Property Management Growth with DoorGrow DGS 141: What Should I Pay A Property Management BDM & How To Onboard Them
What is a BDM? How do I pay a BDM? Why call them a BDM and not a salesperson in a property management business? Why do I need to make sure a BDM has the right personality type and how do I onboard them correctly?
Property management growth expert and founder/CEO of DoorGrow, Jason Hull, talks all about BDMs. If you do all the vetting right, then the real challenge is supporting and training them to be successful.
You’ll Learn...[01:42] What is a BDM? It's a Business Development Manager.
[01:46] Why a BDM and not a salesperson? Sales gets convoluted or confused.
[02:00] Why? Most of you do real estate and have a brokerage side to the business.
[02:50] Mistakes: Feedback from companies that help you find/place a BDM isn’t good.
[03:24] A business owner not good at sales or onboarding doesn’t give the right support.
[05:24] How can you properly support a BDM or salesperson? Know what works.
[06:02] How to pay BDMs: If you pay on commission, offer an initial bonus structure. [08:17] How to onboard BDMs: Start them as a sales assistant to double capacity.
[10:00] Motivate BDMs: Driven salespeople like money, give them part of commission.
[13:32] What sales is/isn’t: Once you start winning deals, sales becomes fun, not pushy.
Tweetables“BDM is really just a fancy word for somebody that's supposed to help you grow your business, supposed to come in, supposed to do sales.”
“If you are not good at sales, my recommendation is you have to figure this out. This is one of the biggest key areas of the business.”
“I love seeing that shift in clients where they have the confidence that they know they can get pretty much anybody on if they want them because they're that good at sales.”
“It doesn't make sense to pay people based on commission unless the commission payout is big.”
Resources TranscriptWelcome, DoorGrow hackers, to the DoorGrowShow. If you are a property management entrepreneur that wants to add doors, make a difference, increase revenue, help others impact lives, and you are interested in growing your business and life, and you are open to doing things a bit differently, then you are a DoorGrow hacker.
DoorGrow hackers love the opportunities, daily variety, unique challenges, and freedom that property management brings. Many in real estate think you're crazy for doing it. You think they're crazy for not because you realize that property management is the ultimate high-trust gateway to real estate deals, relationships, and residual income.
At DoorGrow, we are on a mission to transform property management business and their owners. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. I'm your host, property management growth expert, Jason Hull, the founder and CEO of DoorGrow. Now, let's get into the show.
What are we chatting about today? In continuing my series of doing this every Wednesday, we're going to be chatting today about BDMs. What is a BDM and how to pay them? This is a really common question I get, how do I pay a BDM? How should I pay them? So that I don't have to answer this question anymore, I'm going to make a podcast episode about it. Here we go.
First, what is a BDM? It's a Business Development Manager. Why do we use that term instead of a sales person in a property management business? Because a salesperson, or sales, or anything connected to that usually gets convoluted, or confused, or mixed up with brokerage because a lot of you also do real estate and have the brokerage side of your business.
I think what's happened over time is the industry has sort of adapted that a property management sales person is called a BDM. And we get that from the Australians. They seem to call them BDMs or Business Development Managers, and I think it's just so we don't get them mixed up with the real estate sales people or people that just do sales. On the real estate side, anything related to sales tends to be considered real estate. In the real estate industry, even if it's property management, it gets mixed up.
BDM is really just a fancy word for somebody that's supposed to help you grow your business, supposed to come in, supposed to do sales. There are a lot of mistakes I see people make. I have not heard good feedback on companies that help you find a BDM and place a BDM. I don't think it's those companies' fault, I don't think that it's their fault. They probably do find people with the right personality type, maybe they're on a DiSC profile, they're high D, high I, maybe they have an economic score on a value index on a DiSC, maybe they love doing sales, maybe they're good at sales.
I think what really ends up happening a lot of times is that a business owner is not good at sales which is why they're hiring them, or the business owner is not good at onboarding a sales person, which if you're not good at sales you're not going to be good on onboarding a sales person and giving them the right support that they need anyway.
