Gary Keller Speaks to REALonomics
Gary Keller and I first met via telephone sometime in 1993-94 for a discussion about “profit sharing” real estate brokerage business models. We’ve remained engaged in dialogue over a variety of issues for more than a decade. Off-and-on we bounce back into our overlapping universes to banter over one issue or another, picking mutual brains for insight with me benefiting most. His books, The Millionaire Real Estate Agent
Keller Williams Realty International is one of the franchise success stories of the past two decades and has emerged as one of only a few “New Model Math” brokerage concepts. REALonomics caught up with Gary Keller, the co-founder of Keller Williams Realty International, and captured the following insightful interview with this industry leader. Gary talks about “techno-babble,” “brandchising” and how our Internet models have turned into a help desk model that goes nowhere. Here are excerpts from our exceptional exchange with Gary. For the full interview, click here.
Gary Keller, Quoted
“When experiencing the downside of a cycle businesspeople (broker and agent) must do two things: cut expenses to the core and put focused effort around driving growth. You first have to protect your margin and then build from there.”
REALonomics: Keller Williams has seen excellent growth in the past decade, what are the core specifics of your economic model that serve as the fuel for KW’s acceptance in the market place?
Keller: I think it has to do with the economic soundness of our model. It was created out of the tough market of the late 80’s and is built on low risk and a managed rate of return…DOWNLOAD THE INTERVIEW
REALonomics: How did the books Millionaire Agent and Millionaire Investor change your role in the organization and how did it contribute to the success of KWRI? Are there more books coming?
Keller: Actually, these two books came about because of my role in the organization. I have always been a student of the real estate business and helping agents grow their business is a real passion of mine…DOWNLOAD THE INTERVIEW.
REALonomics: Some organizations, we happen to be one of them, think real estate franchising has reached somewhat of a saturation point. Do you think this is true in any way and if so, how does KW define its growth model for the future?
Keller: I really don’t think of it that way. There is “franchising” and there is “brandchising”. The industry is absolutely saturated with “brandchising” but not with “franchising”…DOWNLOAD THE INTERVIEW.
REALonomics: We are obviously out of the rapidly appreciating market run-up we all enjoyed. What is your advice to broker/owners regarding how they can weather the current financial storm in the lending industry?
Keller: The current market condition was inevitable. That is why we call it an economic cycle. When experiencing the downside of a cycle businesspeople (broker and agent) must do two things…DOWNLOAD THE INTERVIEW.
REALonomics: Do you think there are too many real estate agents in the industry? If so, why can’t this industry do what others do and cut back its labor force to create a better economic model? What’s our hang-up with respect to our come-one, come-all approach?
Keller: Yes, but that has always been the case no matter what market we’ve ever been in. Since the nature of our relationship between agent and broker is one of independent contractor it really has never been the role of the broker to decide how many people are or aren’t in the industry – only their company…DOWNLOAD THE INTERVIEW.
REALonomics: Do you think broker/owners are leveraging technology and the Internet in ways that truly make sense for themselves, their businesses and the consumer? Do you advocate paperless solutions such as tablet PCs for agents and back end transaction management technologies?
Keller: This is a tough question to answer. I think the bottom line is that most don’t know what they’re doing. Without a sound lead capture and conversion system in place, which most don’t have, the Internet is being run like a real estate help desk where all the information is given to the caller and then we hang up…DOWNLOAD THE INTERVIEW.
REALonomics: Are you seeing broker/owner profitability problems in the current market situation and do you think the industry is going to see the closing of doors with respect to real estate brokerage firms.
Keller: Those companies who can’t cut expenses to the core may truly have a tough go of it in this market we face right now. Those who can will be the winners coming out of it.
REALonomics: What question would you most like asked of yourself and what’s your answer?
Keller: What matters the most to you? And my answer is GOD, FAMILY and then BUSINESS!
DOWNLOAD THE ENTIRE INTERVIEW HERE.
Want to know more about Keller Williams? Visit www.KW.com.
Want to read Gary Keller’s books: The Millionaire Real Estate Agent
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