In his poem, “Mending Wall,” Robert Frost wrote, “Good fences make good neighbors.” By that Frost means that good relationships require clear boundaries. The same can be said of your relationships with clients. If you establish good fences first, you can avoid problems that occur when fences don't exist.
Fences define your boundaries. They communicate to clients who you are, and what you will and won't do. As a broker, you need to build two types of fences: tangible and intangible.
In our business, tangible fences have to do with compensation. The building blocks of your fence are the fees or commissions you charge. You need to construct a fence that allows you to be compensated fairly for your efforts. If you feel you are not properly compensated, it is only a matter of time before resentment builds and compromises your ability to work effectively with clients.
Create a compensation policy. Brokers often struggle with the issue of discounting fees and commissions. Having a policy about discounting in place matters as much if not more than whether you decide to discount.
Your policy should also address what you believe is fair and equitable pricing for both you and your clients. And you may wish to consider quoting the lowest amount you think is reasonable. You should “know your floor.” If clients do not find your “floor” pricing acceptable, you will not proceed. If you set a bottom number, you will be in control.
Some clients love to negotiate. But others will be relieved to know you have an established fence. These clients won't have to wonder if they could have done better. And those who love to negotiate will accept your fence if you are giving them something of value. Keep in mind, clients may be able to buy a product elsewhere, but they can't find you or your service elsewhere. Even the most ardent online traders are sobering up to this reality.
Intangible fences are more subtle, but perhaps more critical. You must set boundaries regarding what you will accept from clients in terms of behavior. Intangible fences let in clients' appreciation, goodwill and respect toward you, and keep out negativity and mistreatment. You need to establish the line between forthright discussion and abuse.
Intangible fences also need to be constructed regarding your availability to clients. Do not oversimplify the issue by assuming that availability is always desirable. Some brokers pride themselves on their unlimited availability and wear it as a badge of honor. But be alert that certain kinds of availability foster respect and appreciation, while other kinds foster disrespect and cheapen your value.
And although it should not be a common practice, you also need to consider which of your intangible fences you may allow clients to breach occasionally. Some situations may require you to adjust your boundaries because it is reasonable and the right thing to do. But be sure you set criteria for changes. The aim is to bend when appropriate, but not bend over.
If you do not build fences, your property will shrink smaller and smaller. Without legitimate boundary lines, clients will want more of your fees and more of your time.
Build fences and help your clients be good neighbors.
Theodore Kurtz is a psychoanalyst based in Cold Spring Harbor, N.Y. He coaches brokers in overcoming performance issues. He can be reached at [email protected].