Real Estate Agents in Australia March 2012 19
Cost Structure Benchmarks continued
Sector vs. Industry Costs Average costs of all industries in sector (2011-12)
Industry costs (2011-12)
■ Profit ■ wages ■ Purchases ■ depreciation ■ utilities ■ rent ■ Other
Percentage of revenue
0 SOURCE: WWW.IBISWORLD.COM.AU
Basis of Competition Level & Trend ompetition C
in this industry is High and the trend is Steady
The level of competition in the Real Estate Agents industry is mainly based on the sale and management of properties (e.g. residential, retail, office, industrial and rural). To obtain a competitive advantage in the industry, agents use a range of strategies to ensure their probability of success. One strategy real estate agents use to gain a competitive advantage is effective advertisement. It is through advertising in magazines, newspapers, TV and websites that prospective tenants and home owners are able to find properties they are interested in buying or renting. Advertising is particularly important when trying to attract interest from potential interstate-based and overseas-based investors. Multinational companies and developers are increasingly seeking to form relationships with major global real estate agencies to provide real estate leasing and facilities management services.
The industry is a sales-based industry and therefore requires employees with strong selling skills. Close attention needs to be paid to factors such as developing a referral base, managing clients, shop or office fit-out and layout, and sales staff selection, training, monitoring and motivation. Some agencies may turn away potential customers who do not fit their market niche (e.g. concentration on prestige or high-value properties). Where sales commissions are deregulated, competition is also based on price. Sales commissions on commercial properties have been deregulated in all states. Victoria, Tasmania, the Northern Territory, New South Wales and South Australia have deregulated fees on residential properties. Queensland has not deregulated residential fees. Western Australia has plans to deregulate fees.