[ad_1]
Whether I’m coaching individual estate agents or simply discussing the various challenges that we face on a daily basis with colleagues or agents around the country I’m (too) often confronted with a common refrain when offering advice…
“It’s different where I am.”
Now I fully accept that each village, town and city around the UK has its own peculiarities, challenges, and benefits – that much is obvious. However, when it comes to choosing an estate agent most, perhaps all, potential sellers have basically the same needs from the company or individual they choose to sell what for many is their most valuable asset… and believe me it’s VERY rarely the lowest fee.
Let me share with you a recent experience which is typical of many conversations I have with agents who are convinced that clients in their particular location are somehow “different” and focussed on paying low fees.
“People in my area just won’t pay more than 1% plus vat and many of my competitors charge .75% INCLUDING vat.” I was told. “Everyone around here just wants everything on the cheap – it’s just that sort of an area.”
With propositions such as this I normally start with what I refer to as a “fact establishment phase”, which is what we did. Interestingly our analysis proved that it was indeed true that many of the agents in this particular big town did actually charge 1% (+vat) and there were even a few (well actually one!) that offered a fee of .75% including vat. I was also told that one estate agent offered to sell a home for free, though upon further investigation this was not actually the case – surprise, surprise! So far you might be of the opinion that the agent had a point and that compared to other locations around the country, this was indeed a “different” market place operating under different rules to the rest of us.
The next stage of our analysis involved checking the market share of available and sales agreed properties of the various agents in the locale and guess what? There was a clear correlation between the fees charged by estate agents and market share and that correlation was the complete opposite of what was expected. The cheapest agents generally had a much smaller market share than the more expensive agents who actually tended to dominate listing and sales volumes compared to the cheapest ones. In my experience this is a very common situation and I would go further. I would suggest that charging higher fees and offering better marketing and service levels actually INCREASES the chances of securing instructions and ultimately sales. Consequently, I would contend that this exercise demonstrated causation not just correlation.
I’m not sure that my client was fully convinced, even when faced with what I considered to be overwhelming evidence to support my view.
Which brings me to my main point, the “cheap fee issue” really is in the mind of estate agents and is not normally in the minds of potential sellers. Sure, nobody wants to pay too much for any service but what is too much? There will always be buyers of goods and services that want to pay less and I am reminded of the quotation attributed to John Ruskin…
“There is hardly anything in the world that some man cannot make a little worse and sell a little cheaper, and the people who consider price only are that man’s lawful prey”
And there you have it! In my experience, most people are looking for value and not simply a cheap price or fee. If you as a professional estate agent and salesperson are unable to convince a potential seller that your proposition isn’t worth a little (or even a lot) extra, I would respectfully suggest that the problem is with you and not with the customer. It may be that your proposition is not actually worth the additional fee or that you have failed to communicate key the differences of your services effectively. Either way it’s your problem, not the customers!
Furthermore, I believe that this contention is indeed universal, certainly not geographically specific and consequently I have a three word response to those who say “It’s different where I am”…
IT IS NOT!
Simon Bradbury is a consultant specialising in securing new instructions and runs a (very) small estate agency powered by eXp.
[ad_2]
Source link
