Operational Blueprint:
Best Practices for Team Structure & Business Operations
- Overview
- Benefits of Highly Specialized Teams
- Identifying Opportunities for Growth
- Knowing when to scale
- Headcount Modeling and Forecasting
- Knowing when to scale
- Team Functions, Roles & Responsibilities
- Foundational Roles: Responsibilities & Compensation
- Buyers Agent
- Transaction Coordinator
- Inside Sales Associate
- Sales Manager
- Additional Roles to Consider: Responsibilities & Compensation
- Operations Leader
- Sales Leader
- Marketing Coordinator/Manager
- Recruiter
- Training and Development Manager
- Administrative Assistant
- Team and Agent Splits
- Incentive Programs
- Conclusion
Overview
Why we built this Operational Blueprint
As real estate teams consider scaling their business, it’s important that they review how their operations and finances are run. While teams find initial success by converting the connections they receive, in order to grow and scale their operation, teams should consider how they’re investing in their business to fuel sustainable growth and future success.
In developing this Operational Blueprint, we’ve collaborated with top Zillow Premier Agent partners and their teams across the country. We’ve conducted in-depth interviews with these partners, learned from their business strategies and operations, and dove deep into their strategies for scalable growth. The information in this operational blueprint is built upon a strong foundation from our partners and research done by our partner strategy team. Our findings have been consolidated into this blueprint, and we’re excited to share it with you.
Our research concludes that teams who adopt a highly specialized model, with dedicated roles and responsibilities, have the building blocks in place to help scale connection volume and support a larger number of agents. This team structure removes administrative or non-revenue generating tasks from agents allowing them to maximize their time and capacity to focus on client facing work that can result in additional deals closed. While there is an upfront cost of hiring additional roles, the additional clients supported by agents typically translates into more closings which helps with additional costs long term. Premier Agent Partners we interviewed cited that offering a highly specialized model helped reduce agent turnover and improves client satisfaction.
Once Zillow connections have become a large portion of your agents business, we recommend that teams work towards having dedicated sales and operations functions to optimize workflows and conversion.
Benefits of Highly Specialized Teams
Build a team of experts
Empower agents to remain focused on converting leads and connections into satisfied customers. Remove as many operational tasks as possible to allow agents to remain laser focused on client engagement, providing exceptional experiences, and delivering higher quality interactions with home buyers and seller agents.
Operate efficiently
Build a team with specific roles and responsibilities to better distribute tasks across your workforce. This type of team setup encourages the standardization of workflows, processes, and operating procedures. It also establishes clear expectations so all are aware of what they should accomplish. Operational efficiency, positions teams for increased productivity which helps enable greater profits.
Provide strong leadership
Demonstrate strong leadership by bringing clarity around team structure. As teams scale, effective leadership is necessary to guide teams toward success. It’s important for leadership to support their teams and ensure they remain aligned to business objectives. Leverage strategies like goal setting and performance measurement to drive success.
Identifying Opportunities For Growth
Increasing the number of roles on a team comes with additional expenses. Highly specialized teams typically take a higher agent split to afford the additional expenses incurred.
Knowing when to scale
Considerations for a highly specialized model
Our research indicates that adopting specialization models to handle Zillow connections positions teams for success under certain conditions:
- Team size must be large enough to warrant specialization
Teams with a variety of specialized roles are designed for high lead volume environments and for growing teams. In low lead volume situations, non-specialized team models can still accomplish and meet team, agent, and Client needs.
Teams that succeed with the highly specialized team model are typically those teams that have significant agent count and/or preparing for growth. - Require sufficient capital and higher risk tolerance
Increasing team size, adding additional staff, and increasing operating expenses has the potential to reduce team profit.
Without diligent planning or accurate financial projections, teams who attempt to transfer models may burn through investment capital quicker than expected, make less revenue per transaction, and/or scale too quickly.
Organic indicators of growth
How do you know how many buyers agents are needed? What are the signals that a team needs to scale? What are the indicators that it’s time to add an additional team?
Let’s say 100 connections are coming in for the team during the month. We have seen that a single agent should receive about 10 connections each month to ensure they have enough opportunities to gain appointments and close deals without getting overwhelmed. That means a team would need between 8 and 10 agents in this scenario.
To reach the goal of a 10% conversion rate (which is the conversion rate we encourage all Flex Select partners to aim for), 1 out of every 10 connections needs to be closed, therefore, an agent needs 10 “at bats” (i.e., connections), to close one deal and achieve our target 10% conversion.
Additionally, any agent receiving more than 15 connections in a month can cause issues with the agent’s ability to focus and nurture clients. If an agent is taking twenty plus connections to close one deal, that might be an indicator to take a closer look at that agent’s workload and see if changes to the team are necessary.
