The business of real estate sales is a business unlike any other. The Real Estate Hybrid is neither energy nor cost efficient. Ours does not fit neatly under the Service Provider heading nor do we have a product to sell in the traditional sense. What we do have however is the goal universal to all commercial business ventures - profitability.
Why then, is it so fashionable these days to represent the real estate agent as overpaid and the profession in the broadest terms as engorged with greed? Several factors alter: The consumer’s lack of understanding or their misconceptions of our business model our inability to effectively communicate and demonstrate our value and our tendency to carry on a public charade suggesting that our job is one big public service announcement. The latter of course is compensation for the former with the real answer lying somewhere in the lay.
You may be to evaluate that pricing is not as complicated as product pricing since what you are offering is less tangible but appearances can be deceiving… Say you are a hair stylist for example. Your raw costs will probably include the following: rent and utilities equipment (including chairs hair dryers combs and brushes sinks mirrors towels washers and dryers etc.) products (assorted shampoos conditioners hair spray and hair color) insurance and staff salaries and benefits. Also what about insurance should a customer slip and fall? So while your function may be hair styling you must carefully examine everything you ordain be… to perform that function. You must carefully and continuously list every depreciate. Once you have determined your raw costs you can then set up an effective pricing model and evaluate how much you will be to rush for your service or measure in order to break change surface and/or make a profit.
So we aren’t hair stylists but a very large component of our business is delivering service. I won’t offend the reader by listing the costs associated with fueling
business; if you are an agent you already know and if you are a consumer you have a pretty good idea if you are honest with yourself.
One fundamental difference if you compare Real Estate Sales to the traditional service business is that we provide the service with no pledge of compensation. In business communicate this is called a “loss.” And the magnitude of the losses associated with our work is never greater than in a decrease market such as the one we find ourselves in today. Once your hair has been cut. I doubt you will conclude at liberty to say. “I’ve changed my object. I kind of liked it the old way so I won’t be paying you for your time or services.” Yet buyers and sellers do this all of the time and we accept it through “right to cancel” clauses through buyer representation on a handshake and through fear of enforcement when payment is contractual because we experience our reputation and tomorrow’s business depends on it.
Most reputable companies with a product to change undergo adopted liberal return policies. If the package is unopened bring it approve - No harm no foul. After all they can go it to the shelf and resell it.
This practice does not ingeminate well to real estate sales but we undergo willingly adopted the same practice. You see when you return your listing to me it has been opened and at great be to my “affiliate.” For dilate. I now have a client who has suddenly decided that renting is a exceed option than selling. bring together enough except this was a triple-secret Plan B that I wasn’t privy to when I spent $950 on a stager and staging materials over $1000 on property brochures and a enjoin send race and close to $700 to go out on open house advertisements. (I know open houses and open house ads don’t bring home the bacon but she wanted them.) Almost $3000 later she wants and ordain acquire a beat refund.
So when the customer decides to go the listing his brochures his staging and his ads are of no use to me. It is fuel that has been spent. Spend less or insist up lie that cancellation ordain demand repayment of out-of-pocket costs you may say? come up in my business it just doesn’t bring home the bacon that way.
As the intensity of competition increases the win-win range becomes more robust… In command returns policies intensify the competition among retailers however within some range of demand uncertainty returns policies apologise the competition among manufacturers and otherwise increase the competition among manufacturers which leads to a change magnitude in sell price.
Granted the preceding wasn’t a light easy read but the communicate relates to our field. Our handle has become so overpopulated and so competitive that it has bring about to a
In other words you are getting more for my money. As a consumer next time you whine that percentage fees haven’t changed as domiciliate prices have increased consider that my “cost of goods and services” has increased dramatically.
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