August 19 2010
We had the pleasure of Brian White hosting an international study tour in Auckland last Monday. The study tour looked at five of our Auckland businesses over two days. The study tour concept within the Ray White Group has gathered momentum for existing business owners to look at each others’ businesses in different areas and different countries. These study tours happen every quarter and some of our Auckland business owners went to Melbourne on the Tuesday to look at their business models.
Bruce Whillans has recently joined our company, opening Ray White Commercial in Central Auckland. Brian and I took the time to meet with Bruce and Brendan, who are off to a successful start with a large appointment by a receiver of a substantive site north of Auckland.
Our company offers broad opportunities for salespeople, business owners and also within our management structures. Hayden Broadbelt, who joined our corporate office from Canterbury, is going to be opening a new office in an area known as Stonefields. The premises are currently under construction and it will be pleasing to see Hayden moving to the next level of his real estate career.
The real estate industry has produced many identities and last year Stephanie Kelland joined our Remuera team. Stephanie has made an immediate impact on our business with a number of high profile sales and reaching Premier status after only five months. I met with Stephanie to review her current activity and the progress she is making in the market.
The week also saw me in Queenstown for our International Commercial Conference hosted by Mark Williams. The broadness of our group always continues to surprise. One of the standout presentations was from Tony Bargwanna, who is the managing direct of Ray White Hotels. Tony has over 40 hotel listings and is the number one salesperson for hotels in Australia. His portfolio of property is breaking further new ground for the Ray White Group. Our New Zealand commercial businesses featured in the awards with our commercial teams in Christchurch and Wellington being recognised in the top 25 performers.
While in Queenstown we took time to visit the new Frankton office which is located in the gateway to Queenstown. Kath Cruickshank, who is a local identity, was undertaking a sale at the time and that is always an exciting thing to see. We visited Richard Newman’s office in Arrowtown and also our market leading business in Queenstown.
On my return to Auckland I was greeted with the news that Matt Shirley has started with us at City Apartments. This is big news for our group as Matt is one of the highest grossing salespeople selling apartments. He came to us from City Sales.
I met with Alistair Helm, the CEO of realestate.co.nz. There are plenty of exciting opportunities for this website and Alistair is always top shelf on enthusiasm and his thirst to take the website to the next level is always evident.
Ann Emerson is one of our top salespeople in the country and from time-to-time I meet with her to review her business activity. This week we made phone calls together to those in the market. It never fails to give clarity to what we are doing when we are actually looking at our skill-set in real time; we continually learn of not only the opportunity within the real estate industry but also the potential wastage. The exercise that we undertook polarises the top agents in the industry as the best.
Yesterday our national zone chair people came together in Auckland to review our policies and procedures that have been completely re-written. A company that is growing is one that needs structure, policy and procedure but must defend against rules. Growth does require freedom. We are determined as a group to have leadership of the industry and our policies reflect a business that has a thirst to gain market share collectively. We are now at 135 offices and we have a couple more starting next month. Given the market conditions, the strength of our business will come through our collective knowledge that everyone that represents Ray White is Ray White. Our company has had one language and one system for the last seven years. Making sure growth is the first policy and everything else sits underneath that will ensure our destination is leadership.
On the media front, REINZ released the sales numbers for the month – 4,565 – the lowest July sales result in 10 years. I would still throw a question mark over the validity of the figures. There should be some acknowledgement of variation that is made much more evident than the small disclaimer that sits at the bottom of their press release. That in itself makes for interesting reading but is never reported.
On the back end of strong market share in June, we are expecting further growth in July and look forward to reporting our market share results next week.
29 July 2010
From time-to-time you get wonderful opportunities in the role I undertake and one of those was to attend the Connect Conference in San Francisco. This is a real estate technology conference attended by just over 2,000 brokers from around the world. I was invited through Brian White and Ian Campbell. This conference, unlike many other conferences, was new learning right from the time it started; so much so, that even getting clarification on some of the language and acronyms used became a talking point. We attended the conference to get a better understanding of the greater delivery and distribution of real estate marketing for salespeople, offices and our company.
