Altera Performance Group

You Deserve More Money

Posted on 13. Feb, 2008 by Jay OHare in Create Value, Money, Real Estate, Steamboat Springs

Just had breakfast with yet another broker complaining about yet another split adjustment by yet another managing broker who refuses to see the light. Desk fees, time in grade, tiered splits, volume splits – the circus goes on & on.
Here is what I see over & over again. I see brokers using their cell phone numbers on their ads along with personal email addresses. I meet with brokers on a consistent basis who are trying to either get a website or redo the one they have. I see brokers who spend 95% of their time out of the office. I see brokers who invest heavily in self-promotion. And yet the number one complaint I get is related to splits.

Why?

In 1988 it made sense for a managing broker to take a heavy split of your commission. It was extremely expensive to operate a business. Printing costs were enormous, early computers cost a fortune and of course the Internet didn’t exist. National TV campaigns drove serious business to the big franchises and the phones rang because of it. As consumers we had two choices to get in touch with you, dial a phone or turn a doorknob. “Floor Duty” was a lucrative use of your time because of that. So a managing broker taking 50%+ of your commissions made sense. The bulk of your business came from your association with that company.

Today, the complete opposite is true for most brokers I meet. The majority of their business comes from leads and clients they personally generate. Most brokers I meet view “floor” as time to get office work done. They view their association with a brokerage as “doing time” as required. And yet commission splits have remained almost unchanged.

So, I think you deserve more money.

You deserve to keep more of what you earn for the very reason that you’re doing more to earn it and your managing broker is doing less. You have more choice than ever before. Don’t spend yet another year hoping things will get better. If they haven’t by now chances are good they won’t. With companies like Colorado Group, there are alternatives to the commission split game. And it is a game, which most managing brokers should know is coming to an end.

Every evening a managing broker watches his entire company drive away. He can only hope that his company comes back in the morning. It’s my hope that the sooner managing brokers realize this the sooner they’ll approach their job differently. They are no longer the gatekeeper they once were. Their value has shifted to other areas. Maybe attend a conference or establish a new media initiative instead of adding yet another page to the split spreadsheet.