Profit – The Most Practical KPI for Tenant Rep Success

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We have defined success for tenant reps through our previous post on “How to be a Succesful Tenant Rep” as happy clients, more referrals, enhanced reputation, bigger pipeline, increased revenue streams and greater profitability.

In this post we will discuss in more detail the 3rd and last P – Profit, which we have defined as;-

Profit depends on consistency and repeatability in delivery

Although it seems like stating the obvious, it is remarkable how many businesses forget that profit is a result of generating more income than expenses over any given reporting period. Increasing profit will result by decreasing costs when maintaining or increasing income or conversely by increasing income whilst maintaining or decreasing costs

If we are to assume that the fixed costs associated with running a tenant rep business remain relatively stable and constant, then it is the variable costs that we should concentrate on to improve profitability. In a tenant rep business these costs are primarily related to business development and labor costs associated with tenant reps, admin staff and business development staff (assuming that not all of your tenant reps find and execute their own work).

Therefore our previous article on productivity and efficiency (click here) is particularly relevant. Finding or creating systems and processes that will both improve productivity and increase efficiency will prove most valuable to tenant rep business profitability. Areas for focus include;-

  1. Tools/Systems or processes that would allow tenant reps to run with more clients simultaneously. Therefore systems that reduce staff time, whether they be tenant reps or admin staff members.
  2. Tools/Systems or processes that would allow tenant reps to more quickly identify the perfect office space that best meets the needs of their clients.
  3. Tools/Systems or processes that ensure that lower salaried staff (or commission only staff) can be trained and become productive more quickly, whilst also ensuring consistency of your service offering to the marketplace in a manner that maintains or improves your businesses brand and reputation.
Generally speaking there are 2 ways to increase income for your tenant rep business and they are;-

  • More Clients
  • Higher Commissions

Building upon the discussion above, success in these 2 areas is dependent on finding or creating systems and processes that will both improve your chances of both attracting and then delivering outcomes to more clients, whilst also delivering higher commissions back into your business. To do this the following should be areas of focus;-

  1. Tools/Systems or processes that would allow tenant reps to run with more clients simultaneously. Therefore systems that allow each tenant rep to deliver more outcomes to a greater number of clients at the same time.
  2. Tools/Systems or processes that ensure that the outcomes generated for your clients results in them becoming a positive net promoter of your business resulting in more referrals and increasing brand recognition.
  3. Tools/Systems or processes that ensure that your clients are happily placed into higher quality buildings than they may have originally budgeted. This will generally result in a higher commissions for your business

When the outcomes described above can be delivered consistently and reliably, the process of the 3P’s will then have succeeded in creating a positive feedback loop of success for tenant rep businesses. Where strong systems and processes will ultimately feed pipeline and combined with improved productivity and efficiency will result in improved profitability.

Success will be very sweet indeed!

Click here for more information on how our Blueprint² tool will deliver on the 3P’s

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