When to think about scaling
- Answer rate for connection calls is consistently high (4-6 months)
- CSAT is consistently high (4-6 months)
- Conversion rate is consistently high compared to market average (4-6 months)
- Connection volume outweighs buyer agent work load
- When agents receive more than 15 connections, we see a negative impact on conversion rates
- Team Leads cannot effectively manage the number of agents they supervise
- Recommended team size for a Team Lead to manage is 8-10 agents
Headcount Modeling and Forecasting
We have seen that partner agents perform best when they ramp up their capacity to be able to receive and maintain 10-15 Zillow Premier Agent connections each month. This number is based on research conducted across our Premier Agent partner population to identify the optimal volume of connections before agent performance starts to drop off. Too few leads, and an agent may not devote enough time to working those connections. Too many and an agent may feel overwhelmed and let some customers fall through the cracks. Take the total number of connections a partner receives each month and divide that number by the number of agents on their team, if the resulting number is greater than 15, it may be time to hire some new agents.
Talk to your Zillow Advisor if you are looking for guidance around headcount and capacity planning.
Team Functions, Roles & Responsibilities
Our research shows that successful teams often adopt highly specialized team structures. This structure includes dedicated roles, responsibilities, and defined operating procedures, ultimately moving away from roles with hybrid responsibilities to drive operational excellence.
Many teams that have scaled with Zillow Premier Agent and committed a significant portion of their business to working Zillow connections have made adjustments to better support this model. This highly specialized team structure often includes both sales and operations functions dedicated to optimizing Zillow connection workflows and conversion.
Foundational Roles: Responsibilities & Compensation
Buyers Agent
The role of a buyer’s agent is to guide home shoppers through the process of purchasing a home. Our highest performing teams using Premier Agent typically have dedicated buyers agents that solely focus on Zillow connections and clients.
Responsibilities
- Engage every connection and direct lead with a customer-first mindset
- Find and schedule appointments for homes that meet client home search criteria
- Educate clients on the home buying process by answering questions, providing accurate comparative market analysis (CMA), and sharing other market research
- Assist buyers with the prequalification process by connecting them to a lender
- Attend on-site property inspections and negotiate inspection repairs
- Write, negotiate and submit contracts on behalf of clients
- Keep team lead and/or sales manager updated on pipeline health, client communications and any other client developments
- Ensure documents, information and other related documents are appropriately shared with their operations team
Compensation
While most brokerages hire Real Estate Agents on a 100% commission based model, new compensation models are emerging which blend a steady paycheck with a similar earning potential as the standard commission model. Typically, experienced agents favor the commission based model for the higher earning potential while newer agents or those coming from another industry are more likely to favor a base salary with transaction bonuses. In other words, agents at different points in their career may favor different compensation models and offering a variety of programs to match your agent’s interests may set you apart and unlock more candidates who want to join your team.
- Commission Only: This is the typical pay structure for real estate agents.
- Salaried: Some Select Partners have experimented with salaried agents, usually providing a base salary with a per-transaction bonus of either a set dollar amount or a percentage of the transaction price, which is typically less than the standard commission rate. This model has been used to attract agents who are earlier in their career who are looking for stability and a place to learn. This model can incentivize agents to work with all leads, regardless of deal size. We have seen the salary model work in a variety of ways, and below are some of the more common variations.
- Fixed salary or hourly wage + reduced commission: In this model, an agent is paid a base salary or hourly rate for their work, along with a reduced commission for any transactions. This model requires the broker to pay an agent salary but can result in additional upside for the broker should that agent transact above a given volume. This model might also be used to help recruit new agents and help them get trained before they are transitioned to a typical commission split after a given time period.
- Commission based with draw down: This model is a variation of the standard split model where an agent is instead paid upfront a fixed salary which is deducted, or drawn down, from their future commission upon a completed transaction. This compensation model is a balanced approach representing a hybrid salary and commission model which may be favorable to both new and experienced agents alike.
- Fixed salary or hourly wage + reduced commission: In this model, an agent is paid a base salary or hourly rate for their work, along with a reduced commission for any transactions. This model requires the broker to pay an agent salary but can result in additional upside for the broker should that agent transact above a given volume. This model might also be used to help recruit new agents and help them get trained before they are transitioned to a typical commission split after a given time period.
Transaction Coordinator/Manager (Contract to closing)
Transaction coordinators primarily focus on tasks that take place between contract and closing, but some may also help with things like marketing listings and staging properties. Transaction coordinators ensure all compliance and contract dates are met so everything is delivered and closed on time.
