If you view my site you will notice I do not post a lot of Blogs. I try not to move the air in front of my lips too often. I’ve been coaching real estate brokers since Jan. 1978. During that time I have met many fine brokers and real estate speakers.  My findings and conclusion are that very few so called Coaches really have no real life experience in real estate.  Meaning they have never been truly successful selling real estate, or for that matter, building a successful office. That is not to say their service is not worth what they are being paid. It just means that they copied other coaches and said to themselves I can deliver that message in a better format. In the end they regurgitate back what someone else said and that is all they really know. True coaching is, in my humble opinion, the marriage of actual experience in knowing how to grow a successful real estate company and the combination of utilizing true creativity to differentiate your clients from the lame competitor down the street. Remember, you would not ask a doctor to operate on you if they never performed one before. Be careful out there.

Over time we tend to adjust our thinking and perspectives of how we want to conduct our business.I’m referring specifically to the real estate industry and directly to the real estate agents and broker/owners.

The industry is very attractive based upon the ability to operate as an independent contractor. No set hours and you are rewarded based upon your own ability to produce results in servicing either buyers or sellers of real estate.

In the last 40 years many Real Estate Franchise companies have been started and then promoted. From there the brand was used to attract new franchisees and agents to work within those franchises.

The end result is that the franchise industry has captured over 60% of the real estate market in the United States. The franchisors did very well and far better than the franchisee’s that believed in a specific brand.

Just because someone buys a franchise does not mean they will be successful. The franchisor, as they are known, does not warrant or guarantee success. That is entirely up to the franchisee.

Who buys a franchise and why do they buy a franchise?

Most are purchased by either an independent real estate brokerage company, or an agent within that company who feels they want to grow a successful business using the business model of a specific franchise.  Some franchise companies are easy to deal with others having no clue as to how to listen to their customers. Those that cannot hear soon find that the franchise has switched either to another brand or decided to private brand itself.

The reality is that many people who purchase a franchise really should not have done so.

The reason is they possibly were not qualified to manage a business or did not have the personality to lead. Leadership is paramount.

Many franchise sales people never sold real estate.  The next time a salesman attempts to sell one of these great brands ask the salesman, if it is that great why don’t you own one?

Over the last 30 plus years I have seen many so called franchisee’s fail. I have seen great sales people over extend themselves to build a successful real estate office and let their ego over rule the primary objective for being in the business.

The objective should be to earn a great living and have total control over your own destiny. What they really should have done was to say, OK I am going to be very successful in the business and will align myself with a quality company in my market.

I will go to work and build my personal book of business. The better I serve my customers the more referrals I will receive and the more money I will earn without having to make any major investment in office buildings, support staff, insurances, and reporting to a franchisor.

At this juncture I feel STRONGLY that there is no need for any more real estate franchise companies. An agent can name his/her own ticket and have a super career with no headaches of running a company. Many existing brokers wish they had done just what I suggested years ago.  They know it was not worth the pain of being a baby sitter to everyone in the company.

All an agent has in life is 24 hours a day to make a living, raise a family, take a vacation now and then, and build a retirement account by purchasing an investment house every year. That is exactly what I taught my agents when I founded RE/MAX in PA in 1978.

At this point many of those agents became millionaires following that suggestion.

In closing, if a young real estate agent wants to truly be successful I recommend stay an agent or associate broker with a quality firm. Don’t make the mistake that so many others have made of buying some franchise and then wasting your time, money, and maybe even your family by working too much and taking too many risks trying to help other agents who don’t have the same work ethic as you.

However if you’re like so many others who insist on buying a franchise do your research. Not just ask but get the real stats on how many franchises of a given brand have failed in the last 10 years. You will be shocked. If you find there are more than a thousand, two thousand, or even more you must know something is Rotten in Denmark.

Wishing everyone the best of luck with a great career in real estate sales.

Michael J. Stefonick, CEO

Optimix Marketing, Ltd.

506 Colonial Drive

Hilton Head Island, SC 29926


Executive Coaching & Management Strategies for Real Estate Professionals

RE/INVENTING Real Estate Brokerage To Improve Your Bottom Liine.

Real Advice/Real Results

A quote from a client: “ Mike your words are great. I’m glad you don’t have

any clients in my area”.


A quote from a RE/MAX regional owner: You are an expert on RE/MAX and

real estate brokerage. Your clients have no idea how much value they are missing by not listening.                                           


