Dexters is fusing digital strategy with a traditional approach to deliver strong profits
Since 2017, like a prophet in the wilderness, my day job has been as a consultant to a large number of proptech and fintech founders. I’ve been doing my bit to convince real estate operators that the right type of digital transformation can add huge profits.
Dexters, it would now appear, are very much the industry’s case study, having just reported over a 30% uptick in its latest profits. With a gross profit of around £40 million on a £143 million turnover.
For any agency to digitally leverage its profit base, the business needs to be fundamentally a great business to start with, and Dexters was and is such a business. It was efficient and had a great brand with lots of key staff in situ for many years, running flagship offices.
Then, after seeing an opportunity, it enhanced its market position by selectively executing a people and tech strategy, which meant it could deal with more business. Yes, it has been on an acquisition trail buying up agency businesses, but it also bought market share and digital strength by buying Howsy, an app-based lettings platform, and the assets of Rentify.
There is no quick route to having a real estate business that delivers profits, it takes investment and total focused attention from the teams that run the branches.
But what is becoming clear is that there appears to be a two-tier league table opening up, where forward-thinking and forward-planning businesses who selectively embrace and invest in the right technology are squeezing out every last profit, whilst other agencies cling to their old models of business.
There is no quick route to having a real estate business that delivers profits, it takes investment and total focused attention from the teams that run the branches.Andrew Stanton
Though it wasn’t quite London, where Dexters and its other agencies under other brands operate, I was in a medium-sized town yesterday, with a population of about 170,000. Having not been there since the start of the pandemic, I noticed a large new agency perched at the top of the high street. As I walked around, I saw that a number of very established agency businesses had gone.
Over lunch, as I spoke with an old friend who is still very much in the property business, I learned that the new agent had acquired the other businesses and was now a very dominant player in lettings there. I said they could do this as the agency was using property technology to create the huge efficiencies that can be pushed into the lettings business.
Yes, it was still very much a people business, but a team of six in the new agency was dealing with the same workload that twenty staff across four former businesses were, whose owners thought excel sheets and a top-heavy human approach was a great way to run a business.
Pre-pandemic, perhaps. In 2030…definitely not.
Industry experts come together for The Guild’s new podcast series
On Wednesday, 15 June, The Guild of Property Professionals launches its new podcast series named The Home Stretch. Hosted by The Guild’s CEO, Iain McKenzie, co-hosted by Holly Hibbett, from the Network’s PR and Social Media team, the podcast will feature interviews with various industry experts talking about a variety of topics that have either a direct or indirect impact on the market and the property industry.
In the pilot episode, McKenzie sits down with property market analyst and CEO of Twindig, Anthony Codling, to discuss his views on the property market and what the historical data is telling us we can expect. “As a guest speaker at The Guild conference earlier this year, Anthony presented some very interesting data around house prices and the correlation between aspects such as inflation and transactional housing statistics. Given the current influences that are taking their toll on the economy, we wanted to invite Anthony onto the podcast as our first guest to discuss what he predicts will happen over the next while based on numbers,” says McKenzie.
He adds that upcoming episodes include a discussion between The Guild’s Compliance guru, Paul Offley and James Munro, Head of the National Trading Standards Estate and Letting Agency Team (NTSELAT). During this episode the two discuss why the decision was made to make the changes surrounding the disclosure of material information. There is also an episode with outspoken industry controvert, Russel Quirk, discussing his solutions to the problems estate agents have with conveyancers and how the relationship can be improved, amongst other topics.
“The podcast is a great platform for The Guild to be able to engage with industry experts and discuss a number of topics that we think property professionals will find interesting. It is also an opportunity for us to discuss what we are passionate about, which is the property market and the people that work within the industry. We want the podcast to be as helpful and educational as it is engaging for our audience, opening up some interesting avenues of discussion with experts in their field,” says McKenzie.
He notes that new episodes of The Home Stretch will be released every Wednesday. To listen to the first episode entitled ‘Do interest rates drive the housing market?’ click on the either of the links below:
Andrew Stanton is the founder of Proptech-PR, a consultancy for Founders of Proptechs looking to grow and exit, using his influence from decades of industry experience. Separately he is a consultant to some of the biggest names in global real estate, advising on sales and acquisitions, market positioning, and operations. He is also the founder of Proptech-X Proptech & Property News, where his insights, connections and detailed analysis and commentary on proptech and real estate are second to none.