Without question, the most common frustration I hear from business owners is about their agency’s lower than desired growth rates. If growth targets aren’t being achieved, there are typically one of two issues (or both) responsible for that: the first is a misunderstanding of the sources of growth and the second is that the business development function is not staffed by salespeople.
As described in our book, Numbers Game, we define five distinct channels of growth. Each of those requires a different marketing and sales approach. Regardless of the channel source, all new business is a sales function. Even a channel one lead requires a sales effort to win the business. It’s entirely reasonable to place a less experienced business development manager in charge of channel one leads because the sales process may be easier than in another channel, but it’s ultimately still a sales channel.
That isn’t to speak poorly of property managers or salespeople, it simply reflects the fact that the two roles require different skill sets
We often refer to the different approaches as hunting and farming. Unfortunately, too many agencies appoint a property manager to do a sales role. That isn’t to speak poorly of property managers or salespeople, it simply reflects the fact that the two roles require different skill sets and are almost always best performed by different people who are suited to their respective roles. History shows that using a property manager to grow a rent roll has a very high failure rate. When results are not forthcoming, the business owner can become disillusioned with the whole idea of the business development team – and miss out on the very real opportunity to grow the business.
In Building Blocks we argue that there are three core roles in the business development team: the business development manager, the business development officer and the leasing agent. The business development manager takes responsibility for the growth of the agency and the management of the business development team. The business development officer grows the rent roll by signing new, profitable managements. Often this will involve focusing on channels one and two. The leasing agent ensures properties are leased to good-quality tenants in the least possible amount of time and that those new tenants are inducted into the agency in a way that maximises the chances of the tenancy going well. The leasing agent uses this opportunity to develop their sales skills.
Once the business development team has been built, resourced, trained and let loose, the agency must go about building out its core property management team. An aggressively growing business will need to recruit and grow the capacity of the team on a consistent basis.
The most effective way to do that is to build a team structure that can support the agency to recruit relatively inexperienced property managers and lettings agents, supporting those people in their career development as the business grows. This is a superb way to manage the economics of a business and build a culture of professionalism and career development that will support the agency as it grows.