This quote below is from Seth Godin... I thought it was appropriate.

My take on pricing is that I do NOT create an hourly schedule for my consulting clients. I meet them, evaluate what is needed/asked for, and then tell that client my fee for the service. It is based on my past experience of how long it will take me to complete / how hard it is / how much hassle .... etc. It is not a formula. It is my gut instinct and that is it. I don't print a schedule in writing. If the client doesn't want to accept my fee then either we negotiate or he goes elsewhere. That would be considered "market pricing" -- If the fee is not "worth it" in the client's mind, then they won't pay. I rarely ever have anyone walk away. 

I think you all will find this post very interesting and I hope our voices will be heard loud and clear in support of the retainer. Please comment.

"You don't get paid for the hour. You get paid for the value you bring to the hour."

https://www.brainyquote.com/quotes/quotes/j/jimrohn109882.html

I am disappointed in the fact that I have scoured this site and can learn nothing about creating a contract. Being in California I would ideally like to find at least one of the 409 ACRE© graduates that does business here that would share the contract they use when a client decides to use their service. I am not one that will go off half-cocked and offer this type of service until I have things in place and a contract seems to be a necessity so I am sure most ACRE's© have one.

WOULD YOU PLEASE SHARE?

Why do people become Realtors? Would most of you agree, that the prime reason is to "make money" ? Yes, I know there are other reasons too, like "I want to help people" or "I get to be my own boss". Oh sure, there are many other reasons. So then, what kind of money does the average Realtor make? Are most Realtors today, in the "RED", just making ends meet, or truly in the "BLACK", financially speaking?

Last month, there was a fascinating discussion in the post Discounts, Rebates, Allowances and More. In that thread, Merv made a comment that I fear got lost in the shuffle and needs to be amplified:

"What if our industry NEVER was commissioned based? Erase it from your mind. Maybe there is a bit more service to be provided on the higher priced property, maybe not. Lets say the services are the same. If you apply the fee for service model to both price points are we being paid fairly for our services in either case?"

One of the most common "push backs" regarding activity based pricing from practitioners is something along the lines of "Well, with a commission, I'd get paid $12k and with fees, I'll only be paid $6k. I'm not leaving $6k on the table..."

To this I could respond in a variety of ways:

• IF the transaction closed
• IF the client didn't walk away
• IF I were putting in the same number of hours (NOT!)
• IF I were blond, blue eyed and 20 pounds lighter...

The Business Practice course is now a required course segment and the associated Workbook is now updated with some minor organization changes and examples of calculating prices on example tasks. The new Workbook can be accessed in the Library under Course Books and is linked here for reference:

Strategy, Rates & Fees Workbook September 2011

It is also available in your account under Business Practice (OPEN MY WORKBOOK).

The exam has two additional questions (total of 12) added as of today.

Please note that this uploaded spreadsheet is a SAMPLE form for use by all members and must be formatted and adopted for your own in your marketplace. By law, fees are negotiable and cannot be set or fixed among brokers.

Fee Schedule Rev 8.11.xls Flexible Fee Schedule available in Library Archive Catagory: Rates, Fees & Commissions.

How many times have we taken a listing at a great (or not so great) commission rate, spent many hours getting the listing set up, taking classy pictures, adding a virtual tour, getting the sign, lock box and fancy color brochures and running repeating ads in the local print media only to have a listing sit on the market too long because the seller is reluctant to get competitive on price, becomes impatient and then fires us and finds another agent? Yuk. All that expense (including your time) with absolutely no return. What really ticks me off is when the seller lists with the next agent at a price we were telling them to lower to in the first place!

Risk:

• In the standard commission model the agent is taking all the risk.
• If we were to be paid on time and materials, the client takes all the risk
• Sharing risk - here's an alternative approach I used to get paid for what I do and at the same time share some risk with the seller:

This is a new post on these important issues and how they relate to alternative business models. There were many great comments off subject on the recent Ambassador Program Brainstorming Session Announcement which I will attempt to collect and move to here. To do this I have to manually modify the data base (literally) that supports the Exchange. This will be a time consuming process but, the comments are valuable enough to attempt to do this. It will take a while.

In the mean time, if you have thoughts on these subjects comment on this post.