There is a continued division of opinion between many of the current distribution applications that are used within the industry. Video and photos are finding a collision point and there is some train of thought that buyers are not responsive to videos given they have access to photos. However as a clear point as to where the middle ground exists; there was one presentation about photosynth that clearly showed what the whole conference was about, right up to the biggest picture of how Google is playing a role in the real estate space. There were so many different viewpoints it depended on where that particular commentator and opinion was being viewed from.
It sounds simple, but centric to the whole industry still remains people. Individuals have to list and sell property. It is the application of technology as to how that is then distributed, who we partner with, when enough is enough and how distribution is being man-handled from within the industry by others. It raised a lot of questions.
As a company we have in the past demonstrated a degree in confidence in being a first mover with technology. There is no danger providing we control our content through one pipeline. An answer that did come through from a company’s perspective is that if you are tight on your decisions and relationships then generally you will have a successful outcome. It is when companies feed off our business individually that the danger for us becomes evident.
This week at the Aspiring Elite Conference on the Gold Coast, Brian White and Ian Campbell presented a session on what we took away from the Connect Conference. We will add to this for the Flywheels Conference, where we will be releasing our new potential partners in the online space and how we see the future in maximising each distribution point within the company.
It was a quick 3 day visit to San Francisco. I did some personal writings about some of my time over there and I welcome you to read these.
We are re-designing part of the layout of our Auckland corporate office to welcome a bigger team for the Loan Market on the back of their introduction into the insurance market. I have been impressed with the service that has been provided by the company Catalyst. Once the renovation is complete we should be able to house three businesses within our Auckland corporate office.
Growth and market share for our business is critical. I am pleased that we have achieved continued growth in our market share, the highlight being a record in Auckland at 21.7%. Our national results are now touching on 15%. We are going to have to really push hard to get up to the 20% mark. The results for June were sobering, but the market is the market and from that will come more opportunity. If we are moving towards another sales year of 55,000, which is similar to 2008, then pressure will come on the industry. We picked up more market share in the last two quarters of 2008 than any other time in our history of trading in New Zealand. The time we are in now is an opportune time for everyone to start talking about ‘where to in the future’.
The week saw several new members join us. Pearse Kinchella, the number one salesperson from Harcourts, along with Vivek Bangia also from Harcourts joined our Wanganui office. These are significant salespeople and we welcome them to our team. Matthew Smith on Waiheke Island has a highly successful brand and presence. Matthew is joining Ray White as of next week and that will lift our presence on Waiheke Island.
I am looking forward to our Herald on Sunday liftout – 40 pages another good team effort when listings are tight.
This week we are in preparation for our series of sales symposiums throughout New Zealand. These will work in tandem with our national marketing campaign throughout September. I believe what our business does today will more so than ever position it for the results we achieve tomorrow.
July 8 2010
When new salespeople join our company there is always a level of creativity, which is partly due to the fact that they are coming in to a new environment and there is a lot of material available that previously may not have been at their disposal. Salespeople are in this business on their own time and the majority believe that they are a business within a business. How do we promote this within our group?
I often talk about leaders and how they can provide the best value to their people. One way is ensuring that our own personal attitudes are not suppressed by past experiences. Allowing salespeople to be exposed to our business is one of the fundamental values in being a sales member at Ray White. As leaders, promoting a positive environment is part of what we do. If all our businesses are growing then we have a business in unrestricted growth. Everyone has their own business within a business and is a collective of salespeople. The other thing in common is that we have the same amount of time and this must be used most effectively to drive listings and sales.
I make this comment because I sat with two successful salespeople during the week who were told by their business owner that “it doesn’t work”; I heard from a vendor this week who said that “they didn’t get the opportunity to advertise in that”; and I heard from a prospective buyer who said that “they didn’t get shown that”. The biggest hindrance to growth is assuming and making decisions for other people.
