I was a partner of a seven branch estate agency for many years before the right opportunity to sell presented itself. We rode out the post-2007 downturn relatively unharmed, no branch closures and minimal staff reduction. Our six key lessons learnt may help you.
1 Don’t bury your head in the sand
“There may be trouble ahead…” the song says, but simply facing the music and dancing is not ideal. It’s critical to take action. Some agents are guilty of ‘the rabbit caught in the headlights’ approach, not accepting what is happening, stunned into inactivity. Face facts, assess actuality in concrete business activity, real current and upcoming expenditure and income. Don’t allow blind hope and misplaced optimism to cloud your decision-making. Agents who went out of business in previous tough times had many things in common – one being slow to recognise and accept reality.
2 Have a rethink
A wise man said, “There are two types of business – ones having a tough time and ones which will have tough times”. While they are inevitable, it is how you deal with them that separates survivors from victims. They are a chance to make hard decisions about what works and what does not. Challenges focus the mind on facing up to taking actions to safeguard the future and how you need to change your business.
3 Protect your client base
Hard times make it essential to keep people loyal to you – vendors sitting unsold will be prey to aggressive competitors, landlords must be retained as that regular monthly income can make the difference between success and failure. Service standards must be raised and adhered to.
4 Make things happen
Proactivity is essential. Shake off the malaise, book activities to create business opportunities – protect time for the team to phone their applicant database to winkle out viewing and valuation opportunities, slots for prospecting, contacting previous valuations, withdrawals, clients who moved on should be daily duties. There will always be a ‘must move’ sector to identify and dominate – the business within it is the lifeblood of agents in uncertain times.
5 Invest in your staff – and yourself
It is interesting in tough times to see how agents respond to investment – their attitude is governed by what sort of ‘war chest’ they built to help them through.
Our training company remains busy in harder markets, although demand comes from a lower number. There’s a polarisation of views: “Tough market, can’t afford training” to “The market is tough, I need to do more training”.
Don’t ignore your own training needs. A mentor who has survived difficult market conditions will be an invaluable source of support and guidance. Read books, sign up for webinars, undertake online training, attend industry events. You need to be the greatest agent and leader you can possibly be, so give yourself the best chance.
6 Embrace and effect change
Another common trait in agents who disappeared in the carnage of 2008 and 2009 was that they simply didn’t change enough. They worked damned hard – probably harder than ever before – but crucially not differently. Try new things, raise standards are all worthy introductions to your business in tough times.
Micro-manage the business: monitor all key activities more closely. Review newly registered applicants every day to identify imminent opportunities. Review performance against key targets daily instead of weekly. Some businesses have no targets in certain critical areas so the team isn’t clear on what success or failure look like. Scientifically calculate how many appraisals you need to do on a weekly or daily basis – every bit of business cascades down from there – proactively organise and undertake activities to ensure that target is reached. If you fail to do so, all other key performance indicators will be missed.
Estate agency branch closures and redundancies have been widely reported during the first months of 2019 – a continuing trend for a while.
Following these six rules will massively increase your chances to avoid being one of these sad statistics. Time is of the essence. Those slow to react will pay a high price.
A Chinese proverb: “The best time to plant a tree was 20 years ago. The second best time is now.”