Top 3 Expansion Pitfalls and How to Avoid Them
- Wrong Hire
There are many aspects of a hire that can be wrong. Here are key factors to consider:
Motivation / Goals: Some people just don't want to work that hard. In expansion you want those that want to grow with your opportunity, not someone that will hold you back.
Team Player / Culture: It's not uncommon to have a sales "rock star" but a toxic team member. One toxic team member can create more damage than they can ever offset. Beware of these bad apples, they can set you back tens of thousands of dollars, countless hours of your time. The pain and aggravation is not worth it. - Lack of Lead Gen
There are different concepts of where and who does lead gen.
Option 1: The "hub" or "mothership" do all the lead gen and prospecting.
Option 2: The agent does all the lead gen and prospectin.
Option 3: Combination of the agent and hub.
The key is to set those expectations clearly up front. - Low Average Sales Price
No matter how great everything else is about your expansion, if there is not enough to go around, there's just not enough to go around. For example, in an area with an average sales price of $100,000 or less, the gross commission is so small that expansion is not economically feasible. Make sure you consider the average sales price of a market before entering it.