I spent time this week with Megan Jaffe’s team at Remuera going through individual business plans and working specifically on skills and follow up. From there I joined with Keith Ashkettle to meet the people who are re-designing our website platform. There are some big opportunities in the redevelopment of our site, but there are also increasing dangers. Realestate.co.nz recently took two steps forward only to have to take three steps back. The message on our redevelopment is that it needs to be designed at a user level, not a provider level. I joined with Glen Young and Philip Hall at Ellerslie. They have expanded their floor plate to take in a further 50 square meters, as Harcourts recently closed their office right alongside them. This is a confident young business that continues to shine with their recruitment and which has seen them dramatically lift market share in their core trade area.
Over 10 years ago Ken Bogue and Alan Roberts joined their business to Ray White in one of the most significant opportunities for our Group in the Rodney area. What came from that was an opportunity in Orewa when the Century 21 office, which was then owned by Michael Pepper, merged with the Bogue business. I was fortunate enough to be asked to join them in celebrating the refurbishment of their office and which is a credit to all the team.
On a seasonal basis we have always collectively put together online and off-line statements. We have our next Herald on Sunday lift-out coming up on 1st August. Post this; the Group gets set for our National Statement campaign which commences in late August. We have started bringing together this campaign and have agreed rates with APN.
Our growth and performance team came together on Thursday. Top of the agenda was market share and other relevant areas discussed included recruitment, training, travel and our own teams. It is pleasing that we have appointed a new BDE in our sales development area along with a new property management BDE who commences next week.
I did a short trip to Sydney as Brian White was hosting several of our international group members and also two potential franchise owners from Tokyo who were over to look at our group. I had an opportunity to go to our new Sydney premises based in King Street. The question was raised “where is head office in Australia?” It’s going to be hard to go past the new Sydney base as it is a spectacular location right in the heart of the financial district.
I woke up on Saturday to see the story regarding to Bruce Whillans. Peter Best wrapped it up nicely in his comments about Bruce “Ray White is broadening its audience.” Confidence coming from within the industry is the first point to a real estate business in momentum. Attracting the best people is what we need to do. All members can take great pride in the underlying culture that has developed in our group to be able to welcome individuals such as Bruce Whillans.
28 June 2010
The real estate industry has a great mix of competitors. At a local level there are independent offices, franchised offices, company owned offices and sometimes publicly listed businesses. What does this all add up to and how do we make decisions when we have knowledge of our financial position? So many decisions are based on the financial KPI.
Two weeks ago Bayleys made an announcement that they have taken in a business partner who has bought a third of their business and paid several million that will then be injected into an aggressive growth strategy. Does this give them an advantage that we otherwise don’t have? I am like all of our business owners; every decision from cleaning the windows to leasing a photocopier to putting on a new staff member is directly correlated between the value and the cost. If you have a lot of money does that mean that your decisions are going to be different? Were a lot of us guilty when the boom was on of just ticking boxes and moving forward quickly? Was time more valuable than money? I thought to myself when I read the article “what could we do with $30 million and would it buy us market leadership?” The headline said ‘Capital injection set to launch Bayleys on an expansion path’. There’s one other competitor with a potential war chest and is publicly listed and that’s Wrightson’s. What have they done in our sector? LJ Hooker until earlier this year was owned by Suncorp Bank. How did that help them grow market share? Money will buy you a certain amount of position but the truth be known, like any real estate agency, you cannot buy profile and positioning without significant risk. Ask any owner who has funded an auction campaign. When you have a third party involved in your decision making, that third party wants a return. Is an investor prepared to wait 10 or 20 years to get a genuine return on their investment? There’s not many of them.
I heard an interesting observation about growth into China and the comment was ‘the way to make a small fortune in China was to start with a big one’. Market share, individual wealth, creating value and having a business in genuine momentum is a direct reflection of the leader. No amount of money will ever replace a genuine leader. I agree that there is a market cap but the best leaders are the ones who make the best businesses. Investing in your own leadership, taking control of your leadership aspirations and leading your business will bring the greatest dividend to individual business leaders within our industry. No company and no amount of money will ever replace genuine leadership in the real estate model.
