Essential Magazine April 2014

Page 48

THE FOCUS business

HOW TO GROW

in a recession

Engel & Völkers has been posting impressive growth figures right through the financial crisis. We spoke to one of the company principals, Pierce Broderick, to find out how they’ve achieved expansion in a recession. WORDS MICHEL CRUZ PHOTOGRAPHY COURTESY OF ENGEL & VÖLKERS

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ormally the onset of a major recession marks the point at which companies begin to batten down the hatches and downscale, but for Engel & Völkers the past five years have been among the best in the company’s history. At a time when businesses were closing and foreign real estate firms were leaving the beleaguered Spanish market en masse, Engel & Völkers not only reaffirmed its commitment to the country but actually expanded its geographical and numerical presence. The number of iconic E&V shops grew steadily, reaching a current total of 75 across Spain, with another ten scheduled to open in 2014. “We foresee strong continued growth in Spain and internationally in the coming years,” says Pierce Broderick, Business Development Director for the group. “Let’s face it, if you can expand during the worst years of the recession, then it is reasonable to expect further growth when economic conditions are improving.” He backs these statements up with figures: last year alone saw an increase of 48.5 per cent in turnover for the group’s Spanish arm, resulting in €435 million worth of transactions. “The best results came from Marbella, where Smadar Kahana’s shop on the Golden Mile, the top performing E&V shop in Spain, posted a 100 per cent increase in turnover with an average value of €1.7 million per property

sold. Figures like these indicate that we are ahead of the curve and that our model is a successful one.”

THE SECRET OF SUCCESS Asked how the group achieves such impressive results at a time when we’re only just emerging out of recession, Pierce admits that there is no simple formula for success. “The so-called secret of success is a shadowy and flighty thing. It requires keeping your finger on the pulse, understanding changes and new trends, and being flexible enough to adapt to them and incorporate them in your business culture. However, the growth we have enjoyed so far is built on the core value our brand emits, and that’s security.” As a group specialised in the mid to upper segment of the market, Engel & Völkers is by definition a brand dedicated to service and associated with style and professionalism. However, its success in expanding its network of shops in Spain in the period between 2007 and 2012 stems from the confidence its shop owners have in a company that has the professional corporate culture, resources and commitment to proper conduct that gives it a competitive advantage over autonomous localised businesses. “Ours is indeed a corporate group that acts accordingly, investing not only in marketing but also in training, presentational standards, technical

know-how and maintaining correct professional conduct. We don’t say to our new staff members ‘go out and sell a house’. Instead we submit them to initial and ongoing training courses aimed not only at gaining a better understanding of the market, legal procedures and property-related technicalities, but also to develop a feeling for what a client is looking for.” The group’s academy is lead by top international consultants headhunted specifically for this purpose, with the aim of ensuring that the same standards are maintained regardless of whether you step into a shop in Marbella, Mallorca, Hamburg, Sydney or São Paulo. “It is this, together with corporate responsibility, that makes us stand out and provides a sense of security,” says Pierce. “By corporate responsibility, I mean the fact that at Engel & Völkers people are answerable for their professional conduct in a way that is not visible among the small, independent agents.”

AN INTERNATIONAL NETWORK Another factor that gives shop owners, vendors and even buyers added confidence is the knowledge that each shop is connected to a global network of 4,700 Engel & Völkers agents in 38 countries on all five continents. “This is a huge and very important international network that brings homes and buyers together but also links local knowledge with a truly

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