Crain’s Chicago Business recently interviewed John Greene for his thoughts on the trend of real estate agents no longer joining corporate franchises.  John Greene founded his independent real estate company, john greene Realtor, in 1976.

Here is an excerpt from the article:

The best independents haven’t been afraid to borrow ideas from the chains. Naperville-based John Greene Realtor expanded aggressively a few years ago, with five offices and a luxurious 300 square feet of office space for each of its 135 agents. The owner, 65-year-old John Greene, noticed that franchise-driven rivals were getting by with closer to 60 square feet of offices per agent and spending more money on Internet marketing. He closed three offices, slashed his staff to less than 75 people and poured more than $100,000 into the development of a new Web site.

To read the entire article, click the following link or scroll down the page.  http://www.chicagobusiness.com/cgi-bin/mag/article.pl?articleId=33612.

Independent real estate agents skip trend to join corporate franchises

Virginia “Ginny” Sylvester meets clients at a corner table at her local Starbucks. Mark Allen favors a spare room in his rambling 150-year-old Victorian home in west suburban Batavia. Both real estate agents are holding onto their independence even as offices around them join corporate franchises — or go dark.

The residential marketplace has been in tatters for nearly three years now, and by one count almost a third of real-estate salespeople have left the moribund industry. But some top, experienced independents have shunned national franchise alliances and held onto their share of the market, working out of their homes and cars and continuing to make deals in emerging niches such as foreclosures.

It means the loss of training and advertising support that are the familiar trappings of the franchise organizations. But there are always clients who appreciate the local touch — or simply don’t notice either way.

Lora and Paul Kurilla had their four-bedroom colonial in St. Charles listed for a year with Baird & Warner, a large independent, with no results. They switched the listing early last year to Ms. Sylvester and sold the house in short order. The couple, both 47, were impressed by her hustle.

“Ginny brought in some of her own furniture as accent pieces to brighten up our home,” says Lora Kurilla, a hairstylist. “Before every showing, she’d arrive here early and make sure all our lights were on. If there was a dirty glass in the sink, she’d put it in the dishwasher. No other agent was doing that kind of thing for us.”

Agents with dedication can be found everywhere, of course. Franchise-affiliated closers do a lot of hand-holding, too. But some brokers prefer to redeploy their energy from corporate demands to clients.

“It doesn’t scare me not to know how much money I’ll be making this month, or whether I have a sales manager to hold my hand if the market turns bad,” says Ms. Sylvester, 50, with Stone Tower Properties in Geneva.

STAFFING UP

But even she advises novice sellers to join a franchise. They bring discipline and ready-made materials for marketing, advertising, recruiting and accountings.

Britta Rivera, the director of sales at Weichert Realtors Frankel & Giles in the South Loop, has built her office up since joining the Weichert franchise in January 2009. About half of the agents the firm has hired have been new to the business.

“The franchise provides a two-day fast-track learning program,” says Ms. Rivera, 40. “If this office were still independent, it would be very time consuming for me to try to duplicate that.”

Independents lead the marketplace, though franchises have been gaining. In 1995, according to Steve Murray, president of Real Trends Inc., a Castle Rock, Colo., consultancy, one out of every four real estate agents in the U.S. worked for a franchise organization. Today, of about 1 million agents in the nation, 401,000, or 40%, work for franchises.

The ratio is approximately the same in metro Chicago, Mr. Murray says.

“Some of the franchises have suffered losses in agents in the past year,” Mr. Murray says. “I expect that to change when the market recovers. They’ll start growing again and probably take more marketshare away from the independents.”

Mr. Allen, the Batavia agent with A. L. Allen & Sons, went independent after years affilated with Century 21.

“I was one man and enjoyed it immediately. I didn’t have to worry about the overhead associated with a big office and 30 desks, and I could do things for the first time the way I wanted,” says Mr. Allen, 60, who has since hired three sales people. He works out of his home or from the local Caribou Coffee, and these days few clients mind.

“Some people are impressed by big conference rooms and large ads in the paper each week,” he says. “But most don’t care at all.”

The best independents haven’t been afraid to borrow ideas from the chains. Naperville-based John Greene Realtor expanded aggressively a few years ago, with five offices and a luxurious 300 square feet of office space for each of its 135 agents. The owner, 65-year-old John Greene, noticed that franchise-driven rivals were getting by with closer to 60 square feet of offices per agent and spending more money on Internet marketing. He closed three offices, slashed his staff to less than 75 people and poured more than $100,000 into the development of a new Web site.

“We were so busy growing and selling when the market was good a few years ago that we neglected a few things,” Mr. Greene says. “A franchise organization might have educated me on some of these issues, like the trend to less office space, sooner. But we eventually figured these things out.”

THE GOLD BLAZER

Not all agents want to figure out such things for themselves. Marti Corcoran, 60, has been selling for Century 21 McMullen on Chicago’s Far Northwest Side for 15 years. Through most of the 1970s and ’80s, she worked for an unaffiliated brokerage and was a good producer.

But, she says, “I felt I could grow more.” The office wasn’t investing in technology and education, and Century 21 offered newer technology and fresh ideas.

A corporate identity meant instant credibility, too.

“I’d walk into a listing appointment and tell people I was with Century 21, and there was immediate recognition. I wore my gold blazer to the car wash and everybody knew who I worked for,” she says. “I was doing $3 million a year in sales at my old organization. At Century 21, I went on to have my best year, at $28 million.”

Some franchise offices, including hers, have recruited top talent by giving them a bigger cut of their commissions.

David Hanna, 55, a managing broker at the franchised Realty Executives Source One offices in Chicago and Hinsdale, got his start 15 years ago at a Century 21 office in Lakeview. He likes big organizations, where “you are armed with a bigger net to catch clients.”

On the other hand, he admits that a franchise can take an agent only so far. “A brand might get you in the door for an interview,” he says. “After that you’re on your own. You have to sell yourself.”