1. East Coast Competitive Review January 2014

2. 5 year agreements ($25K-$40K franchise fee)
- Regional Fee: $160/month
- Ad Fund: $110/month
- Some franchisees have a Brokerage fee that varies (I.e. 1%)
International Ad fund: $300 US yearly/agent on Anniversary.
- 3-month royalty holiday for new recruits
- Seniors don’t pay any IA/Regional fees but pay a transaction fee of $300.

3. Sample Compensation plan
Split: 95/5
Royalty Fees:
$ /month Regional Fee
$110/month Ad Fee
$300 U.S./year IA Fee
Brokerage Fees:
$35/ month Tech Fee
$450/month Management Fee OR
$295/transaction Transaction Fee
$400/month Shared Office Fee

4. Re/Max stated Value Proposition:
Over 90,000 agents provide RE/MAX a global reach.
global.remax.com: 70 countries in over 30 languages
Canada’s leading real estate organization with over 18,500 agents in over 700 offices.
Out-produce competing brands three to one based on 2011 stats.
#1 in over 150 markets in Canada
More agents with specialized designations than any other brand.   
Advertising drives traffic to our listings through online, television and outdoor advertising
Curbside Marketing Program: SMS numbers and QR codes
Miracle Home Program® and Sold on A Cure  

5. Questions asked by Re/Max recruiters?
1. Do agents typically receive high commission splits?
2. How many offices in your network?
3. Does your office or network and its agents have a history of surviving "down markets”?
4. Are agents typically able to negotiate commission rates with clients?
5. Do referrals in your network travel directly from agent to agent?
6. Are you supported by a national advertising campaign?
7. Do you have access to on-demand video real estate sales training?
8. How well-known are your company name and logo?
9. Does your office or network provide professional designation courses?

6. www.joinremax.ca 10. Do you have a commercial/investment division?
Questions asked by Re/Max recruiters?
10. Do you have a commercial/investment division?
11. How do per-agent transaction sides compare with the industry average?
12. How many countries are in your sales network?
13. Do you have a luxury-home sales program with distinctive signage and branding?
14. Do you have free access to online on-demand real estate sales training 24/7?
15. Do you have free access to professionally designed templates you can customize online to create brochures, virtual tours, Web ads and other marketing materials?
16. Do you have an annual international convention that provides networking opportunities with thousands of your colleagues, plus unmatched educational opportunities?
17. Has your network displayed strong growth?

7. Competitor Focus
What are their strategic advantages in your local markets?
How do you compete directly against them?

8. Royalty Fee: 6% GCI capped at $3000/annually.
- Typical brokerage splits: 70/30, 80/20* and 90/10** capped at approx. $20 000/year.
Transaction fees: $100 after brokerage capping
+ monthly office fee ($300-$600) + monthly marketing/admin fee ($55-85)
*Previous GCI for 2 years must be > $100,000 and brokerage cap must be guaranteed.
**Previous GCI for 2 years must be > $200,000 and brokerage cap must be guaranteed.

9. About Keller Williams Realty:
Keller Williams Realty, Inc. is the largest real estate franchise company in North America, with approximately 700 offices and 93,000 associates in more than a dozen countries around the world. The company has grown exponentially since the opening of the first Keller Williams Realty office in 1983, and continues to cultivate an agent-centric, education-based, technology-driven culture that rewards associates as stakeholders. The company also provides specialized agents in luxury homes and commercial real estate properties.

10. Residuals made easy… 1. Calculation of Market Center Profit:
Gross Commission Income (GCI) $150,000 (-) 70% Agent Split $105,000 (=) Company Dollar $ 45,000 (-) KW Approved Costs $ 22,500 (=) KW M.C. Profit (or Loss) $ 22,500
2. Creation of Monthly Profit Share Pool:
Profit Share Pool Owner Profit Level 1 (first $2,990) 25% $ % $2, Level 2 (next $8,250) 35% $2, % $5, Level 3 (above $11,240) 50% $5, % $5, $9, $13,235.00
The formula for distributing profits based on the agents each agent recruited to the company, the productivity of those agents, and the cash profits generated by each market center.

11. Residuals made easy… 3. Contribution to Profit Share by Agent:
Agent Total % of Company $ Company $ Profit Share John contributed $3,886 out of total $45, = 8.64%
Total Profit Contribution to Share Pool Profit Share That % X $9, = $800
4. Distribution of Profit Share to Agent’s Upline (KW Team Members Who Recruited the Agent):
1st Level Sponsor Mary gets 50% $400 2nd Level Sponsor Tom gets 10% $80 3rd Level Sponsor Joe gets 5% $40 4th Level Sponsor Nancy gets 5% $40 5th Level Sponsor Jane gets 7.5% $60 6th Level Sponsor Mike gets 10% $80 7th Level Sponsor Carol gets 12.5% $100
100% $800
The formula for distributing profits based on the agents each agent recruited to the company, the productivity of those agents, and the cash profits generated by each market center.

12. Competitor Focus
What are their strategic advantages in your local markets?
How do you compete directly against them?

13. Royalty fees:
$295/year paid by everyone including non licensed and retired agents.
$ /transaction capped at 18 transactions or $2700/year.
10% of each agent’s GCI capped at $10,000/year.
Brokerage fees:
70/30 split to $100,000 and 90/10 thereafter.
Processing/Sponsoring fee of $45 is charged per residual cheque.

14. Their model
Residuals at EXIT operate as a single level system and can be paid out in 3 ways:
Sponsorship Bonus: 10% of the sponsored agent’s gross commissions up to $10,000 per year.*
Retirement Bonus: 7% of the gross commissions of each sponsored agent, up to $7,000 per year.*
Beneficiary Bonus: 5% of the gross commissions of each sponsored agent, up to $5,000 annually.**
*Sponsored agent MUST be working full time at EXIT and generating business.
** An additional administration fee of $35/transaction is added to Beneficiary Bonus
Note: Agents MUST generate 8 sales transactions or $40,000 (not including leases or referrals) annually to qualify for the 10% referring residual. If this is not met then agent considered retired for referring purposes and receives 7% not 10%.