Join Date: Nov 2012
Location: SOUTH/SOUTH EAST/ COASTAL OUTER BANKS
Thanked 470 Times in 244 Posts
The regional business model was born during the Foreclosure boom/bust in the late 2000's, volume was the only thing keeping it alive during those times.
Now that the volume has slowed down which in turn has caused profits to all but evaporate, the business model it was based on has changed, which intern has caused prices to drop on services rendered. This was inevitable.
Lets look at the side effects of a leveling out of foreclosures, buczek, ASAP, CPR, Homestar, these are just a few that are falling are have fallen. Those that are popping up now are hoping that what once worked yrs ago will still work today,Not going to happen, let take SEAS for an example, they are constantly looking for people running adds always, never ending adds, eastern states is a another one, PKMT, the list goes on.
Social media has changed the way people and company's interact, the one thing regional's and nationals have yet learned to deal with. I'm in 3 states and have been called a regional myself, but im not. I have a vary close group of contractors that works for me and other company's and a i pay vary well. Very simple model and it works and i have the ability to change as needed to make it work.
Take notice that as the economy improves some what the pool of contractors decrees, putting even more pressure on the over all profits.
Regional's are doomed to fail.
The best advice is to go local stay local, dominate your area, know your area and diversify.Large National Company's gravitate toward owners more so than the company itself.( if you know what i mean)
Its just not our industry that is moving toward a localized business model, it the the whole economy that is moving toward a localization of services.
The national heath care law is just one example, one size never fits all, causes more problems that it fixes. it to is on its death bed, those in Washington just don't know it yet. Just like regional's don't know it yet, their always the last to know.
My EO carrier which i just spoke to last week said that EO claims are threw the roof. The main cause of the spike is cheap labor, hack work, CL adds, trying to save a buck.
Money is like water flowing down hill it always thats the path of least resistance, EO claims and hack work is considered resistance.