Should you sell or scale your appraisal firm?
I asked Larry Page and Sergey Brin’s Google a question about the industry I love, commercial appraising. Here’s what I got back: “Every year, for the past eight years, the number of active real estate appraisers has declined. The Appraisal Institute estimates that the number of appraisal professionals is currently shrinking at 3% a year and warns that sharper declines may be on the horizon as appraisers begin retiring en masse.”
Retire en masse? Does that include you? If so, what’s your business valuation, succession plan and exit strategy?
Super high cap rate for your firm?
If you been doing everything right, you probably have a strong business valuation. However, for most appraisers chronically stuck in tactical work, there’s a lot of work yet to be done. Shift gears and focus on a strategic vision to create a culture with documented processes that’s sellable. If 100% of the value of your firm = you, then we have a problem Houston.
Paint the picture for your people
You need to sit down with your people and explain where you’re going. Begin with the end in mind. Clearly define the outcome. Clearly define what success looks like. Define the finish line.
There’s an evolution in a journey you need to go through. Reach out to a group of peers that are in the same boat as you. They don’t have to be just appraisers, but professionals nearing the end of their career that are still energized. Avoid the tired “kick the can” down the road attitude. Seek out the motivated.
- Develop a high touch client culture
- Have in-place senior management that acts like the owner
- Create documented playbooks spelling out repeatable processes
- Fix haphazard technology with consistently implemented software
- Establish a collaborative work environment with ongoing initiatives
You’re competing with national firms
A current review of the Canadian Property Evaluation magazine shows Avison Young, JLL, Colliers and CBRE all looking to hire. Their ads mention words like, “enjoy workplace flexibility”, “collaborative environment”, “supportive teammates” and “leveraging superior technology.” If you’re looking for an exit strategy, you might look to JLL’s marketing, “Reimagine your future.”
The end is the beginning
You may decide that you don’t want to sell your company, but do the opposite, SCALE. You as Appraisal Owner 2.0 might seek out new lines of business you’ve never done. Evals are a lucrative product if done with technology and process. Seems odd, but you might be reinvigorated bringing in new talent to help you smoosh the gas pedal down and hire and train a bunch of young professionals.
Dial-in your daily habits
Create your perfect day, your perfect week. Then have a laser focus on each pillar of your goals. You might be seriously energized by this new entrepreneurial attitude. Ask your peers what they’re up to. Have a couple of espressos with them. You might find that there’s a shared journey.
Work yourself out of a job
Is it too late? No not at all. Just create a plan and work the plan. Create a success manager that can facilitate a roadmap for you. Have patience, it’ll take time. Especially if you have employees that have been with you a long time. It’s like the container ship stuck in the Suez Canal, it takes a lot of effort and energy to get unstuck.
We can help
DataComp Suite provides the important basics, comp management, report writing and appraisal workflow. At RealWired, we know it’s really not about software. It’s successful documented processes and implementation. We also understand you’re busy. So, if you’re ready to exit or scale, we would love to get the conversation started.
We can talk about how to have an effective exit strategy if that’s your plan. We can help you scale your appraisal business. Whichever direction you want to go. It will take effort, it will take discussions, it will take change on your part. Give us a call and let us know how we can help you get there. Wouldn’t it feel great not to be stuck?