A real estate coach argues that transaction volume doesn't equal success. Top agents file bankruptcy despite high sales because they ignore margins and profit. Track your gross margin, hold agents accountable, and build a business that survives downturns.
Quickly tell my story, because all of you have heard my story. But what I bring to the table for most of you is the ability, like when I, and I always look over to my left side here when I do it, but when I look back and I look at the dots to how I got here and I connect them, it's like nowhere near a straight line. So I feel like if I can tell you what I did, what worked and what didn't work, that's probably some of the most valuable teachings that I'll, that I'll bring to everyone because there are, I was just on the phone with, with someone that goes to, you know, some of the same conferences I've been to in the past. And you know, he, I asked him, I said, do you really think that that conference is worth leaving your three year old and your six year old at home for four days, you know, missing them being away from your business, not doing sort of just basics of real estate and, and you're going to be no farther along in building what we just discussed. So I've been to every real estate conference you could possibly go to. I've seen every iteration of how real estate is done. The challenge with this, this guy in particular was that, well, he likes, he gets inspired by the people at these conferences that are doing so many transactions. And I said, I wish you could see their financials because I know some of these bigger teams and what their financials look like. And unless you set this thing up right to begin with, just ask them what their gross margin is. One question be like, okay, so you take in gross commission income, you pay your agents, and then what's left over, what percentage left over? And you'll be surprised how many people don't know the answer. You know, I've got. So I'm in ReMax and I'm 14th in the country for ReMax. Our team is. And within a few spots of ours, I know there's a guy that has 50 agents on his quote unquote team and his gross margins are probably 10 or 15%. So he offers no value. It's not at all a team and he's just not profitable. And there's so much risk in his business because he doesn't have the, he doesn't have the margin to be able to support any kind of downturn. So just be careful who you ask, you know, be careful. You make sure you know what you want your outcome to be and to know why you're doing it and to go down this path with me. You Must. You should have a very clear idea that you. You want a profitable business where your agents don't hold you hostage. I just had a quick call with someone who just came on recently, and he was talking like, his agents don't prospect, and that's why he hired about isa. And I was just asking him sort of basic questions about. Well, when you meet with your agents once a week and you go through what they've done and he doesn't do that, there's no accountability. There's no buyer system in place. So anyway, so a bit of a ramble here, but let me just kind of get into it. And then I want you guys to just introduce questions as we go along, because that'll kind of. Kind of break things up. Yeah, Kirby. A big amen from Kirby. Cause he knows the. Look. Look at this. This is a good one. This is typical, too. Kirby said there was a dude in my market that was number one in the state. The same year he filed for bankruptcy, made 2 million bucks, and spent 2.1 million. That is typical. You know, everyone is talking about the number of transactions they do, and nobody talks about gross margin or net. Net profit. Nobody. You'd be surprised. Talk to somebody about it, and they'll be like, oh, and talk to. Ask them how much credit card debt they have. Ask them, like, if their spouse likes them, if their children, if they're, you know, present with their children, if they're in any kind of physical, you know, in any kind of quality, Physical shape, the quality of their relationships and their finances. Ask them what their net worth is. You know, how much has their net worth increased over the last one, two, or three years. And some of you. I'm talking to some of you that just came into the program here, and you sort of. You're at the beginning part, so you don't really know what I mean. These are questions that you'll be able to answer very soon, I guess, is what I'm saying. But that's sort of typical that people make money and. And they spend too much and they track nothing.
