Like everything else in life, it boils down to the almighty dollar.  The greater share of their commission that an agent can keep, will result in a higher recruit rate for the broker/owner.  Also how about developing the Agents that you already have, I think that makes more sense than recruiting.  I would rather have a handful of great Agents than a dozen ineffective ones.

Well money talks and B.S. walks... and while I think the "almighty dollar" is at the root of a lot of decisions, there is a balance to it... or should be.

I encourage my students to take a hard look at themselves as well as the agencies they are considering. A "true" entrepreneur with lots of time and energy may do quite well with a high commission split and full responsibility for his/her business.

Others might do better with a lower commission split and an agency that takes care of some of the tasks and expenses. (I have worked with agents who couldn't afford business cards.)

I had to chuckle at the mention of a fee of $399 per transaction. I've seen sales in this area where the entire amount on one side of a transaction isn't much more than that.

There just isn't a one-size fits all answer. In the end, for agent and agency, it's about revenue, fixed expenses, and variable expenses and figuring out how to juggle those three numbers is there's some money left over.

Within the Phoenix valley, there are at least 50 other "100% shops" who charge minimal office fees and low transaction fees. And, yes, my brokerage is one of them. I know what it takes to make sure we stay "in the black" and it isn't necessarily just "hiring the numbers" to see who can have the most agents on the roster. (I guess my corporate world management background is helping me with this one!!)

There are agents that I will not hire ... but I will not hire them because a 100% shop is highly recommended for the experienced agent. All 4 of my Managing Brokers and I provide training (classroom and one-on-one); we are available for assistance should any agent need help at any point in a transaction; we do not have the mandatory weekly meetings (which no one shows up to because they have a litany of excuses why they can't show up); and, because we don't have the weekly meeting, all of our agents receive a weekly email from me with information they need to know; etc.

My costs are very low because I don't need the 5,000 sq ft offices with all the glitz and glamor. We have 3 primary, very professional offices where agents can meet clients if needed. I have a full training center in my corporate office. My agents work from their homes. The agents may come into the office a couple times a month to pick up their mail. I truly hardly ever see the agents.

YET ... I electronically communicate with them every week. They know all Managing Brokers and I care about them. They know we want them to know everything WE know -- if not more --- simply because it makes our jobs easier. Many, many of them have told us they get more support from us than they did with their previous split shops.

No .. there just isn't a one-size fits all answer. The agent and the brokerage must feel comfortable with what they get from each other. Does the support flow both ways? Is the agent willing to pull the dollars together to try to stay in the business during this economy? And is the agent doing this because the Brokerage is encouraging him/her?

All of my agents who are leaving (so far about 12% of my roster have left) know they are welcome to return to me when they are ready. My business plan allows for this loss -- I'm just very fortunate that we are also hiring one agent for every agent who is going inactive. My roster is actually even with where I was 12/31/08.