While it was interesting to read that Countrywide-one of the industry big hitters-had plunged deeply into the red last year resulting in far-reaching cuts countrywide (no pun intended); it was something else that drew my attention. The announcement hidden among the “review of their footprint across the UK”, don’t you just love corporate-speak? (translated here as ‘we’re $%^*&*’) was that it has scrapped its digital offering. The associated job losses are nothing to mock (as shown by the level of vitriolic indignation and blatant contempt for the Countrywide executive on various internet forums), but it does focus attention on something that we have blogged about before. It is the belief of this bald (but still devilishly debonair-form an orderly queue ladies) estate agent of some score years and more, that you are either an estate agent or an online agent. If you are the former than you need to use to maximum effect all that modern technology offers and if you are the latter, then you dispense with the service traditionally offered by an estate agent. What isn’t advisable is to try and ride two horses in the same race. Countrywide decided that they would offer a digital online presence to compete with the likes of Purplebricks and the fellow residents of the internet stable block. Adopting the characteristic endemic to the breed, they chose to charge up-front and then if the property fails to sell, the vendor has the option of switching to the the “traditional method” whereby the already paid up-front fee is deducted from the standard fee when the property is sold. That seems like a good deal, but of course the standard fee is around 2%. Let us have a quick look at the numbers. You as the vendor pay £1000 up front to sell your £200,000 home. It fails to shift, so you switch to no sale, no fee at 2%. The house sells so the fee owed is £4,000 less the £1,000 already paid, leaving a net £3,000. However, if you are a seller who has paid the £1,000 and end up disappointed at the lack of success and lack of service, how would you feel when the company assures that there is nothing to worry about, but how about trying the traditional service at 2%? Are you going to look about the market place for another ‘traditional agent’ who may charge 1% or less? The result in money terms may be the same, but the initial expense with no result other than putting your hand back into your pocket, may well have put you off.
It seems though that some things-despite all the phenomenal technological advances made-never change: it is always someone else’s fault. Countrywide’s chairman Peter Long offered, “The under-performance of our business over the last three years has resulted in us making significant management change in the group” (interpret that as ‘You’re fired, but I’m alright Jack). The accompanying report rips apart the efforts of the previous management and the retail model that it adopted, including, “our foray into digital”. Hmmm, who oversaw the previous management, okay-ed the directives introduced and undoubtedly broke bread with them at various corporate get togethers? One final question that will only mean anything to those old enough to remember when I wasn’t bald and Agent Corbyn was rattling around East Germany on a scooter with the Big D; did somebody mention The Halifax and its spectacular implosion after a retail model was introduced that was built on quicksand, resulting in a mass exodus and those left saying, ‘it wasn’t my idea’?