Tuesday, June 26, 2007

Can Business Be Too Good?

The Service Roundtable offices in Grapevine, Texas. Bordering the northern edge of DFW Airport, Grapevine is the junction for a number of major highways. It's accessible to nearly everyone in the Dallas/Fort Worth metroplex.

Not only does the town have a great location, but it has a certain degree of cache. Grapevine has a quaint downtown with lots of galleries, restaurants, and wine tasting rooms. The area is growing. The real estate market is soaring. Demand is on the rise.

Several months ago, we began a quest to search out new office space. We've called about lease space. We've considered buying property. It's been frustrating.

It's hard to use the Internet. If I want to search for residential listings online, it's pretty easy. Commercial is another story. There's no central clearinghouse like Realtor.com. Each commercial real estate broker has its own website,
if it has a website at all. Most do not (at least, the sites aren't listed on the "For Lease" or "For Sale" signs).

When we call, we seldom reach a human. Presumably, the agents are out hustling. However, the majority do not return a phone call. Think about it...

A. You sell for a living (even if you don't, pretend you do).

B. A buyer calls.

C. You return the call.

That's the way it works in a sane world. The commercial real estate market in Grapevine is not sane.

A friend from Cleveland was riding with me while I took a look at some property. We drove by a small office with a "For Lease" sign out front. I immediately called. Surprisingly, someone answered. The available space wasn't large enough. I told this to the person on the phone.

I waited two beats, thanked the person, and hung up. Turning to my friend I asked, if he noticed anything unusual.

"Yeah," he said. "She didn't try to find out how much space you needed or offer any other offices to you."

Bingo. It was the classic response of an order taker, not a salesperson.

Grapevine's commercial real estate market is too good. The salespeople don't have to sell. Apparently they don't even have to answer the phone or return calls. I still don't know how some of them make a living.

The problem with hot markets is they eventually cool off. When that happens, the order takers will be in trouble. The real salespeople will eat their lunch and drive them into other occupations.

Real salespeople hustle in a good market and shift into another gear when things cool off. They recognize soft markets are opportunities to drive out the competition, secure more share, and position themselves for a great ride when the market turns.

Good markets are like the high tide, carrying everyone over the shoals. In a soft market the tide lowers, the rocks appear, and the salespeople who know how to steer around the rocks will still do well. The order takers will crash.

Can business be too good? Never. Yet, a weak market every now and then will help clean out the order takers.

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