The right moves: Don't end up working longer for routine fees
I had a lot of reaction from agents to my recent column on the dilemma of whether or not to "gear up" again, to meet another cycle of rising demand for services.
Several people told me their staff are working flat out, some not taking holidays, in an effort to service the business. Meanwhile, it is very difficult to get qualified and licensed staff.
Two solutions I offered were diversification and increasing commission structures for staff, to reduce exposure to a future downward cycle. However, I also believe that all professionals in a busy and rising market should reassess how they work. As professionals, we earn routine fees for doing routine technical work. One way to improve our business is to work harder and do even more routine work, for more routine fees. The downside to this is that most property professionals are probably working close to capacity and working an extra 10 hours per week is likely to lead to health and relationship problems. That extra work will be increasingly unproductive and will make little overall difference to your earnings.
According to Dale Carnegie - and I couldn't agree more - the real opportunity is to reduce the number of hours spent doing routine work for routine fees and instead spend time developing your non-technical skills, especially your "emotional intelligence". This is where your ability to win better clients and better business comes from, the ability to forge long term relationships which allow for higher fees and the skills to inspire your staff to do likewise. This is really "adding value" - a small but focused effort in this area will reap big rewards.
I'm greatly enjoying speaking for Bank of Ireland at various "Enterprise Town" events and last week saw me in Stillorgan and Balbriggan.
These events offer local firms a chance to show their products and services, and bring together chambers of commerce, local authorities and others.
As I visit various towns around Ireland there are strong common issues for businesspeople, and retailers in particular. These are typically what is seen as unfair competition from too many "out of town" centres who have easier access and cheap, or free, car parking. Conversely, many retailers feel that town centres have been made inaccessible to motorists and car parking is too expensive. Consequently, many town centres have gone into a downward spiral and every extra shop that becomes vacant reduces the appeal of the town to shoppers.
I spotted an article in the "Daily Telegraph" last week on a hugely successful experiment to regenerate Rochdale High Street. Rochdale is a very disadvantaged suburb of Manchester and I have been there several times.
The High Street had deteriorated to the stage where more than half of the shops were vacant. In desperation, the local authority implemented a rates relief scheme for new shops opening, with an 80pc reduction in rates in year one and 50pc in year two. The experiment has been a great success; the street has turned around rapidly and is near full occupancy.
More shops opening attracts more shoppers, so retailers do more business, rental values rise and rates income increases. It's a solution which local authorities here should copy.
In the US, contacts tell me there is a renewed take up there in "working from home," which saves commuting time for workers and frees up desk space in office buildings.
This trend never really caught on here and I suspect many business owners are uncomfortable with the difficulty of supervising work done outside the office. Some workers I know that have tried homeworking, whilst not missing the commute, missed the interaction and support of colleagues.
Recently, in the US, I spoke with Craig Smith, an experienced surveyor with Colliers in Florida. He too confirmed a revival in the working from home trend which he believes is now affecting demand for office space. He says that a "tipping point" occurred there within the last five years when every residential location in the states was supplied with broadband speeds as quick as those available in office buildings.
It will be interesting to see if there is a renewed interest in the practice here, given a shortage of office space, worsening commuting times and the gradual improvement in broadband speeds.