Come Together: How to make the agent teams business model work for you.
By Mary Beth Klatt
Brian Ladd, CRS, knew that his team was on the right track when they started to lay awake late at night agonizing about a local cutting-edge townhouse development in downtown Bend, Oregon, that had been on the market for months with a previous agent and still hadn’t sold.
In fact, Ladd, principal broker with Ladd Group at Cascade Sotheby’s International Realty in Bend, has found that fretting over a sale at 2 a.m. is sometimes critical to an eventual sale and a relationship that lasts long beyond the project. “When my agents and I lie sleepless at night when a project is not selling, we become connected on a level that ensures success with sales, and loyalty from the developers and clients,” he says.
Emotional investment is only one component that helps an agent team—a group of agents who share duties—thrive. While these teams generally operate within a brokerage, they frequently have their own rules on how to split responsibilities and commissions. While they have become extremely popular in recent years, the business model might not be right for everyone. Here’s what you need to know to create a successful and profitable agent team.
1. Play Nice in the Sandbox and Share Leads
That’s right. Ladd contends that being selfish with leads, clients and relationships hurts everyone. “That is when fear and desperation set in, which leads to team failure,” he says. “While this may sound corny, I honestly want my agents to be incredibly successful in all aspects of their life and eventually to be more successful than me.” An agent team allows him to scale the business by gaining help to represent projects and clients that he could not serve on his own.
“However, my primary goal is simply to grow the careers of my agents,” he says. “I think a huge mistake of team leaders is to be afraid to let their agents work with their clients. Many team leaders are fearful their agents will eventually take over those relationships, and when they eventually leave the team, the business will go with it. While many think I am naive or shortsighted, I am happy to let my agents adopt my client relationships.”
2. Find the Right People
Write a solid plan of what you envision the team to be now, in two years and in five years, says Susan Sedoryk, CRS, Team Sedoryk Properties with Coldwell Banker Legacy Realtors, Rio Rancho, New Mexico. “Then recruit those individuals who most closely align themselves with your personal and professional values,” she says. “I equate it to a prenuptial agreement prior to a marriage! We spend so much time together, so it’s imperative that we know and respect what each other’s contributions are to the team.”
3. Teamwork
“I feel the biggest mistake is to let agents who are not part of the team work at an open house or sales center waiting for walk-in business, or conduct open houses on your listings,” Ladd says. “Without really being part of the team, they will never be as engaged in the process. Having a project for your agents to work also gives them a springboard for their careers. It changes from randomly looking for business to having a core focus that eventually grows into a diverse client database.”
4. Establish Specialized Agents
“I have been able to represent my clients at a level that is simply unmatched by individual agents or by teams in name only,” Ladd says. “With specialized buyer agents, listing representatives, a marketing director and contract coordinator, we offer a seamless process that avoids crisis. We closed 250 sides last year with virtually no chaos. I know agents who do 10 percent of that business who live in continual crisis mode, which is bad for them and their clients. “
5 Interview Questions for Prospective Team Members
Edward Perez, CRS, broker associate, team leader–NJ Luxury Group at Sotheby’s International Realty in Hoboken, New Jersey, uses core values to interview prospective team members. “They help us know right from wrong and become an unwavering guide pointing us in the right direction,” he says.
Consider asking:
1. How are you committed to improving your skills?
2. How are you accountable to team members? Yourself?
3. Can you provide an example of how you helped a colleague succeed without getting the credit?
4. How committed are you to delivering WOW results?
5. Can you give me an example of how you demonstrated personal responsibility in a previous position?
5. Delegate, Delegate, Delegate
Diane Beck, CRS, broker, Windermere Real Estate, Missoula, Montana, has found a team approach lets her work remotely more easily and keep up with other responsibilities. “My team is managed well and streamlined to function without my daily presence,” Beck says. Her greatest challenge is keeping up with email. “It takes a special team to manage things while the ‘boss is away,’ and I have been fortunate to have that in place over the last few years,” she says “It is also critical to make sure our sellers and buyers understand the ‘team concept’ up front—they are more likely to be comfortable with the knowledge of how we operate at the start.”
6. Potential Drawbacks: Thin Margins, Splitting Commissions
With the team approach, you’re more likely to be focusing on leadership and human resources issues rather than sales. Another drawback is overhead. “The burn on ongoing expense quickly builds when you add large marketing spends and salaried positions,” Ladd points out. “My margins are much thinner than as an individual agent, and my overhead averages about 45 to 50 percent of gross commission. In a slowing market, this could quickly eat your commissions. Even with a 50/50 split with my agents, I have surprisingly thin margins.”
There are also potential pitfalls for team members. For starters, they can get smaller commission checks than if they were working on their own. Some teams split commissions 50/50 with agents, with bonuses based on selling group listings and for taking the lead role on projects; others give a higher split to team members who generated the lead and/or if the property is not a team listing. Finally, team members can have less input on how the group operates and plans.
7. Be Emotionally Invested
Despite these challenges, Ladd has found it rewarding to learn new skills and grow his career differently. Ever since Ladd and his team quickly took over the languishing Bend townhouse project and sold out the first phase for a gross number of more than $5 million in three months in 2016, they have successfully turned around other insomnia-inducing projects.
“I am always asked what we did differently,” Ladd says. “Besides all the obvious action items (create a detailed marketing plan, identify the target demographic and market appropriately, create follow-up and CRM campaigns, etc.), my most succinct answer is that we became emotionally invested in the success of the project.” 
6 Tips for Hiring Your First Team Member: An Assistant
1. Create a description of a perfect assistant, one who will fit in your team culture and have essential skills.
2. Don’t write a vague job description.
3. Survey other agents to find out hourly rates, salaries.
4. Test applicants. Edward Perez, CRS, broker associate, team leader–NJ Luxury Group at Sotheby’s International Realty in Hoboken, New Jersey, likes Disc, a free behavior/personality test. Resist temptation to fill the job quickly. Don’t hire family unless they fit the job description.
5. Get your new hire up to speed on three to four tasks immediately.
6. Prepare to personally train your new hire unless you outsource the task. Training takes time.
7. Set goals for the next week, month and two months.
Download the team-building webinar series “Building a Team from the Ground Up” at CRS.com’s On Demand catalog.
