Are you worth it?
Mon 01 Oct 2007
The thorny subject of Estate Agency fees is constantly at the fore front of my mind. It simply amazes me how many of my colleagues in the industry have so little pride in the service they offer and are so ready and willing to compromise themselves and their business by cutting their agency fees at the drop of a hat. Do they really believe that their clients judge them so much on the fee they charge? If this is the case then I suggest they take a long hard look at the service they are offering and workout Am I worth it?
It seems to me that more and more of my better known competitors are cutting their fees more and more easily without any thought of the consequences for the future. There will always be room in any market for a discount agent, however I am surprised by how many of my competitors are placing themselves in this bracket when their service offering on the face of it they should be more expensive than the pack.
It does nothing for their brand and even less for their bottom line. So who is to blame for this sorry state of affairs? Im afraid I lay the blame at the feet of the business owners. It is one of lifes true-isms (if thats a proper word) that a salesperson is given the ability to find the easiest and quickest way to do something they will do it and there-in lies the problem; the strength of senior management to have a number of lines in the sand that cannot be crossed. If business owners were to step up to the plate and insist that their members of staff not only provide a great service but also charge a proper fee, our industry would in my view build a much better reputation.
In Australia you will pay between 2-3.5% PLUS marketing expenses, in America between 5-6%, in France 7-10%, in Spain 7-10%. How crazy is it therefore to cut that fee which is already amongst the lowest in the developed world in half and sometimes below 1%? To me it makes no sense and it is the reason that our industry is looked upon as it is- a reputation that in the vast majority of cases is unfounded. I constantly hear Estate Agents being almost apologetic in admitting what they do as if they werent proud of themselves and the service that they provide. Well, Marsh & Parsons operate in one of the most competitive real estate markets in the world, we have an average fee of well in excess of 2.25%, our market share has in some cases quadrupled this year and we have a policy of not cutting fees.
I am all in favour of competition it is part of life, however unless we are careful we will all sink to be judged against the lowest common denominator and the sad thing is we will deserve to be.