One of Australia’s oldest real estate groups launched a staff retention fund in January designed to turn agents into shareholders. It’s just part of a long history of innovative strategies for this leading network.
The Hodges Future Office Fund was officially launched on 1 January this year. The way it works is pretty simple: staff receive $100 for every sale the agency makes.
Hodges Real Estate CEO Carmel Baker, who joined the growing network in September last year, says she came up with the idea while touring the franchises and discovering what she described as the high calibre of staff.
“I wanted to find a way to encourage them to be with our business over the long term. In this day and age, people tend not to stay with one organisation as long as our parents used to,” she says.
Ms Baker said the Future Office Fund is designed to get agents to think about their long-term future and increase their financial security.
It should also make the group more attractive to potential recruits. However, one of the key reasons behind the fund was the high turnover rate in the industry.
“When I joined the business I looked at the retention rate and, while it was higher than the industry norm, the industry as a whole has a really poor retention rate of staff,” Ms Baker says.
“We also work in an industry where a lot of money can be made by those that are good at their trade. Over my career I have spent a lot of time with small business owners and trying to educate people on wealth-generation strategies. What I have noticed is that everyone tends to live within their means and while you might earn a good income, that doesn’t necessarily translate into a wealthy individual.”
The fund effectively allows agents to create their own wealth, while also retaining them over the long term. However, it’s not just real estate agents that benefit from this innovative idea.
“We have people in our business who have started in a receptionist role and gone on to become a director of the organisation,” Ms Baker explains.
“I wanted more of that.”
Ongoing training and education plays a key role in the company structure, and plays into the value of the fund for Hodges employees.
When a staff member with a fund has completed all of their training, from cadet to leader, and is skilled not just in selling but in leadership and management and is ready to take that next step, the agency then allows them to use the money in the fund to either buy into the business that they are working in or put it towards opening up a new office.
“When we first launched the fund the response was overwhelming,” Ms Hodges says.
“The day we launched it, that evening I went to a function in Geelong and one of my staff said that I had single-handedly made them never want to leave the business. I never expected the response to be that strong. People have genuinely engaged with the program.”
While Ms Baker is relatively new to the organisation, her innovation will be added to Hodges’ 160-year history of new initiatives. The network boss explains that when she first started with the company last year, she was eager to understand the business’ core values.
“I looked into the history of the company to see where it had come from. One of the overwhelming pieces to come out of that research showed me that the company’s history has been full of innovation,” she says.
Hodges claims to be the first agency to have lights on signboards, the first to take customers to properties in a horse and cart, and then the first to take clients to properties by car.
“We were the first to have radios in our cars so that agents could communicate,” Ms Baker says.
“So innovation has been part of our DNA. It is really important to make sure the legacy I leave with Hodges includes putting the same innovative stance on the business.”