Responsibilities
- Oversee all aspects of transactions from purchase agreement to closing
- Coordinate title and escrow, mortgage loan and appraisal processes
- Coordinate inspections and assist in negotiations regarding repairs and completion of those repairs
- Regularly update and maintain communication with clients, agents, title officer, lender, etc. once clients are under contract.
- Submit all necessary documentation to the office broker for file compliance
- Coordinate moving and possession schedules.
- Schedule, coordinate and attend the closing process
- Input all client information into client database system
Compensation
Salary with Optional Performance Incentive
- Zillow Premier Agent partners that we interviewed reported the typical pay for transaction coordinators is between $40k-$65k based on their experience and productivity. Teams may also pay transaction coordinators a $50-$100 bonus per closed transaction to incentivize productivity.
Inside Sales Associate
An inside sales associate’s (ISA) role and responsibilities can look very different from team to team. Based on our research, we recommend having ISAs only focus on nurturing leads. This includes connections handed off from buyers agents, email leads, nurture leads, and contacts that haven’t responded in two weeks. This model helps buyers agents focus on existing clients, providing value, and sharing their expertise, while foregoing initial client screenings which can take a substantial amount of time each day.
Having ISAs answer connection calls in addition to nurture leads can be risky because they may not be prepared to provide the same type of service or answer questions that would require a real estate license.
For Flex Partners Only: Zillow offers an In-House Nurture program that uses consumer website activity and shopping history on Zillow.com to send personalized messaging (email and text message) to consumers who are not quite ready to connect with a Premier Agent partner. This messaging includes topics like home search requirements, general research, and touring. We’ll nurture those Zillow users until they are ready to work with a Premier Agent partner. Live connections are delivered to you in addition to your monthly connection volume. This allows your ISAs to focus on nurturing clients who have already converted into clients or are in later stages of the homebuyer process.
Flex Partners participate in the program because of the operational efficiency and support that it provides to their ISA’s who can focus their efforts on other activities and lower funnel nurturing.
Responsibilities
- Respond to inbounds and vet contacts into “Active” or “Nurture” pipeline segments
- Coordinate purposeful nurture campaign initiatives
- Follow up with nurture leads to convert them into appointments with buyer agents
- Manage client databases and regularly update CRMs with relevant information
- Collaborate with internal operations teams to provide information, documents, or other materials to progress client transactions.
Compensation
- Option 1: Salary or Hourly Pay
- Zillow Premier Agent partners we interviewed reported that typical pay for entry to mid-level ISAs is $40k-$60k per year, and more experienced and productive ISAs are generally paid $60k-$80k per year.*
- Option 2: Base Hourly Rate & Performance Incentive
- Paying for contracts filed vs. transactions closed rewards the ISA for desired behaviors and for converting qualified leads instead of leads who may never transact.
- Zillow Premier Agent partners we interviewed reported that typical pay for this model is an hourly rate (e.g., $15/hour) with an incentive bonus (e.g., $250-$500 per contract filed).*
*Paying bonuses on contract filed vs. transactions closed opens up risk to the team should transactions fall through.
Sales Manager
Sales managers help manage a team of agents. This role will focus on setting performance goals, driving results, and measuring success across the team.
Responsibilities
- Oversee a team of buyer agents and ISAs within a specific region; responsible for meeting sales targets for the assigned region
- Set goals for team members and monitor performance against established KPIs
- Meet with team members 1:1 weekly to discuss progress against goals
- Provide feedback and coaching focused on conversion and client management
- Ensure ISAs and buyer agents are updating their CRMs, managing healthy pipelines, and driving contacts through the transaction funnel
- Effectively manage lead distribution and team member capacity; reduce leads for underperforming agents as necessary
- Coordinate with internal operations teams to provide information, documents, or other materials to progress client transactions
- Provide advice, strategies, or other resources to team members during negotiations to ensure clients receive best experience and financial outcome
- Represent high-profile clients as needed
Compensation
Salary with Performance Incentive
- Zillow Premier Agent partners we interviewed reported that typical pay for sales managers is between $75K-$100K. Teams may also pay incentive bonuses up to 5-15% of the salary dependent on meeting sales and revenue targets.*
*Some teams reported that they provide sales managers with lower base salaries but higher bonus potential and payouts if quota is achieved.
Additional Roles to Consider: Responsibilities & Compensation
While the following functions should be accounted for in any team, it may not be necessary to have dedicated roles in these areas. Depending on a team’s size, it may make the most sense to train employees to take on various responsibilities (ex: ISAs take on marketing tasks).
