The Most Important Customers Of A Brokerage May Be Its Agents

The >But others come to mind as well. State laws require brokers to exercise varying degrees of control over their agents. Simply put, the broker is responsible for seeing to it that the agent acts within the law and does things the right way. Most brokerages develop substantial sets of rules and procedures to ensure that their agents act properly. When viewed from this perspective, the >And, of course, there are other >All of these have their place and their use. My purpose here is to suggest another model for the agent-brokerage >To be sure, the commission money that comes in the door ultimately comes from principals -- buyers and sellers. That money is then shared between the brokerage and the agent. Think of the portion that goes to the brokerage as the price the agent pays for the services that the agent receives often advertising, office space, managerial support, etc..

Now, this may seem to stand the model on its head. "No, no", some will say, "it is the brokerage that brings the customer to the agent; and the commission split to the agent is what the brokerage pays him or her for handling the transaction."

Maybe that was a more accurate way to look at it in the past. It was the brokers adds, office location, and reputation that brought the consumer in, and it was the brokers investment in the office and its infrastructure that enabled the transaction to be processed.

But thats not how it works today. Computers and the internet have changed all that. Individual agents today have the tools and the ability to generate leads, advertise inventory, and develop and maintain data bases that far exceed anything a brokerage could do twenty-five years ago.

While it might be technically and legally true that a principal is the customer client of the brokerage, in reality, principals are the customer client of the agent. It is, for the most part, the agent, not the company, who provides the customer service experience that the principal will remember. For good or for ill.

It is all too easy for brokerages, at the management level, to envision their



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