You might find it interesting to hear what Paul Davies from One Agency thinks is the future of the industry
Topic – Truly independent
Mentor – Paul Davies
- Unfolding in front of us
- Get flexible
- Not how much you make but how much you keep
Developing your leadership style – Jacob Aldridge
Getting to know the risk profiles of your team members and why that is important
Kevin: Well, as I promised my guest Paul Davies from One Agency is with me again this morning, and we’re going to talk today about the future of real estate, the business. Should we be more mobile? Should we be more flexible? Certainly with models like One Agency you get that ability.
Kevin: Paul, welcome to the show once again and thanks for your time.
Paul: My pleasure, thank you.
Kevin: The future of real estate, what a challenging topic that is. Where do you see it going? Because I see that you and the One Agency model are very much a part of the future. You’re helping to reshape how the agency model works, how the agent works, and how we interact with buyers and sellers. So where do you see it all going, Paul?
Paul: Yes, in the absence of a crystal ball, it’s a very good question. Look, we identified back in 2008 when I created One Agency, we had zero members and now we’ve got over 600 agents across Australia and New Zealand. We identified back then that there was a gap where agents want to be more empowered is a good word. Empowered by running and owning and operating their own enterprise. They can run it their way, they don’t have anyone telling them what to do. The rewards of their efforts flow back to them and their families. That was a need that I identified. I think that’s a growing groundswell of agents that are seeing other agents doing that, stepping up, doing something different, and going, “Yeah, you know what? That looks good. I’d like to do that. I didn’t really think business ownership would be for me. But I think we could have a look at that.” They’re surprised as to how easy it can be.
Paul: That’s really the future … Is unfolding in front of us now, Kevin, is it is getting easier and easier and easier to do business. Not just real estate, any sort of business. Whatever industry you choose to look at. It’s getting more streamlined, it’s getting more efficient. The olden days … We touched on this earlier in the week, the olden days of going and opening up a big shop, or having all those expenses, you can if you want. We have some of our members that do that and they’re very happy with it. But the majority of our members, 60% plus, are operating a more-
Paul: Flexible, mobile, economical business. Because … I’m blue in the face saying this to my members and people generally, it’s not how much money you earn that counts. It’s how much money you get to keep after expenses is the only measure of success. Often the agents … And no disrespect they’re like chest-beaters, look I sold 10 last week or whatever, I’m pleased for them. I go, “Look, that’s great. I’m thrilled. However, can you please tell me how much you kept of all that work you’ve done?” Because that’s what I need to know, and that’s where I’d like to work with you.
Kevin: That’s where your model is totally different from the others, that are so relied on those agents getting those sales because of, say, a franchise fee. You’re on a flat fee model, so I guess you’re more invested in the success of the individual, how much they’re taking home themselves?
Paul: Yes. I believe business operating costs should be fixed wherever possible, and determinable moving forward. So for us, our members, they know that we’re under $1,000.00 a month fixed fee, so right, that’s what that’s going to cost. Mobile phone plans, we know what that costs. You can identify every single business expense in your business, and you can say, “Okay, I can see that my business is going to cost me $4,200.00 a month to run in total. I’ve got the funds for that. I know that I’m earning 250 GCI per annum. Gosh, this is going to work. It’s only going to cost me $50,000.00-$60,000.00 a year to run my business. The rest is mine.”
Paul: The big advantage to that, Kevin, is that it’s scalable. So when your business operating costs are set and fixed, the more you earn the more you keep.
Kevin: Mm-hmm (affirmative).
Paul: Not the more you pay.
Kevin: Paul, can I ask you why you started One Agency? What was your “why”?
Paul: Well, I owned two major franchises; a Ray White franchise for 10 years, PRD Nationwide for 10 years. During and after that I opened two boutique businesses. I said to my wife one day after the franchise operations … I’d let go of those, I said, “This boutique business is absolutely fantastic. Because it’s not costing me $200,000.00 a month to run the monster. It’s costing me $2,000.00 a month.” That was a real eye-opener, Kevin, it was a light bulb moment. I thought, my god, how long has this been going on for? I always thought you needed to have all that, which you don’t.
Paul: But what I worked out was … And from experience again, I was having trouble competing against other agents who were under known brands with all the bells and whistles and blah blah. Some of those agents I wouldn’t have employed, and yet they were beating me to listings. So I said to my wife again, “Something’s wrong. It’s not right.” Then I came up with the concept for providing good individual agents, like myself, with a corporate backdrop but proper marketing tools, proper branding websites and all the other essential tools that a top-line agent needs, delivered economically, and leave them free to do what they do best. That’s how One Agency was born.
Paul: Hard to get off the ground, to be honest. Four years it took me, just to get a handful of members. But then once it started to get a life of its own, and I didn’t have to talk … I’d say, please talk to Kevin, Bill, Jane … Whoever, they’re all members. They’re having a great time. They’re earning fees, they’re running their businesses economically, and they’re free. They’re free to run their business the way they’d like to. So it grew and the momentum kicked in in about 2012. So that was four years after launching it. It’s just gone through the roof since then.
Kevin: Yeah, well done mate. Great explanation, nice to hear your “why” too because it’s very important. I want to ask you tomorrow, just to round the series out, for you to describe the typical successful agent as you see them, both agency generally or One Agent. And also your tips for aspiring young agents. That will be tomorrow when Paul Davies from One Agency comes back to join me. Thanks, Paul.
Paul: My pleasure, thank you.