Business owners like you shoot for the stars - brokerage expansion likely brings a twinkle to your eye and a spring to your swift step. One thing’s for sure, business growth puts more bang into your buck. But in challenging times like these, expansion may seem unattainable.
If you’re wondering how to grow your office operations even as current events damper your real estate dealings, you might consider adding an ancillary business to your brokerage. This type of addition offers your customers a new service or good that is related to or supportive to your primary business. Just as importantly, an ancillary service may diversify your revenue and help you weather this COVID-19 storm.
Think of the added convenience of getting your car washed and grabbing a cold beverage after filling your gas tank. Both the convenience store and the drive-through car wash are ancillary services that diversify and expand a gas station’s revenue streams.
Consider the gift shop at your favorite museum. It’s certainly not the reason for your visit but is an opportune location for commemorating your experience or purchasing that birthday present you’ve been meaning to select. The museum gift shop is, yet again, an example of an ancillary service that adds to the principle business’s income.
As an owner of a real estate brokerage, look at ways you can streamline or enrich your customers’ home buying and selling processes. These solutions may be viable ancillary businesses. Services closely related to the primary functions of a real estate brokerage include:
- Mortgage services
- Title services
- Home insurance services
- Property management services
- Staging and cleaning services
By providing these (or other) ancillary services at your brokerage, you’ll not only diversify your revenue, you’ll enhance the experience of your office’s clients.
Many real estate agents recommend that their house-hunting clients get mortgage pre-qualification before even beginning to look for a home. Imagine if those clients could conveniently obtain this information from someone at your office! Picture the possible synergy between the loan originators and the real estate agents. From pre-qualification to mortgage loan attainment (and everything in between), your clients could have coordinated team at (or near) one location – and you could benefit from more transaction opportunity via every purchase closing.
Additionally, mortgage – unlike real estate, title or staging - can operate independently of home sales. To be sure, borrowers seek refinances for many reasons. They may be looking to secure a lower interest rate, reduce their monthly payment by extending their term, pay off their home sooner by shortening their term or invest in a home renovation through a cash-out refinance. This diversification in opportunity can stand alone from the state of the real estate market and can offer expanded revenue options in times of sluggish home sales.
As you know, a title company is an essential player in every real estate purchase. Add this component as an ancillary service and experience exciting closing days at your office while opening the door to more revenue streams per home purchase transaction.
Another key-player in the home purchase process, home insurance offers great potential for integration as an ancillary service. For the same reasons as mortgage and title, adding insurance services to your business has the potential to maximize your current home purchase transactions and consolidate the efforts of your customers.
Staging and Cleaning
These add-on services could be a wonderful fit if your agents recommend staging and cleaning often. Benefit from the ability to create a steady stream of in-house referrals for such home sale best practices and make the process a breeze for your customers.
How to Grow Your Real Estate Business
If planned and executed strategically, adding an ancillary business to your real estate brokerage could offer growth in your local market. You might even consider adding another service once the first is off and running! You can think of these complementary new services as options for diversification of your revenue stream. But perhaps most importantly, offering more robust services to your customers could provide the very best home buying and/or selling experience around.