I have not been as active as I should have been in voicing my opinion on the economic condition of the real estate industry and that of it’s million plus brokers and sales agents. It’s time to get off the sidelines and express myself. In 1999 I retired from owning a very successful real estate franchise company named RE/MAX of Southeastern PA and DE. I once owned 4 RE/MAX franchise offices and sold hundreds of RE/MAX franchise offices and helped recruit thousands of high quality agents. After my retirement I decided I would enter the coaching and consulting arena and share with real estate brokers the many secrets of how to build a success business. Many of my clients became the most successful offices with the most successful brokers in the country. Coaching is not only about giving a client great marketing and recruiting concepts but also sharing with them how to stay out of trouble. TROUBLE IS WHERE WE ARE TODAY. Three years ago I saw where the business was headed. I suggested that my clients start to stack cash and build reserves. I even suggested that they divest unprofitable offices and consolidate into one large facility. After doing so I was instructed that I was no longer welcome at a specific franchisors convention. Obviously a franchisor wants open offices so they can claim being #1 at something. It really did not bother me because I was working for clients who trusted my judgement.  Many clients listened to my advice and did consolidate.  Many decided that the quest to grow by buying out other franchisee’s was not the prudent thing to do and hunkered down to ride out the pending crash in the real estate markets in Florida, CA, AZ, the Carolina’s and Nevada. There were others who just forged ahead and felt they had the answer and kept buying more franchises. After all that is what every Franchisor wanted and in some cases would even finance the purchase.  Most of those clients decided they no longer needed a coach and became their own self professed expert. The rest is history. The market crashed and many lost everything they had due to over expansion.  Today many franchisee’s of all franchise companies are at a crossroads. They wonder if they should renew their franchise relationship with the various franchise companies that are known nationwide. Many are desperate to cut overhead and cannot see the so called value of their franchise affiliation. I am speaking of all franchise organizations. Many brokers are creating their own brands and have figured out that paying all those royalties and national advertising fee’s are not worth the pain and the depletion of the bottom line.  This brings me to the point of this blog. When a client tells you they are subsidizing their office to the tune of $50,000.00 per month for two years and you ask why are you doing this, most feel they will get the money back. I say from whom will you ever get that money back? What is the value of a business that shows a loss of half a million a year, or 1, 2 or even 3 million a year? I have seen stubborn Brokers drain their families assets dry paying their respective franchisor monthly royalty fees on agents who were not producing in the climate we are in today.  My friends, things are not going to change overnight. The simple hard facts are that the standard of living in this country is declining. BROKERS WAKE UP!  The cost of living will be escalating due to all costs rising. Taxes, utilities, fuel, food, health care and even interest rates. We have witnessed the loss of retirement funds, devaluation of home equities, and a big spike in job loss. The next big crash will be the commercial real estate bust. From office buildings to shopping centers to local auto dealerships we are already seeing the demise.  All of these businesses employ people who have very little cash reserves. The result will be a spiraling of unemployed people. I lived through the days of Jimmy Carter, the former peanut farmer who is known for causing STAGFLATION.  I lived through the days of 18 1/2% FHA rates and a 21 1/2 % prime rate. It was almost bankruptcy for everyone in the business. I was not sure I would survive owning the first 2 RE/MAX offices in PA. Due to the impossible debt that this administration has imposed on it’s citizens there is no way that taxing the so called rich can ever provide the revenue needed to pay or payoff the debt.  Every one of us will incur huge increases in taxes.  The housing market is NOT coming back anytime soon. The second home market is DEAD so please think about your next move in the business. Many brokers are merging which even creates more problems long term but when you are desperate the short term is all that matters. Others are giving their companies away and going back to just selling real estate instead of constantly hearing from their agents that things are bad. Things are only bad for those who expect someone to walk through the front door. THERE WILL ALWAYS BE BUSINESS. There will always be people who want to list or buy real estate. That is a truism that is fact. What is also fact is the entire industry will change. The days of the 6 or 7 % commissions are over. The public has no more equity in their homes to pay anyone to sell their home. (A slight over statement but you understand what I am implying), so commissions will drop. The internet will become even more necessary and effective than it is today. Google will become a major player within the industry. http://www.brokeriptv.com/google-will-replace-realtor-com  The 900 plus MLS’s around the country will have to either merge or will be put out of business by aggressive private non Realtor type organizations such as the one being developed to serve all of South Carolina. The local Realtor Organizations will also have to merge to cut costs for it’s membership or else the Realtors will decide they do not need to pay all those dues every year. The bottom line is that all costs are rising and the Real Estate Brokers/Agents profit margins are falling faster than the Feds can print money.It is a new day and age. We have never before been so close to Socialism than we are today. If you think I am kidding wait until you hear about plans to cap your commissions like what is done in other countries. If the government can change the contract and security laws to disregard corporate bondholders everything is on the table.Unless we all stand together to stop this ridiculous spending and insidious corruption in government we will be a bankrupt country taken over by the one country we owe the most money to…China!  Personally I feel it is time for a THIRD PARTY whose elected officials would commit to a one term program and who will vote for what is good for the country and not voting for a bill that nobody ever read.  Now that I have expressed how I really feel over this matter take the time to view the video below.  I hope you had a great Memorial Day. Thank someone who you know who is risking their life to keep us free.  http://www.youtube.com/watch?v=lqkMfToY9Pk Consider these factors prior to signing an agreement to purchase a Real Estate Franchise.Once it is signed it’s too late to change your mind!Do I really want the responsibility of managing others?Am I sensitive to people, their desires, their fears—do I have empathy?Can I motivate, direct and lead other people?Am I creative—can I bring new ideas to the sales team?Do I listen to only what I want to hear?Do I create an atmosphere where subordinates can express themselves?Do I recognize that the real strength is in my people—not myself?Do I understand the principles of two-way communication?Do I lose my temper when an associate questions my decision?How much criticism can I take from my people?Can I make a decision?Do I realize that my program will not work without complete and eager participation from my people?Do I treat everyone fairly, or do I tend to have “pets”?Do I have the courage to carry out company policy—no matter whom it may hurt?Do I really want to see other people succeed?Do I understand when I have to be the boss and control my people?Do I know how to make a profit and develop my business?Am I willing to pay the price to be a manager?Do I love people?Am I a manager or am I being managed by people and situations around me?This excerpt is from the 1985 Realtors National Marketing Institute booklet

Before you decide to buy into a Real Estate Franchise ask yourself these questions.

Why do I want a franchise?

What is your motivation?

Is it Control or Ego?

Is it to earn more income? If so how much?

Do you really want the responsibility of managing others?

Am I willing to pay the price to manage others?

Am I an effective communicator?

Am I perceived as a leader who can be trusted?

How much empathy do I exhibit for other sales associates?

Can I make a decision?

How many years are you willing to wait before the business breaks even?

Do you really understand business even though Read more…