How do business experts look upon 100% commission models? Many business leaders agree that 100% commission structures encourage real estate growth.

Real estate brokerages along with other types of businesses offer 100% commission models.

Let’s explore…

 

Advantages of Commission Based Companies

 

The Harvard Business School Review provides a good source in order to answer this question. One of their articles explains the advantages of paying a commission. A big advantage entails increased motivation amongst employees to help the company grow.

The following reveals the advantages of commission structures for a company according to the Harvard Business School Review:

• Motivation – Every employee motivated to help the company with increasing revenue.
• Stability – Company stability increases the ability to pay employees compensation.
• Hard Workers – Employees tend to pull together and work harder for the company’s good.
• Increased Revenues – Everyone focuses on revenue and profits rather than individual compensation.
• Team Spirit – A commission structure encourages team participation and transparency.

 

Strong Sales Force Leads to Success

 

Forbes Magazine recently pointed out that attracting a strong sales team means the difference between companies growing slowly with companies that “skyrockets to success”. After all, a company depends upon its sales staff to succeed.

Attracting the “cream of the crop” depends upon a company that appropriately compensates them for their skill and talent.

Want the cream of the crop? Simply, pay traditional volatile salespersons the highest commissions possible.

 

Advantages of 100% Commission Companies

 

A 100% commission structure attracts the best salespersons. That’s because not only are 100% commissioned salespersons the best; they know they are the best. 

Therefore, 100% commission provides real estate growth.

 

Feeling of Ownership for Success & Real Estate Growth

 

Forbes also recommends cultivating a feeling of ownership amongst the sales force. Many business owners agree that employees who become the most personally invested in a company are the ones who have a larger stake in its revenues.

Greater success achieved by creating and implementing the highest commission structure. Not only does the company save taxes by not paying wages, but the feeling of strong ownership in the company by its sales staff creates a positive culture.

Entrepreneur Magazine in a recent article recommends hiring a 100% commission sales force to attract “aggressive, independent hunters”. In addition, 100% commissions encourage ownership of salesperson’s accounts. Another advantage of the 100% commission structure is the high rewards based on results. This inspires individual achievement.

 

Predominant Sales Style

 

Another Entrepreneur article compares different sales styles where all of them adapt well with the 100% commission model:

Finder – A salesperson who lives for the “thrill of the hunt”. Such salespersons demonstrate aggressive and competitive traits. However, they tend to be impatient with paperwork. Once a sale clinches, he or she is off to the next conquest. A true “Finder” is a rainmaker.   

Minder – This salesperson is a people person and a relationship builder. They take pride in providing excellent customer services. Very persistent. Believes in the old saying “a bird in the hand is worth two in the bush”. A true “Minder”.

Grinder – This salesperson possesses lots of energy. Very relentless. Not flashy like a Finder or warm and fuzzy like a Minder. The job gets done through pure persistence. Never affected by rejection. Never bored with repetition. A true Grinder.

Not every salesperson fits in these three types, as many can be a hybrid of two types.

 

The Best Fit for 100% Commission Salespersons

 

Determining one’s predominant sales style impacts the type of 100% commission brokerage offering the best fit for you and your potential business real estate growth. For instance:

A Finder needs an assistant or small staff to acquire and follow up with leads and prospects. Acquiring new clients instead of maintaining current clients is of greater importance for a Finder. Hiring a part-time assistant to handle phone calls, emails, setting appointments, and do all of the paperwork; frees up the Finder to do what she or he does best. A Finder may like a 100% commission brokerage offering support staff.  

The Minder spends a lot of time providing services. The best fit for a Minder with a 100% commission brokerage is one providing lots of client services. Such as in-house TC to handle all of the paperwork, in-house lawyer to answer legal questions, accessible broker to answer industry-related questions and help with client emergencies. A fully functioning office with all of the perks like various size conference rooms, office equipment, plenty of parking spaces, and convenient location.

A Grinder excels in high-volume sales environments. He or she feeds on walk-ins and knows how to play the percentages. Brokerages located in shopping malls or high traffic locales make a good fit for the Grinder. But, the bottom line is access to high volume prospects through brokerage outreach and marketing programs. 

Socrates once wrote, “Know thyself”. This applies to individual salesperson figuring out his or her sales style. In addition, it also applies to brokers knowing which sales style or combination of salesperson styles fits best with the brokerage structure.

 

100% Commission Plans Increase Real Estate Growth – Conclusion

 

100% commission structure helps real estate growth. As demonstrated above, the advantages of commission-based companies include:

• Motivation
• Stability
• Hard Workers
• Greater Revenues; and
• Team Spirit

A strong sales force leads to a company’s success and real estate growth.

Advantages of a 100% commission companies provide:

• Feeling of Ownership creates a positive stake in the company’s success.
• Individual Achievement based on high rewards.

The most predominate sales types include:

• Finders
• Minders; and
• Grinders

100% commission companies succeed by encouraging salespersons to produce.

Steven Rich, MBA – Guest Blogger

 

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We hope you liked our blog on “100% Commission Plans Increase Real Estate Growth”. For more local real estate related articles check out one of our many blog pages here.

 

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