Monday, October 30, 2006

The Carnival of Choosing Your Niche

I was reading one of the Carnival of Real Estate’s posts from Bloodhound Realty last week on the topic of changing your business model to maximize your return. The post was specifically on adopting a flat fee model versus a full commission business model to adapt to the current real estate environment. Now there is nothing special about the flat fee model, but what I did want to point out is that the approach that our Bloodhound has taken is to identify where the biggest revenue potential exists in his organization. He has then adjusted his business model to leverage these opportunities.

The posting make the point much more eloquently that I have. However, the lesson is simply that real estate agents need to take a good look at their current service offerings as well as their market and determine exactly where the greatest opportunities lay. For Bloodhound Realty, their approach for differentiation is to move to a flat-fee service and really market the savings that potential buyers and sellers will enjoy. For other agents, they may choose to focus on specific niche’s; agents in my area are specializing in buy and hold investors as well as first-time home buyers. Regardless of your approach (flat fee, low priced niche, luxury niche, investor niche, rental niche, leasing niche, etc.) now is the time to really look at how revenue is brought into your organization and what is needed to keep the cash flowing in.

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