lot of real estate agents don't understand is that back in the day, your value as a real estate agent more than anything else was simply that you had access to information that nobody else had access to. A real estate agent, you had access to how much homes are actually selling for to the entire inventory. And if a buyer wanted to see the houses that were for sale, they either could drive every street in town, look for sale signs, or they could talk to a Realtor. And a Realtor was the one who had access to all the data, all the stuff on the market, the stuff that was advertised in the newspaper and the stuff that wasn't advertised in the newspaper, the new listings, they had access to information to market data. To be able to do a market analysis, you needed to have access to the mls, and you didn't have instant valuations online. Nobody had that. So they needed a realtor for information. Because today information is. There's an abundance of free, ready Information on the online that almost any buyer, seller, they can have more information today for free than a skilled real estate agent could have 30 years ago. So they don't need you for information anymore. What they need you for is elite marketing skills that can help you increase the demand for a house to get better offers and elite negotiating skills that you can use to help get better terms and a better price for your sellers and eliminate contingencies. In other words, you're better at helping your clients win greater expertise and getting greater results. That's number one key. Can you actually be worth more than the average real estate agent? And the answer is absolutely you can. The question is, have you made that commitment? The second thing is, the second key to being able to never cut your commission is a better experience, is creating and delivering a better experience for your clients. So what level of service, what level of experience do you deliver for your clients? Do you deliver a level of service and treat your clients like they're going to the Four Seasons or like they're going to Motel 6? Now just think about it for a minute. If you go to a Four Seasons, you get treated different than if you go to the Motel 6. I know I've been to both. I've stayed at 4 at Motel Sixes back in the day, and I've stayed at Four Seasons. And I know at Four Seasons, not only am I going to get a nicer room and nicer pillows and nicer everything, but I'm also going to get a better level of experience. I'm going to be treated different. I'm going to be treated different by the staff. I'm going to be treated different with different amenities. Somebody else is going to carry my bags and guess what, I'm going to pay more for a higher level of experience. So when you create a higher level of experience, a VIP treatment for your clients, you have more value. And the people that are attracted to that are the people who are more likely to be like Roy Thomas, that don't mind paying for that kind of stuff. Okay, so we're not just. So just think about it this way. How do I deliver a higher level experience? Better communication, more direct communication. I go above and beyond. Instead of just giving them a closing gift, we also give them a pre listing gift. One of my top coaching members, Eva in Pasadena, she has what she calls the wow coordinator. And the wow Coordinator is the. She's the one that says, how do we wow our clients? So they do. They make their gifts, custom gifts. So they find out, they go into their Clients, social media profiles, and they research. They like, what do they like? What are they passionate about? They find out they're passionate about something, they go like that. We're going to get them one of those for a closing gift. We're going to get them one of those as an anniversary gift for them. As a past client, in fact, I heard her recently talking about that her wow coordinator saw online on Instagram that one of her clients was saying, I need some bubble wrap. Where do I buy bubble wrap? And so within an hour, Eva's team had sent. She had sent one of their team members to the store, bought bubble wrap, and showed up at the client's house with a box of bubble wrap. And the client was like, wow. How did you know? Can't believe you guys did that. It was just a higher level of service and expertise. And they call that their wow coordinator. So on move in day, when you've got a client and they're moving into their new house, are you going to send them a. Send them a pizza or are you going to send them a full catered meal? Now, they're both great. It's not like one is better than the other. One is right and one is wrong. It's just like one is going to be a different level of service. And whenever you deliver that different, higher level of service, people think different about you. They think different about your value, and they like the way you treat that you treat them and the way they feel as your client, by the way, they're probably going to give you more referrals. And because of that higher level of experience, and this is something that we've seen happening with our top coaching members who have taken this approach, is that literally they now have the video testimonials from past clients who not only say, this was the best experience and I have, you know, the best results with my agent, and some cases, they're able even say it, and they actually were more expensive than the previous agent we had, or their commission was higher, but it was absolutely worth it. So now what's happening is commission can be higher because the value is actually higher. Now those are the two things that I do to become more valuable. Number one, greater expertise. And number two is create a better experience. Number three is where I can get to where I never have to cut my commission again. And that is simply, this is have an opportunity, excess. I need more. I need an excess of business opportunities. I need to be able to generate more leads than I need because not everybody's going to stay at the Four Seasons. Not everybody's going to want to go out and buy the expensive stuff. Some people aren't going to want to do that. Some people are going to only pay 4%. They're going to only do discount. I need to have enough business. You want to generate enough business and have enough people that are wanting to hire you and use you that I don't. I'm not put in a position where I have to say, oh, I know, okay, I'll do it, and where you have to give in on the basis of a fear of loss. I'm afraid I'm going to lose the listing. I'm afraid I'm not going to get the deal. I'm afraid I'm going to lose the client. What you want to do is you want to generate enough business I can stay true to my value. And when somebody says, well, somebody else said they do it for this, will you do it for this? You say, I don't discount my commission. Can I tell you why? Because I don't have to. Because I deliver better results. So I don't deliver discount results, which I'm assuming you don't want discount results. Right. And the reason that people pay me more and I don't ever have to discount my commissions is because I always deliver a better result for my clients. Now, if you're looking for the cheapest guy, if you're looking for the cheapest agent, I'm probably not your guy.

But I.

But if you're looking for the best results and the best experience, then that's why people hire me. And I can say that knowing that there's some people going to go like, okay, well, I'm not going to do it. And I can be like, okay, that's fine. You see, there's some people that are never going to pay $400,000 for a car. Yes, there are people that pay $400,000, $500,000 to buy a Rolls Royce. But Rolls Royce knows that, that not everybody's going to go out and buy four and five hundred thousand dollars cars. They have enough business. They don't need to create a 80,000 or a $40,000 car for somebody. Why? Because this is what we have. We deliver the best car, we create a high end product and we charge a high end price. And when you have set that value of yourself and you've developed the skills, the expertise and, and deliver the experience that justifies that level of commission, that's how you win and have enough business coming in that you generate in a business that I can say no to people that don't want to pay my price. Now here's the biggest mistake and here's the thing that I want you to understand is it's not just a matter of going, well, I'm going to only charge a full service commission. I'm never going to reduce my commission. The problem is, if you're trying to charge a Rolls Royce commission but deliver a used Honda level of service and expertise, don't do that. Don't be that person. But when you deliver the best, you can charge the best. So what do you think? Let me know your comments. Let me know your thoughts. I know I'm probably going to get some haters on this one, but I want to hear what you have to say. Put the comments below and I will see you on the next video. Hey there, it's Kevin.

I hope you enjoyed today's podcast. Are you tired of getting no after no when you're out there trying to get listings and trying to inspire sellers to say yes to you, then I'd.

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