Part of my week last week was spent in Northland meeting our business owners and sales team. Our market share continues to be impressive, particularly in the far north with Kaitaia currently holding a 45% market share within their area. The Mangonui office carries approximately 300 listings. They are investing in their e-technology and while I was at the office some clients from Hong Kong came in and remarked on the e-newsletter that they receive on a regular basis and that it was a key part of their decision to contact Ray White. Ian Knox at our Kerikeri office has also increased his market share in 2010. Ian has had some good appointments and his business continues to go from strength to strength. In Paihia, Ross Robertson has recently been joined by Julie Holford as LJ Hookers has closed in this area. Although there have been some price adjustments, they remain confident in their market position. The Mangawhai office on the coast is one of our top businesses in Northland. Sarah Paget and the team have had some excellent months. In Ruakaka, Brent Casey is one of two offices servicing this region. As his market share continues to grow he expects to be able to increase his staff during the next six month period.
We have 12 offices from Warkworth north. All these businesses serve the community and in many instances, deal with vendors who are absentee. E-marketing and our website presence on Trade Me and raywhite.co.nz continue to bring the majority of enquiry to these offices.
On Friday I took the time to meet with two people who are looking to join our company. I spent time in Kumeu reviewing our progress in this growth area.
Next week we have our 134th office opening in Frankton, which is the gateway to Queenstown. In addition to this, we have an exciting announcement regarding our Auckland CBD Commercial which is ready to take shape from Monday week.
4 June 2010
I returned back to Auckland from our trip through Asia which we met with our new franchise owners in central Hong Kong and also looked at a potential partner in Toyko, Japan. Our Hong Kong business is expected to open in the next three months as they are currently securing premises in the mid levels. This is a dynamic market and has a high patronage and sits within the ex pat community.
Andy Innes who took over our Whitianga franchise is gaining momentum in the marketplace. The office had a good display in the Herald on Sunday liftout. One of Andy’s personal passions is working in projects and he has developed a system to assist developers in ensuring that product can be taken right through every step of the process. We are looking at a proposal from Andy in regards to the broader reaching opportunities with project marketing in New Zealand.
As part of the new Act which came into force last November we provided the Group with a full range of compliance agreements. During May we undertook to upgrade these agreements to version 2 and these are now available on Channel5.
With all the activity overseas for Ray White we met in Sydney with our Indian franchise holder who now has eight applications for new offices which are joining those offices which have already started in the region. They are expecting to maintain a high level of growth as each market they go into they receive a positive response. During my trip to Sydney we reviewed the 2010/2011 budgets for our New Zealand business. When we do this we look at a number of factors including market conditions, marketshare and potential growth of the company. Our strongest marketshare still remains in Auckland and Canterbury as a Group with many of our regional marketshares continuing to improve. We expect to continue to apply resources into growth to move our presence beyond 150 offices.
Our West Auckland business owners came together for their zone meeting. We have available for every business owner in Ray White their personal analytics which shows productivity, marketshare by area, productive people and sales commission analysis. Many of our owners continue to strive for growth in marketshare and understanding the key indicators assists in this endeavour. West Auckland is our strongest marketshare through the Auckland region with the year ending marketshare being 23.8%.
One of the great pleasures in my role is to recognise performance within our company. Last week we announced our first three Premier members for the calendar year, they are Liz Parker, Rohan Thompson and Steen Neilsen. This is an outstanding achievement as these individual salespeople are on target to turnover personally $1m in sales commission.
The Herald on Sunday liftout saw 48 pages brought together by our members. It answers a number of marketing questions to get volume into the marketplace is an important feature of the liftout, the actual enquiry rate differs in areas but the response online remains an important barometer to the overall success of the liftout. The tentative date for our next liftout is August 1st.
Our Central North and Lower North business owners joined together in Taupo. They had a full day looking at their individual areas, market conditions and also growth strategies. An area top on their list was the success of the Ray White One system and the use of My Desktop to communicate to the marketplace on a new prospecting strategy. We have 38 offices through this region. It was also good to see our new business owners from Wanganui attend and give us positive feedback on the day.
Our May results came through and they were lighter than expected. The numbers held in Auckland but most of the other areas showed a decline and this could reflect the conservative nature of the market and the distance between buyers and sellers. We continue to layer on more stock with an increase of 18% which was ahead of industry averages. The full report is on our main homepage.
I am in Queenstown enjoying a break for a few days over the Queens birthday long weekend.
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