Let's touch on that first. If you are not good at sales, my recommendation is you have to figure this out. This is one of the biggest key areas of the business. If you cannot generate revenue on demand, you cannot figure out how to bring in business, you need to figure that out. You don't have to do it forever, otherwise you need to bring in a partner into the business that is already an expert. Not just hiring some salesperson you're going to try to convert into a BDM. You're going to have to find somebody that successfully added hundreds of doors as a BDM into the business and partner with them or bring them in into your business. Otherwise, just getting a sales person, trying to turn them into a property management BDM is not going to be effective unless you know how to do it yourself.
My recommendation is put in the reps, take the time, become an expert at this and figure it out. If you struggle with that, I'm really good at helping people improve that area, get really good with that, and we do that in our program. It's awesome to see the transition of people going from, well, I'm not really super great at sales or my close rate isn't really high, to them saying what I typically hear is, I feel like I can get anybody on that I want so now I'm picky and I don't want everybody. That's a huge shift. I love seeing that shift in clients where they have the confidence that they know they can get pretty much everybody on if they want them because they're that good at sales.
I won't go into sales in detail on this podcast. We're not going to go into this episode into sales, but you need to make sure that you can properly support a BDM or sales person coming in. What does that mean? That means you know what works. You have successfully proven that you can bring on business, you have scripts, you have language, you have recordings of calls, you have examples to give them. They can shadow you. You know how to deal with all the different objections and challenges that tend to come up. If you have that, then maybe it's time to bring somebody else in.
There's another challenge. The other challenge is a lot of BDMs are expected to just get paid on commission. A lot of people say, how do you pay them? If you're expecting them to just get paid on commission, the challenge with that is you're basically expecting them to starve for the first onboarding period of the first 30, 60, 90 days if they're just purely commissioned.
You can have some sort of initial bonus structure that you're going to give them that they have to pay back maybe, but that puts them in the hole from the get-go and that can help them get over that hump initially. What I find is it doesn't make sense to pay people based on commission unless the commission payout is big. In real estate, it's pretty big for the amount of work that you do. That becomes really big.
You have a big payout so it's worth it to do all that work and stuff like that. In property management, commission is going to be smaller and if you're expecting the BDM to not just close, but you're expecting them to do the follow-up, the prospecting, the nurturing, and all this work, it doesn't get them paid on the front end. They only get paid when they close the deal. Then you're expecting them to just do all of this work that they don't get paid for when they really want to spend their time doing what they really get paid for.
You need to have a couple of options. If you're going to do commission only, my recommendation is they're just closers. That means you have lead generation, follow up, all that handled by somebody else. Or you bring them in and pay them a base that's based on them doing all of that follow-up, prospecting, and everything else based on that. Then there's a bonus or commissions structure, maybe a little less than if they are commission-only that's attached to the winning of a contract or getting on a client.
That is probably more ideal in most situations because then they're getting paid to do all of this work, to build up the sales pipeline, and then they do have that reward that they can get once they start getting business on and they're closing deals. That's going to be, generally in my opinion, a far more effective structure, is to have base plus salary.
Now how do you onboard them, how do you start them out, my recommendation is you take this BDM and you start them initially as a sales assistant. Just getting a sales assistant if you're currently the business owner and you're closing the deals, could double your close rate. It could double the amount of capacity that you have.
They're going to operate more like an appointment setter, then you're going to be the closer. Setter and closer allows you also to use an effective strategy that one of my mentors calls the double barrel close—which can be really effective—in which they comprise the closer, make them more important in the mind of the prospect, and help you increase the close rate. You're really going to love what Jason has to say once you get on a call with him. He'll be able to answer all the other questions, but first I need to make sure that you qualify to talk to Jason.
That's what a setter can do for you and it significantly increases your close rate, it increases your value in the mind of the prospect if they do that effectively and they can preframe some of these sales tactics; future pays, preframing, stuff like that.
