Is It Time to Build a Team?
You’ve had a busy year and want to keep it up, but you’re exhausted. The most obvious solution to some agents is to build a team. Done right, it’s a great idea. Done wrong, it can be disastrous.
Nine things to consider before starting a team:
Have you hit the wall? You can no longer keep up.
Are you at the point where you realize you can’t keep up with it all? The details are no longer being handled the way you like. Your customer service is starting to decline and you no longer have time to do those little things that endear you to your clients. You don’t have time for family and friends. You can’t remember the last time you had a date night with your significant other. You haven’t been to the gym in weeks. All of these are signs that something needs to change.
Does your volume warrant it ($ or #)?
The ideal time to start a team depends on your market and your average sale price. If you work in a higher end market, think about starting a team once your gross revenue hits $200,000 – $250,000 per year. High-end clients demand more of your time and marketing their homes takes more work. In an average market, think about starting a team once you reach 25-30 ends per year. A solo agent can handle up to 30 transactions per year with a good CRM system and well-organized files. Once you exceed this level, you’ll need someone to help manage the details.
Are you mentally ready? Are you willing to let go?
You can’t make a six-figure income doing $20 per hour work. Some people can do things better than you and delegating the work frees you up to focus on activities that earn you the highest return (e.g. prospecting). Don’t lose sight of the highest priority activities that earn you the most money. Are you willing to delegate or do you feel like you can’t relinquish control?
Are you financially ready? It requires an investment.
Starting a team requires an investment. You must hire an assistant, update your marketing, upgrade your systems, expand your office space, and buy capital equipment. There are costs for onboarding and training new team members. Don’t jump in without calculating the investment required. This is a big step. Prepare for it.
Are you a team player or an authoritarian?
To have a team, you must be a team player. It is no longer about “me” but about “we.” Are you willing to take time away from clients to mentor and manage others? Are you willing to let team members make mistakes? It is all part of the learning process.
Are you prepared to take a step backwards?
There are time and financial commitments when starting a team. Your business will slow down as you stop prospecting while training new members. Most people don’t realize that when you start a team, your expenses increase and your revenues decrease in the first year. It is a double whammy. Do you have the cash reserves on hand to make it through the transition year?
Do you have the skills? You must know it to teach it.
You must master the business before you start a team. You can’t teach someone something you don’t know yourself. You can’t depend on team members to make up for your shortfalls.
Do you have a broker’s license?
If you are going to manage a team, the best place to start is becoming a broker and understanding the business at a higher level. Your team members will come to you for advice and they expect you to have the answers.
Do you have the tenacity? You must really want this.
Your desire to take your business to the next level must be strong or you won’t have the tenacity to get through the transition. You can do it if you really want it, but the climb to the top won’t be easy! Hire right, train well, build loyalty, and be willing to let people go if they don’t measure up.
If you are considering starting a team, you need to understand where you are now and where you want to go. This requires a detailed business plan. You must also determine WHY you want to build a team. If you don’t have a profound reason, you’ll give up at the first challenge. If you have the desire and you have the cash reserves, considering hiring a coach to help you execute your plan.
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