Simply ensuring these functions are incorporated into a team’s business operations is more important than having an assigned number of roles for each area. However, as teams grow, having dedicated roles and resources for these functions will likely result in greater efficiency and productivity.
Operations Leader
The operations leader is responsible for managing and scaling the supporting functions of a team, operational efficiency, and maintaining financial records. Depending on team scale and size, this can include back-office positions like ISA’s and transaction coordinators, or other support functions like marketing or training and development.
Responsibilities
- Oversee all operations of team business
- Ensure agent activities are limited to lead generation, listing and showing properties, and negotiating contracts
- Build and manage systems for the team, such as client database management, lead source tracking, lead follow-up processes, and office administration
- Maintain financial systems, profit and loss statements, bill payments, and budgets; provide expense forecasts
- Develop operational flows and processes between agents
- Create and update all job descriptions/employment contracts for any future hires
- Manage the purchasing of any office equipment and business related supplies
Compensation
Salary with Performance Incentive
- Zillow Premier Agent partners we interviewed reported that typical pay for a director of sales is a salary ranging from $100k-$150k based on experience. Teams may also pay incentive bonuses up to 5-15% of the salary dependent on meeting sales and revenue targets.
Sales Leader
The Sales Leaders are responsible for managing sales operations and activities for the entire team. They’re accountable for team performance to sales goals, managing and developing sales managers, and overseeing potential growth into new markets and team expansion. This role is worth exploring once a team has a handful of sales managers and would benefit from a single point of responsibility to oversee day-to-day sales activities.
Responsibilities
- Oversee performance in all sales regions to ensure team hits quota and sales targets
- Forecast revenue and adjust to reflect market conditions and team performance
- Collaborate with team leads to develop annual revenue goals
- Collaborate with sales managers to develop and region specific goals
- Assess team size and evaluate additional headcount to support team growth goals
- Identify opportunities for expansion; facilitate entry into new markets with sales teams and coordinate recruiting if needed
- Analyze sales manager performance and coach on best managerial practices
- Conduct monthly and quarterly business reviews
Compensation
Salary with Performance Incentive
- Zillow Premier Agent partners we interviewed reported that typical pay for a director of sales is a salary ranging from $100k-$150k based on experience. Teams may also pay incentive bonuses up to 5-15% of the salary dependent on meeting sales and revenue targets.
Marketing Coordinator/Manager
The role of a marketing coordinator is to build, execute, and maintain multiple marketing campaigns to help expand a team’s branding. They use various ad campaigns to market new listings from beginning to end. They conceptualize campaigns, develop and execute all ads, and analyze ad performance results. They need to be very familiar with key social media platforms and should ensure a consistent online presence.
Responsibilities
- Track inbound leads from websites, social media & other online sources
- Manage client database management program and system
- Design and execute nurture lead campaigns in conjunction ISA team
- Create and regularly prepare buyer consultation packages
- Manage and update agent website(s), blog(s) and online listings
- Source client testimonials for websites, social media & other marketing materials
- Coordinate appreciate events and gifts for clients and vendors
Recruiter
As teams grow, so does the need for hiring specialized roles to support strong business operations. Employing a dedicated Recruiter or Talent Acquisition Manager can be characteristic of a large team. A recruiter can assist in building and maintaining a pipeline of potential candidates which can jumpstart the hiring process when needed.
Responsibilities
- Work with team leadership to determine additional headcount needs
- Write and post job descriptions for open roles on job boards and other websites
- Develop a framework for reviewing resumes to identify qualified candidates that match the job profile and possess the necessary skills for the role
- Maintain a healthy candidate pipeline and act as the primary point of contact during the recruitment and interview process
- Set up interviews between candidates, team leads, and other team members
- Write and deliver offer or rejection letters based on selection process outcome
- Work closely with ops and sales teams to appropriately onboard new team members
- Coordinate appreciate events and gifts for clients and vendors
Training and Development Manager
A training and development manager plays a pivotal role in ensuring new team members onboard successfully and helping existing team members continue improving their skills.
Responsibilities
- Onboard new team members and uplevel skill sets of existing team members
- Curate and deliver curriculum on best practices for real estate sales
- Provide the team with industry trends related to real estate best practices
- Provide coaching and mentorship to sales agents alongside sales managers
- Train operational teams on procedures outlined by the Operations Leader
- Provide resources for continued education that are inline with real estate guidelines and regulations
Administrative Assistant
An administrative assistant is a jack of all trades. At a minimum, assistants help with maintaining schedules, preparing for meetings, answering phones, and filing. Depending on an assistant’s skill level and experience, they may also help with marketing efforts like events, office maintenance, and acting as a point of contact for staff and external stakeholders.
