As we look forward to a relaxation of lockdown, albeit with a range of stringent safety and social distancing measures in place, businesses should be drawing up risk assessments and plans for the “new normal”
Understandably, for the last few weeks, businesses have been largely focused on reducing costs and preserving cash – this has been vital - but it is impossible to make profits by cutting expenditure alone. The next phase – recovery – will require businesses to continue to run “tight ships” but also to drive new business and revenue generation.
Customers and clients will have a mixture of emotions and views on a relaxation of lockdown. This will vary from a desire to “get on with it” to anxiety and possibly fear as to the way ahead. The same will be true of those operating in the property industry.
One of the key elements will be staff. When and how do you bring them back into the workplace or perhaps whether you should bring them back at all?
Those staff that have remained employed during “lockdown” have probably been busy and have learned new skills such as better use of video technology. Those staff that have been furloughed in good organisations have hopefully also been engaged and developed their knowledge and skills during this period but, sadly, in many cases, I fear not.
It will be vital that staff returning to the workplace are motivated and capable of delivering the levels of performance that will be demanded by an industry that will need to rebuild itself quickly if it is to survive. Businesses must also provide the reassurance of safety and security for staff to be able to focus. The need to have one’s “mojo working” has never been greater.
Many business owners have made great efforts to ensure that their teams have remained engaged and positive during this period and have provided training and development programmes as well as social and team bonding activities. Some have rotated their furloughed employees in a further effort to avoid them going stale.
Many good individuals will have taken it upon themselves to undertake programmes of self-development to improve themselves and make themselves more valuable in the new order of things.
However, and unfortunately, many will have spent weeks drifting, getting up late, sitting in the garden and idly feeding themselves with negative input from social media.
Industry leaders should therefore be thinking now about who they want back in the businesses. Have their staff demonstrated value during this period or simply gone missing in inaction?
Of course, new working practices are developing and, with the likelihood of social distancing being with us for some time, premises will need re-thinking. Re-planning in terms of how they can be used but also in terms of need. Are there opportunities to shed space and reduce overheads or to renegotiate lease terms in a world where remote working has increased and is likely to continue at much higher levels than before.
Likewise, with technology. Has your business’s technology partners and suppliers been a help or a hindrance during this period? Irrespective of whether they reduced charges or not, the real question is, did they, and will they, add real value to your business?
How easy has it been for you to work remotely? Can your customers and clients engage and transact via your software and technology platforms? Have you been able to increase productivity, improve service and generate new income streams? Or has it been a case of just trying to maintain the status quo and not go under? Are you paying individual licence fees when now, and the future, you may have less employees? Those employees may also be working different shift patterns and from remote working locations. Can your software cope?
The use of portals has been a “hot topic” in the last few weeks and not all have covered themselves in glory in their response to the industry’s needs. I fully expect agents to review and reduce their portal expenditure and exposure. For example, no longer advertising on all three major sites and possibly trialling one or more of the new entrants that we are seeing. Of course, it is ultimately about return not just cost but so few agents have really been able to quantify this.
I do expect many agents to get much better at maximising the return from their own databases and social media, further reducing their reliance on the portals who provide basic reach, but where over 99.5% of “visitors” fail to actually transact.
Outsourcing provides opportunities to operate parts of your business on a pay as you go basis, reducing fixed costs and reducing the risk of exposure to market fluctuations.
The aforementioned “fixed costs” are one of the property industry’s biggest issues and the four big “fixed cost” Ps – People, Premises, Portals and Proptech alongside Proposition greatly affect the two crucial Ps of productivity and profit.
Proposition is an interesting one - has your business developed new processes, services and a new customer experience? Are you making it easier for customers to do business with you and to diffrentiate and stand out from the crowd? With cashflow going to be key in the coming months, is a model that sees sales fees being paid after completion the best way forward? Can you get clients better prepared, speed up transactions and reduce expensive abortive work? Legal packs arranged at the point of instruction and reservation agreements may all play a part in the "new normal".
In my role as an adviser and mentor to hundreds of estate agencies and as a Director at lettings platform teclet, I can see dozens of fabulous opportunities in the weeks, months and years ahead for those who are prepared to challenge existing norms, innovate and make the changes needed for success and I am enjoying working with many of them on their future plans.
Remember, it was Einstein who famously said: “the definition of insanity is to keep doing the same things and yet expect a different result.” He may not have been an estate agent but he was a “genius!”