Syndicated from e-Partner

Owners are engaged in the delicate balancing act; walking on the razor’s edge, barefoot.

Slicing into Profit

The razor upon which owners must balance themselves is now slicing so deeply into revenues that profitability is now proving more and more illusive. Today’s Broker/Owners are confronted with an economy that is not rebounding fast enough to enable them to survive.

e-Partner has long held that Broker/Owners are the financial backbone of the real estate industry and that their survival should be one of the top priorities of our industry through 2010.

Our Bleeding Feet

The razor’s edge takes no prisoners and yields no concessions to owners who are struggling to meet their ever increasing general operating expenses. Trapped by the same economic factors faced by other businesses, owners are looking for ways to decrease fixed and personally guaranteed obligations.

e-Partner talks to owners from every brand and those who are independent and the story is generally the same. There are simply too few closing and too much bricks-and-mortar operating expenses. “There is just not enough transaction commission to meet the monthly demands we have,” one broker/owner told us.

Mandatory Agility

Agility, created and sustained, is the first of the Ten Commandments of the New Real Estate Economy.

Although we are not quick on our feet, the razor’s edge is sensitizing us to perils of standing still for too long in one place. Our bloated organization body weight presses down on the sharp stainless steel edge and this slices away large chunks of capital required to sustain retail models.

New principle: the razor’s edge is now an owner’s continuing reality and he/she/all of us will learn to walk on this edge nimbly and quickly or, we will be cut to pieces.

Dancing to a New Beat

Dance or be cut! The stakes have never been higher. But can owners find revenue, create revenue, jettison unnecessary expenses and learn the new beat fast enough to escape the razor’s edge?

Short answer is yes. The long answer is that we can only only escape the razor’s edge if there is the will to accept the truth that some of the old operating fundamentals are no longer adequate and may never be.

Many brokers are holding on, digging in, hunkering down, waiting for the much discussed and heralded market turn-around.

Standing still on a razor’s edge is not recommended. What we do recommend are these immediate actions:

1. Redirecting bricks-and-mortar costs to new market penetration models that can reposition your brand, create recruiting opportunities and new transaction revenue. Shift from facility management and uni-market branding to horizontal branding and multi-market management. ASK US HOW.

2. Include fee-based cash flow models as a part of your total market revenue model. This includes remodeling for up to 65% of you agent team being fee-based agents…AND…including pay for placement models where local supporting services such as insurance companies, new homes contractors and property management companies become total market revenue partners with your firm via flat fee online ad positions. ASK US HOW.

3. Acquire and merge with smaller companies that can open markets to your brand in minor and intermediate markets and create these acquisitions with a “work from home” model, such as e-Partner advocates. This M&A approach allows an owner to expand his/her company without the corresponding capital demands associated with traditional business models. ASK US HOW.

4. Develop and implement consumer-centric social networking models and make them a part of the core personality of your company. Pursuing transparent Internet models that bring the consumer into a partnership with your online presence. There are reasons for the success of Twitter, Facebook, MySpace and YouTube. Consumers want to be empowered to express themselves and create online presence through dialogue. ASK US HOW.

Should the current economic trend continue for 2-3 years it is predictable that many organizations will be forced to close their doors. However, Broker/Owners are still in a position to re-define their business models by cutting and redirecting expenses into affordable growth models.

Our websites will not save us. Our brands will not save us and technology alone is not the solution.

However, understanding the economic eras of the real estate industry and how technology dictates and defines Broker/Owner profitability can help Broker/Owners see the relationship between their models and current trends. Please watch this presentation and post your comments.

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