Responsibilities
- Manage the schedules of team leads and director level team members; schedule meeting on behalf of the team
- Assist operations teams with filing data, documents, and other relevant materials in accordance with regulatory requirements
- Answer office phone calls and general email inquiries; route inquiring parties to the appropriate team member
- Ensure office supplies are stocked and that team members have the appropriate equipment to work
- Ensures office processes are followed and internal systems are working properly
- Performs other duties as assigned
Compensation
Salary or Hourly
- Zillow Premier Agent partners we interviewed reported that typical salaries for administrative assistants range from $30k-$65k based on experience.
Team and Agent Splits
Structuring splits is highly situational, dependent on your team’s set-up, and includes local market considerations. Does your team provide operational support, office space, and marketing services to your agents? Or do you leave this up to the agents to own? Do you have to pay a brokerage fee? Answers to these simple questions will have a big impact on the way you approach splits with your teams and should be carefully considered.
In this section we aim to talk more broadly about two common structures that Premier Agent Teams use to help motivate and drive increased sales across their agents.
Common Real Estate Commission Structures
- Fixed splits – This is the most common model and easiest to understand and implement. Fixed splits divide the commission between the broker and agent in fixed amounts which can range from 100% of gross commission income (GCI) in favor of the agent to a larger percentage in favor of the broker. Generally, common splits are 50/50 and 30/70 between the broker/agent. The benefit of fixed splits is simplicity, it is easy to implement in operations and for agents to understand. The disadvantage is motivation, fixed splits provide less incentive for agents to increase production and higher volume agents may look for work elsewhere.
- Graduated or tiered splits – Graduated splits, also called tiered splits, change the split percentage based on volumes or targets set by the broker and agent for different levels of production. Each threshold can be set based on sales transaction volume, number of transactions, hitting specific conversion or customer satisfaction benchmarks, or a combination of these. Generally, as an agent increases their production, the commission splits increase in their favor. The benefits of tiered splits include motivating agents towards higher performance by better split percentages, it is better for retaining high performing agents compared to fixed splits, and it allows for lower costs of new and training agents by taking a higher percentage of their splits. The tiered splits model works well for new and experienced agents alike, but is more operationally complex and has a higher administrative load to account for the correct commissions as well as additional costs such as franchise and marketing fees.
Incentive Programs
Employee incentive programs not only reward good employee performance but give prospective employees something to look forward to if they come to work for your partner. Incentives can help motivate employees and give prospective job candidates something to look forward to if they are picked to fill the position. Here are two examples of incentives that we have seen used by Premier Agent partners:
Team-Wide Contests*
- For agents, Inside Sales Associates (ISAs), Office Managers, Transaction Coordinators, etc., incentives can be a great motivator and encourage friendly competition.
- For agents, we have seen partners conduct team contests around the number of homes sold, and for ISAs, we have seen partners conduct contests around how many leads cultivated by ISAs ended up in closed deals.
- Partners have conducted monthly, weekly, or quarterly contests. Partners have offered prizes from a fancy dinner, to money, to an electronic gadget – or even paid time off. Also, partners reiterate the importance of ensuring everyone on the team has a fair chance to win.
Personal Sales Performance Incentive Fund (SPIFs)
- Because motivation is so specific to the individual, personal SPIFs, in addition to team-wide contests, can be a great additional incentive. Personal SPIFs are great to help motivate team members that might still be hitting their metrics, but their morale is down.
- Partners who use SPIFs ask the individual what motivates them, to help the individual hone in on a goal and offer them the reward for hitting that goal. Partners who utilize SPIFs reported that if they give one salesperson a personal SPIF, they may have to do it for everyone. Partners noted that it is important to double-check there’s enough budget before agreeing to the use of any SPIF.
- Although these strategies have been proven to be successful, it’s worth experimenting to find the optimal sales incentives program for your specific team, objectives, and culture.
*Note: Contests, promotions, and sweepstakes can be regulated by federal, state, and local laws. Before you run a contest, promotion, or sweepstake, we recommend checking with a local attorney to ensure your actions comply with all applicable laws.
Conclusion
The foundation of this Operational Blueprint for Team Structure & Business Operations Best Practices is based on the insights and research we’ve gathered during interviews with existing Zillow Premier agents. While reviewing your team’s structure, business operations, and opportunities for growth can be an overwhelming process, we hope that this guide helps you think through different ways to scale that make the most sense for your business.
We recommend using this resource as a starting point for you to consider what to do next with your business. You can always reach out to your Zillow representative for help developing your personalized plan leveraging their guidance and knowledge of your team and market.
