Local Real Estate Agents: Teammate or Competitor?

'If any of my competitors were drowning, I'd stick a hose in their mouth and turn on the water.'
– Ray Kroc, Founder of McDonald's

Real estate is, in many ways, a unique business. In what other profession is cooperation between direct competitors so necessary to achieve the end goal (transferring property between two parties)?

In sports, the line between teammate and competitor is crystal clear. In retail sales, the line is clear. In real estate sales, not so much.

Almost every real estate transaction involves two real estate agents: one representing the buyer, and another representing the seller. The buyer's agent is working to secure the property for their client at the lowest possible price while the seller's agent is working toward the opposite goal — getting as much money as possible for their client.

These two tasks seem diametrically opposed to each other. How can two agents with different goals work together to achieve what is best for both their clients? Should you work together, or should you stick a hose in your competitor's mouth and turn on the water?

Why competition is good

Our natural tendency is to think that competition within our chosen profession is bad. After all, if there were no competitors for your business, you would dominate simply by being present. No competition equals more business, right?

Maybe initially, but there are some good things that come from competing to win business:

• Innovation. If you're the only player in your field, it can be difficult to improve. There is no need to innovate. If you're working in a crowded real estate market, you won’t succeed by doing what everyone else does. Competition produces innovation.
• Avoiding complacency. If your business is consistently trying to innovate and better itself, you and your associates will push yourself to be better. You cannot be complacent if the competition has you in their sights.
• A focus on your core audience. If you are targeting a specific geographical location or demographic, market challengers encourage you to better understand that setting. In doing so, you can better provide for that group.

A little competition is not just healthy, it's a good thing for your business and your clients. So bring on the competition. Crush the competition. Stick a hose in the mouth of the competition and turn it on.

But wait...

Why teamwork is necessary

Competition can help businesses innovate, grow and prosper. But there comes a time to set aside the competitive drive and cooperate with your competitor, working with them to achieve a common goal — helping clients buy or sell a home.

To achieve that goal, follow these best practices:

• Cooperate whenever possible. You don't have to join hands and sing "Kumbaya" around a campfire. You don't need to become best friends with the agent on the other side of the transaction or send them presents. But you will need to work together for everyone involved to be successful.
• Communicate and coordinate steps in the transaction process. Synchronize times for appraisers and inspectors to access the property. Work together to ensure that paperwork is completed in proper and timely fashion. Help each other understand the terms and conditions each party in the transaction requires. After closing, team up to ensure that all required paperwork is submitted and the transaction is finalized internally.
• Encourage interoffice competition. Go ahead, track those interoffice listings and sales. Offer prizes for the winners of business challenges. Pit your agents against each other in friendly competitive challenges. You don't have to focus solely on sales. You can incentivize other things like number of appointments set, database growth, expansion of SOI, or even something as simple as submitting paperwork on time. Challenges lead to healthy competition, the kind of competition that motivates people to to innovate, experiment, and challenge themselves to do better.
• Send a post-closing survey. Brokers, want to encourage your agents to cooperate with other agents? Want to motivate yourself to cooperate and be a better teammate? Send the agent on the other side of the transaction a customer satisfaction survey. Ask them how you did. Ask them if you were accessible, helpful, responsive and cooperative. Reward your agents (or yourself) for positive feedback and challenge yourself to improve in areas where you are weaker.

You can be both competitive and cooperative with other agents. Whether the agents are within your brokerage or outside of it, all agents are a source of inspiration and can present you with learning opportunities. A mix of friendly competition and targeted teamwork can go a long way toward improving your business.