Now, you start them as an appointment setter and that means they're just learning the CRM, they're doing all the follow up, they're helping you to schedule appointments, they're booking things on your Calendly, or whatever scheduling thing you do, then you can show up and close, close, close. It's going to increase your close rate. This helps them learn how the sales process works and they can eventually start shadowing you and listening in on those sales calls that they booked, being part of those, they can learn how you're doing it and they can get to the point where they then want to take those calls directly.
How do you motivate that? If they're a driven sales person and they like money, then the way that you do that is you're going to take your commission. My recommendation is you figure out a flat fee commission structure. Flat fee is generally better than a percentage for sales people, in my opinion, because it gives them something concrete. They know each door I get, I'm going to get X number of dollars.
Then you're going to take that commission structure and you're going to cut it in half maybe or even a third depending on how big that fee is going to be that you're going to pay them that commission. If you're going to pay them a half commission, for example, let's say you do 50%, they get 50% if they set and they get the other 50% if they close it.
If they're just setting, they will start out just getting a half commission. If they set them up really nicely and you're able to close the deal, then they get it. This gets them the incentive. Once they start to taste that and they get these commissions, if they are the right personality type to drip in, they like money, they're motivated by this, very quickly they will be pushing to get that second half of the commission.
What do I need to do to get that? What else do I have to learn? They're going to start asking questions. They're going to be very curious. You want them to be pulling to get more money from you and wanting to step into that. That shows that they're driven and they're the right personality type.
If you find that you're trying to push them into it and trying to move them along, hey, when are you going to be ready? It's been a few months now. You're ready to do the calls on your own? They're probably not the right personality type so maybe you didn't vet them correctly during the hiring process and looking at the DiSC profile, Myers Briggs, some of the things you might use to figure out if they're going to be the good fit naturally for this.
That's some of the stuff we chat on today's call with clients that are in my program. If you have questions about BDMs or things like that, join our program, happy to chat with you more or feel free to ask questions inside the DoorGrow Club. I'm sure a lot of people have experience in there at doorgrowclub.com about BDMs. In general, make sure they have the right personality type, make sure you are onboarding them correctly.
Now to point out, I had a client which I met today who fired a couple of his BDMs, but these were probably the first two he had hired. Usually, if a BDM isn't working out, most of the time it is because they weren't supported right. If you do all the vetting right, then the real challenge usually is because they weren't supported right. They didn't have scripts. They didn't have proven things that work. You weren't able to showcase that you knew how to do it and teach them how to close deals, be successful, deal with objections, and everything else.
They didn't really have a chance. They didn't have the right support plus the pay structure may not have been the way I described and may have not incentivized them correctly so they weren't really on boarded or supported correctly. That's what I've seen a lot of times with companies that go and hire a company to get them a BDM as the challenge.
Figure out how to do it, don't avoid it. It's something that once you get comfortable with that feels great, it doesn't feel uncomfortable anymore because once you start winning deals and getting on business, sales becomes fun.
Then you realize sales is not anything pushy. It's not anything unethical, whatever sort of mindsets you have around sales. Sales really is just about helping people see their problems accurately and then helping them see how you can help them. That's it. It's not about getting people to buy something they don't need or want. It's about getting them to buy the exact thing that they really need to help them solve their problem, and that's you. You're the solution to that.
Hopefully that's helpful. This will be a short episod today. Check out doorgrowclub.com if you want to join our Facebook free community and there are a lot of great property managers in there. They're willing to help out and answer questions.
If you want to take your business to the next level, start growing, start adding a lot of doors, having success, and you're ready to be challenged and take things to the next level, then reach out to us and we will give you access to a free training, my seven frameworks on how you can grow your property management business, and the things that are holding you back, why most companies suck in the industry, so that you are not the next sucky company, and you can be great too. Hopefully this is helpful, and until next time to our mutual growth, everyone. Bye, everybody.