Just as people tend to buy/sell homes infrequently, brokerages infrequently enter into a brokerage platform vendor contract, so familiarity with some key terms can be helpful. In that spirit, I wanted to point out some key terms of a real estate brokerage platform vendor contract, and what you, as a broker/owner, should be considering as you review the agreement provided by your brokerage platform vendor. In this, the first of a two-part series, I’ll discuss the following terms: term/duration, ownership of content and data, and customer support.
Term
The duration of your agreement can vary based on the type of product you’re using. If it’s an off-the-shelf, templated product with very little customization, shorter term agreements are often possible. Often, these can be month-to-month contracts, or a short-term contract, such as 12 months, but with an out clause of 30-60 days so you can exit the relationship.
For more custom projects, expect a longer term of three years or more. Vendors may seek longer terms, and brokerages often want the flexibility to switch should their needs change. In these cases, options to renew can be an effective middle ground, where a shorter term, such as three years, can have options to extend for two or more further years. Vendors can put dates when such options expire, encouraging customers to lock in pricing in exchange for longer terms.
Ownership
Whether you use a templated website, custom website, or simply a brokerage CRM solution, ownership comes up often. In many templated website solutions, and CRM-only technologies, you are licensing the technology from the vendor; you don’t own it. However, the data about your listings, customers, transactions and agents should be yours to use as you please. Any page content you create (about communities, blog posts, etc.) should also be owned by you as well. Brokerages should have the vendor’s support upon termination to get the brokerage’s data out of the vendor’s platform in an easy to reuse digital format, like a CSV file.
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In fully custom solutions, the custom website is built to your specifications, and you can negotiate to own it if you leave. If that custom website is built on a proprietary platform created and owned by the vendor, then even if you own it, you cannot install it anywhere else. Some custom solutions are built on top of popular content management systems, such as WordPress, so you can still use the custom theme (website) on another WordPress installation. Bottom line: Are you renting or buying your custom brokerage website? Be sure you know before signing the agreement.
Support
Whether your have one user or 1,000 users, I can guarantee your staff and agents will have questions about using the system. Your brokerage platform vendor contract should spell out the type of support channels provided (phone, email, chat, website, etc.), the availability of said support (weekdays, weekends, after hours) and the response times you can expect during the stated hours via the provided channels. You may also consider if the support is done by employees, independent contractors, and if they are domestic or overseas support agents. Other factors to consider include if the support is included in the stated pricing, or is it an additional cost? Are there tiers of support that cost extra? For example, email support may be free, but if you want phone support, it costs an additional fee per user, or monthly fee. Support is the “make it or break it” term of your vendor agreement that will most directly impact the success of this new platform with your agents, so be sure you understand what kind of support you’re getting and at what cost. Without support, it’s like buying a plant and never watering or feeding it.
Hopefully, if you’re considering a new brokerage platform vendor, you’re now better versed on the impact these terms will have on your brokerage. Next time, I’ll discuss what to watch for in terms for setup and monthly fees, and avoiding pain upon termination.
