Hello Everyone-I would certainly appreciate any and all feedback. I will do my best to help you in return. Thank you for your time.

I am opening a new brokerage-a local franchise in my area and I am trying to do research on commission structures for both new agents and existing agents.

It certainly seems easier to get this info for new agents. As for established agents, I am guessing this is a negotiated thing that is pretty flexible. My big question is if you own a franchise, how much flexibility do you get in setting this? My company is new and VERY flexible, which is nice.

I am looking for any and all feedback-I would appreciate it dearly regarding commission structures-I want to attract the best and I know it is difficult, so I wanted expert advise.

What is your stucture? what do you find appealing as an experienced agent? as a new agent? what can I do to attract you from another company? I want something fair to both parties.

Aside from these big issues, what advice do you have for us? Thanks so much for your help.

What's the franchise? That will help us in our discussion.

It is a local real estate company-i cannot really say b/c we haven't offically signed the agreement. They have about 10 offices right now. It isn't a Remax, C21, etc.

The home office really should have covered this type of guideline for you. What works best for them would be my first question.

They are very flexible-hence the smaller franchise-they are willing to listen to any commission split-even the keller william referral method to supplement income-just wanted everyone's feedback. do you think 40k is a good net income for the first year with 4 f/t agents and maybe an additional 5-10 p/t agents? i hope to make 40 or 50 first year after start up and go from there...

let me know if i am off base

That should be very do-able. First year stress is almost overwhelming. Capitalization is a very effective relief. I would expect to 'float' the business for almost a year. That should give you plenty of speed going into year 2.

Don't know if this helps, but NAR says that the average Realtor does 7 sides per year. I used that figure to plan my budget.

Carla-you had sent me an email previously-I just wanted to thank you for your guidance. That was extremely helpful. It is good to know there are people like you in this world:)

Tucker-what do you mean by float the business for a year?

Any other budget help? Any things I am forgetting when forecasting-what kind of unanticipated expenses came up that you hadn't planned for?

Cash reserves to pay all your expenses, including yourself.

I'll send you a simplified version on my budget on an Excel spreadsheet. Right now I am still in executive suites, and my only staff is a person answering and forwarding a few calls from their home. My expenses are pretty well fixed for now. I imagine that I will run into unanticipated expenses when we get our own space and a bigger staff. I have waived a few fees here and there, and I have had a couple of people get a little behind on their monthly fees, but nothing that has really made much of a difference in the budget. I should write it in anyway, I am sure. I did 3 different scerarios with 3 different levels of average production. It is certainly in my best interest to do everything I can to help agents in my office get their production higher.

Thanks Carla:) I sent you a follow up email.

I think $25K cap is pretty darn high to attract experienced agents. I looked at the 100% companies in the area and tried to keep my fees comparable. I'm a little higher than most of the 100% companies, but I think that even experienced agents are willing to pay a LITTLE more for the flexability. Oneof the more expensive 100% offices in town will cost you about $11K/yr to home office, and about $16K/yr with an office. Some are much less than that. I don't see a high producer willing to pay an extra $10K/yr for much of anything. You might have some success with new agents if you have a good training program, but I think you'll have a hard time attracting experienced agents.

i am starting to get the impression, the competiting on price is a no-win situation. how do you guys think about unorthdox method-daycare in the facility? a fun work environment? etc? maybe some asian massage..just kidding around that one...

I think the #1 reason that agents leave their current brokerage has nothing to do with splits. The reason agents leave is because of the broker. The broker is either too busy with their own business, there is no training or support, or the work environment is horrible. If an agent is happy at the brokerage then the agent will be more willing to ask their broker for more money.

any brokers out there provide services out of the ordinary?

I'm confused. You're neither an agent nor a broker, yet you want to open a Real Estate Office. As a new agent, I find it incredibly difficult to come up with business.

I wouldn't even dream of getting my brokers license and going out on my own yet. What makes you think you can successfully operate a real estate business with no experience? Other experience in business is great, but this business is not like any other I've encountered.