Considering benefits/issues of agents working under RE license

[Chris Clark]

I'm interested in learning about associated expenses, taxes and insurance needed if I engage with new agents and allow them to use my RE broker's license in California.  I'm just a sole proprietor at this point, so any advice on the best entity would he helpful as well.  Finally, how do you determine an appropriate split for agents?  Based on experience?  Or tiered based on volume?  Curious to hear from members the are RE brokers with agents working under them.

Thanks-

Chris

[Bruce Lynn]

@Chris Clark My thought is you need to call directly to all the providers you plan to engage for the services you plan to provide to your agents. So you would want to call your E&O insurance providers, showingtime or showing service vendors, CRM vendors, training vendors, lead generation vendors, compliance officer,sign vendors, print vendors, etc. Add up the cost of those services, think about your overhead for office space and calculate how many agents you need to be profitable. Then think if that is doable. It has been 20 years or so, but when I worked at Prudential I would ask why didn't we open an office here or there....and they would always say they needed a team leader from another broker to agree to join and bring a minimum of 35 agents with them. That was the start to pay for an office, an accounting type person, and staff the front desk. Probably to be decently profitable we really needed 50 to 100 agents, so 35 was just the minimum to start an office.

An alternative for you if you think you are or could be a great recruiter is to join a brokerage like Keller Williams, which will allow you to run your business inside of theirs.   You recruit and train and coach and develop agents and they take care of all of the stuff above.  You focus on what you're good at...recruiting...and leave all the pesky details to someone else.   You get profit sharing, and potentially some referral fees.  You get the benefits and someone else handles the pesky details that waste your time and don't make you any money.