DOSS: Why are “REAL ESTATE TEAMS” paying SIX-FIGURE CAPs?

Since teams became a thing, most of them throughout the country are mostly with big box brands. Coined by a particular brand, most of their revenue comes from these mega teams who over the years have most recently been referred to as a teamerage. A teamerage is typically made up of a bunch of agents, and its compensation and support structure is very similar to that of a brokerage. They may operate under a team brand, but they don't share much else. So, if they don’t share much else, why do these teams pay so much to be affiliated with these big box brands? That’s what I plan to explore in this intriguing article. The cost to belong!?

For the purposes of this example, we will use the fictitious name The Real Estate Store, powered by OLD SCHOOL. This powerhouse team is based in Portland, Oregon, and is led by a successful REALTOR? with a decade of experience in the industry. The Real Estate Store manages and markets its own brand, uses its own signage, and boasts a highly productive team of 12 Agents that closed over 300 units in 2022, totaling $126M in volume. Despite being affiliated with a brokerage that provides technical tools and training, The Real Estate Store has developed its own systems and directly subscribes to third-party providers. They cultivate, originate, and purchase their own leads, and their brand is well-known throughout their entire market. However, they paid almost $180,000 in CAPs and franchise fees.

In 2023, The Real Estate Store aims to expand their team and increase their market share. However, they are aware that every time they add a new agent, their CAP increases. Despite this, they remain determined to grow their team to 20 Agents and close over 400 units, totaling $200M for the year. If they achieve these goals, they will pay their OLD SCHOOL brokerage approximately $250,000 in CAPs and Franchise Fees for the year. While the OLD SCHOOL brokerage didn't have to do anything other than sponsor the additional licenses, they have benefited from the team's growth and increased revenue. Moreover, since The Real Estate Store is self-sufficient, the OLD SCHOOL brokerage will not incurred any additional costs for their systems, support, or technology to accommodate the newly added agents to the team.

At one point, the idea of paying CAPs and HALF CAPs for additional agents made sense, especially since it was the norm for most traditional brokerages. However, as the real estate industry becomes more competitive, teams like The Real Estate Store powered by OLD SCHOOL now have more options to drastically reduce their costs. With more brokerages adapting to the team model, the cost of services has eventually come down. Why pay hundreds of thousands of dollars in fees each year when those funds could be reallocated to increase production by purchasing more leads or expanding their marketing budget? It's important to note that most teams aren't even utilizing the broker's brand, marketing materials, or tools anyway. As such, cutting costs altogether or using those funds in more productive ways could be a wise choice for teams looking to maximize their profits.

At DOSS, teams like The Real Estate Store are only required to pay a fixed flat $50,000 CAP. In their pursuit of reaching their CAP, they only have to pay a transaction fee of $495 per closing, along with a $45 E&O fee. The best part? There are no franchise fees of 6% to 8%. Once the team reaches their CAP, they only have to pay a $95 franchise fee and the $45 E&O fee, totaling $140 per transaction. Adding more Agents incurs no additional costs, which means teams can grow as big as they want without being penalized. Similar to traditional brokerages, teams can use their own brand and signage powered by DOSS. Teams also have the flexibility to choose which technical tools and services they want to use, and can even decide whether to attend our training or not. With DOSS, teams have full control over their business operations while receiving support from us to achieve their goals and objectives.

DOSS: BETTER. FASTER. SMARTER.?