What Does 2023 Hold for the Mobility Industry?

I have absolutely no idea and no one else does either. Economists and industry leaders can forecast, but there are so many variables that can influence our path forward, no one really has a firm grasp on the future. Some are saying there is a recession coming. No matter what is ahead, I see opportunity.

Here is what I do know. Every broker owner and senior leadership is looking at their bottom line and budget right now to plan for 2023. They are evaluating the various departments that generate revenue and the ones that are cost centers. They are comparing your P & L year over year to see how your business lines are performing. If you don’t regularly see your financials, now is the time to request them on a monthly basis.

Control the narrative

But I recommend you control that narrative. Don’t shirk your responsibilities as the head of the department by waiting for them to call a meeting with you. Approach your leadership to discuss your budget for next year. The key is to come up with a plan, not be told what to do with no input from you.

Before you set the meeting, do a complete analysis of your last five years of performance. I typically say two years, but we can throw 2020 and 2021 out the window. They were anomalies. The key is to compare 2018 and 2019 to 2022. You will likely have fewer units closed in 2022, but with increased sales prices your bottom-line profit and revenue may hold up against previous years.

The easiest way for a broker to save money is to cut bodies. Headcount is the most expensive line item they have and that is their first instinct to cut. But there may be other ways to get to the end goal, which is not only having fewer expenses but also generating more revenue.

Take a hard look at all of your expenses. Are they all really necessary? Do you need to attend every event or conference you are invited to? What about local expenses? Instead of feeding the agents at a live training, do it in off hours and skip the food. Every penny adds up. Consider dialing back on the holiday parties and gifts to help end the year with a better bottom line. Agents and staff will understand if you explain that cutting expenses is critical at this time. I assure you agents are all mindful of their spending right now and even though they may not like cutbacks, they understand.

Do a once-over of your financials to ensure that there are no expenses being charged to your department that shouldn’t be. Cut the low-hanging fruit first. Then take a look at your staff. Could some staff be shared with other departments or temporarily moved to part-time? Might you offer early retirement to someone? Before you get the order to make cuts, find a better way to trim expenses without completely losing your valued talent.

Don’t just focus on expenses

The goal is to offset our expenses with more revenue. But how can we do that when relocations are down? By targeting new opportunities. We have no idea if or when corporate relocation will return to its previous numbers. Corporations are still figuring out their remote work policies and their own budgets that include rising costs and transferees who are hesitant to move due to increasing interest rates. Mobility programs are dusting off their mortgage buydown and MIDA policies to address the new challenges for their transferees. These market changes will diminish the number of corporate relocation opportunities for at least the near future.

Think about where the opportunities lie. Are you capturing all of the business you can in your market from your existing sources? If we can’t count on corporate relocation, we have to look at local buyers and sellers that can come from other sources such as internet leads and homegrown affinity programs. Continue to market to other brokers around the country to ensure you are the recipient of their ‘self-move’ agent-generated referrals.  

What programs can you develop to tap into specific target groups? That may mean creating some niche programs for first-time homebuyers, military members, first responders, or senior programs, as an example. Focus on no-cost marketing opportunities like social media and email campaigns to reach that audience. Take a look at your specific market. What is it known for? Who makes up your key demographics? Who do your leadership and agents have relationships with that may help you with warm introductions? Once you figure it out, then it is time to create the programs and establish the marketing strategy. Also, tap into other revenue sources that may not be directly tied to a real estate transaction.

I continue to hear from Relocation Directors around the country that business is slow. That means you have more time on your hands, or at least your staff does, which means you can delegate tasks to them so you can focus on a solid business development strategy. Don’t sit there and wait for your leadership to determine how you will maneuver through this economic phase. It is time to shift from operations to business development. Take the bull by the horns and control your own future. I can help you.

“Control your own destiny, or someone else will.” ~Jack Welch, an American business executive, chemical engineer, and writer.