September 13, 2013 — I may not be the brightest bulb in the marquee and I don’t care to remember how many times I’ve been wretchedly mistaken in life – so you’ll understand why it seems to have taken me so long to adjust to the idea that there are ‘some’ developers and management in this new era who could care less about hiring the crème de la crème of sales talent in our industry. Now remember – I said ‘some’ developers.
So Here’s The Scoop: For those fairly new to the timeshare industry who are in sales you need to understand that I first started my journey in Timeshare Land decades ago and ‘back in the day’ if you were a top producer – and by that I mean being a low maintenance (no issues) Pro with verifiable STATS 2 to 3+ times the industry norm – you were clamored after by other developers/management and offered all sorts of perks to come on over to the other side, so to speak.
For example, there was a “ride on the room” being offered whereby a Pro would be paid – along with their very special commission and spiff structure – a fractional percentage (e.g. 1/4 point) on the room (sales center) each month from all net business. It was a nice little cushion for those ‘dry’ spells when even a Pro will blank and have no personal commission check coming in on any given payday.
There were also those times when airline tickets – once in a while 1st class ones – were provided to get the Pro to fly to that ‘other side’. Or a relocation allowance/reimbursement, or housing of the fully furnished variety (sometimes for as long as you stayed at your new home) was provided free of charge.
And those type of perks just covered being a super duper closer or F/B’er (front to backer). Proven sales & marketing management often fared even better, especially if they had a team that would follow them.
The notion back then was that developers HAD to ‘make bank’ on all sales; or to put that another way, selling the product required the developer being profitable – post haste in order to survive – which is also why back then getting new buyers to cash out in a nano-second often warranted an additional juicy huge all cash spiff being paid out to the Pros, usually the next morning.
From a sales reps perspective this all started changing many years ago. And from what I’ve been told by a developer this week it is because, in part, the real money for developers changed over time and was no longer dependent on just selling the product, no longer on just hypothecating the ‘paper’ – and though ‘cash-outs’ are appreciated, that, too, is no longer part of the overall game plan for ‘some’ developers.
In this era, I was also told, it is an immense money type ‘game’ (my word) of the Wall Street variety. Exotic (my word) investing-funding, if you will, profits from debt, etc. – and that there is a colossal amount of funding available for new start-up projects, buyouts/consolidations and marketing entities, too, and that in many cases making money on the actual product (just selling TS’s) is a secondary thought and really doesn’t matter at all.
These new mega-money players apparently have been and are more than willing to toss in up to hundreds of millions of dollars into a ‘real deal’ as long as it’s managed properly, etc. and “…if you don’t lose money on sales or just break even that’s fine”. And even if you do lose money, as long as it’s not too much of a loss and not for too long a time that’s okay, too!
What I was also told is that unlike days long since passed in the once upfront cash-intensive timeshare ‘biz’, the long term game plan and sole focus by ‘some’ well funded developers and their mega-money brokers, investors, backers is basically the future ROI (return on investment) over the course of decades.
That said, ROI is generated from the usual suspects such as: Escalating for profit annual maintenance fees, principal interest payments, special assessments, internal exchange fees, the selling of additional use points to existing owners/members, upgrades from (e.g.) low cost EOY plans, trial-deals to ‘larger’ plans as well as long term rental income generated from both owners/members and the general public from sold and unsold inventory.
Lastly, I was told, this is why, in part, these money brokers and ‘some’ developers are as happy as pigs in you know what with what I professionally call dismal, intolerable and unacceptably low closing ratios, VPG, etc. And yet their glee holds – I am told – with those embarrassingly low stats even with marketing and sales costs at the 60% level!
As such my issue – being I’m “old-school’ and yet in sync with most other industries in this new era – is that if the (e.g.) closing percentage by the ‘sales staff’ is say 15 – 20% then by God we’re going to move mountains to kick it up a notch or two. And then when we get ‘there’ and that level becomes the new norm – we’ll again move mountains and kick it up another notch.
Tweak – improve – increased sales – profits – lower costs, etc. – That’s my policy!
Yet today in our industry that sort of logic, goal and business objective by ‘some’ developers apparently is not relevant and the mere suggestion of ideas to accomplish just that could be grounds for a good whipping out behind the barn. And then that person would be sent packing down the road – likely with a less-than-stellar reference.
You may have noticed when I referred to these types of developers I used the word ‘some’ at least four (5) times and I did so because thankfully there are also other developers in our industry who still reward their Top Guns and are always interested in hiring Pros with the bona fides to join the team. You’ll find ‘some’ of those developers advertising right here ‘Inside The Gate’ (ITG).
As for those other developers that this week’s rants is about? If you are one of the truly few super sales star reps-closers in our industry you might want to deflate the ‘chest’ a little when looking for a new opportunity elsewhere, because it seems ‘some’ developers could, sadly, care less how good you are as they have an odd rationale these days and, IMO, top producers need not apply.
Good Luck Out There!
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Contributing sometimes extravagant, bombastic, emotional, pompous or even pretentious writings about the timeshare industry, Scoop covers an array of industry related subjects each week including inside information, tips, scandals, interviews, forecasts as well as new (good or bad) products and services--- and, of course, all the 'Good', the 'Bad' and the 'Ugly'.
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