The self-employed agency model will not be successful in the UK because the commission in this country is so low.
That’s the view of Simon Shinerock, chairman of the Choices agency group.
In an interview with Assist Inventories he says he understands how the concept of working from home and running your own business may appeal to some agents, but he insists the High Street and the traditional agency structure remains the most successful long term strategy.
“I can see how the likes of eXp [a US agency run in the UK by former online agency chief Adam Day] and Keller Williams [another US firm operated here by former Countrywide director Ben Williams] – and the host of copycats that have risen up alongside them - have created a sort of crèche for new businesses” says Shinerock.
“As I have said before; there are massive differences between the UK, North American and European markets. Notably the commission levels in the UK are too low for this model to really succeed” he continues.
“Instead, these companies are providing an unintended stepping-stone to the high street for the small number of exceptional agents that join them.
“In the longer run; the industry will continue to change – and it may look very different in a few years time. But while the fundamentals remain as they are; I don’t think these companies will achieve much success.”
The self employed model appears to have gained traction in recent months; in addition to the US-inspired agencies, Hunters and Spicerhaart have recently promoted this way of working, with agents using an established brand name but working their own hours, from home or a services office.
Several London-focussed agencies have also sprung up in recent years, including Agent & Homes and Harding Green.
The rest of Shinerock’s interview covers his personal approach to agency activity, and his take on the relationship between the human psyche and the housing market.
You can see the full interview here.
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....£129k sales profit in the first 6 months of this year, working from home, self employed....yeah you're right it won't be successful.
Well done, now say how many fellow self employed agents there are in your franchise and where you rank, pretty near the top right? I’m sure you can do the maths yourself and work out how much is in it for the franchisor
I am the franchisor aswell....
If you are good enough you can work from home, earn £100,000+ and be your own boss, if you aren’t then it won’t work. The idea won’t fail, the person will thou if not good enough.
With this kind of Franchise the person is the idea. The problem you face in my opinion is in attracting and retaining enough of the right kind to make a profit. Hey, I admire you for having a go but my experience of recruiting and testing life assurance sales people, a model on which all these franchisees are based, together with 32 years in agency informs me it won’t be viable in the UK. I’m prepared to be proved wrong
"Warns leading agent" - never heard of him.
Sounds a little bitter do you think? Going self employed was the best move I've ever made. I think this chap is worried to lose his best Agents who are worth paying more.
And there was me thinking I was famous darn it. Actually ‘Leading’ doesn’t necessarily mean ‘well known’ 😉
It will enable the better agents to capture a greater share of revenue and increase their earnings which is exactly what the industry and people working in it need. The industry will become a partnership of platforms and people with the platforms enabling productivity gains through technology and marketing techniques. The most interesting questions imho are by how much and how quickly can technology and marketing savvy amplify the abilities of estate agents and how applied and how good can those agents be ?
Clients dont like walking into high street offices anymore and dealing with a multitude of people, the personal one to one service is the way forward. My clients love it... Is Simons son a KW agent ?
He is
I think I should point out that of course there will be successful self employed agents working from home making money, just not enough of them for those franchise businesses to make a decent profit in most if not all cases. As for the High St, a shop is a very cost effective local advert, especially with the demise of the local papers. In any event I guess time will tell
Seems to be a lot of people wilfully misunderstanding Simon here, and taking it personally. Maybe its the article itself, but I read it that he thinks the concept itself won't overtake the traditional High Street set up, and I couldn't agree more. That's not to say that individual self employed agents cant make a go of it. I have a self employed agent under my banner, but I dont ever see it replacing my main business
Spot on Stephen
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