This is the third episode in our new video series covering office management principles. The second episode analyzes a broker’s responsibility for continuous supervision.
This episode covers the development of a business model to outline the means and manner by which agents produce and service listings, and how purchase agreements are negotiated and closed.
Development of a business model
One method a broker uses to implement the requirement for supervision of employed agents is to develop a business model. So intended, the broker outlines the means and manner by which agents produce and service listings, and how purchase agreements are negotiated and closed.
The creation of a plan for office operations logically starts by establishing categories for itemizing administrative and licensed activities, then a written presentation of the conduct required of agents to achieve the broker’s objectives for each item.
Categories of business and licensed activities include:
- administrative rules, covering a description of the general business operations of the brokerage office, such as office routines, phone management, sign usage, budgetary allocations for agent-support activities (advertising, FARMing, etc.), agent interviews, goal setting and daily work schedules;
- procedural rules, encompassing the means and methods to be used by agents to obtain measurable results (listings, sales, leases, mortgages, etc.);
- practical rules, focusing on the documentation needed when producing listings, negotiating sales, leases or mortgages and fulfilling the duties owed by the broker to clientele and others;
- compliance checks, consisting of periodic (weekly) and event-driven reports (a listing or sale) to be prepared by the agent, and the review of files and performance schedules by the broker, office manager or assistants, such as listing or transaction coordinators; and
- supervisory oversight, an ongoing and continuous process of training agents and managing their activities which fall within the course and scope of their employment.
The rules and procedures established by the broker to meet their responsibility to manage and oversee the conduct of their agents when acting on behalf of the broker needs to be agreed to in writing between the broker and the employed agents.
A written employment agreement details the duties of the sales agent and the agent’s need to comply with an office manual which contains the broker’s policies, rules, procedures and other conduct the broker deems necessary to fulfill their responsibility for supervision. [See RPI Forms 505 and 506]
