I sat down recently with Chris Hartley, Vice President of Sales for K. Hovnanian Homes. Never one to hold back, Chris shared his views on managing your sales teams during the market shift in the market we’re now experiencing. We had a lively discussion on the way leaders and new home sales professionals are missing opportunities—and what they need to do right now.
MB: What are some of the issues you’re seeing in the market now that the flood of homebuyers over the past two years has receded?
CH: About 70% of new home sales professionals are clueless about what to do now. They weren’t around in the last recession. They’ve never been in a rising cost and rising interest rate environment. And the sales leaders who were promoted in the last few years have no clue on how to lead them.
MB: Back when I began, I didn’t know what a bad market was. I thought it was darn good because I was making more money than ever before in my life. For others, it was bad because they were used to making money hand over fist. The market is all you’ve got—good, bad, or indifferent—so you work with it.
CH: As much as we, as team leaders, have hopes our teams are doing everything they‘re supposed to be doing and paying attention to training, the market took a sharp turn faster than anyone could have thought. What many had hoped for was that their teams were a lot stronger than they truly were. There are a lot of leaders out there shaking their heads, wondering where they went wrong with their teams. Ultimately, if you are not getting back to the basics now, you have some catching up to do!
MB: I’m working with a new sales manager who is hearing the team complain because it’s not as blistering hot as it was. But this is still an incredible market. The interest rates are incredible, They weren’t real before.
CH: Exactly! The best time to buy a house was yesterday. The second-best time is today. You can’t get caught up in “I could have”. We don’t have that luxury, but we do have the luxury of doing it today. If I buy today and rates go up, at least I get today’s rate. If rates stay the same, I’m no worse off. And if the interest rates go down, I refinance.
MB: It comes down to having the right belief system. It boggles me that people start off with, “It’s not going to work.” With that thought driving your actions, you’ve already quit before you started.
CH: I recently had a meeting with my team. I told them, “You are not doing what you’re supposed to be doing, not following up, not doing the habits that lead to success in a tough market.”
MB: And how did that go?
CH: They were nervous. We did role-playing and they tried to dodge it.
MB: They’re afraid of being exposed.
CH: They knew they were pretending, But I threw out a basketball analogy. Alvin Iverson used to say, “Practice? Why practice?” But Kobe Bryant and Michael Jordan spent more time practicing than playing because they knew it was practice that would prepare them for the game. You just can’t go out and expect to be your best without having practiced. This is what we do for a living. It’s what feeds our families and gives us our cars and our homes. What blows my mind is that what contributes most to our livability is what we spend the least time doing.
MB: Better is not what you wish for. Better is what you become. What do you want to become? And what are you actually becoming? Kobe and Michael wanted to be the best at their sport. Iverson is still wealthy, but I’m guessing most of it came from endorsement deals.
CH: I believe in the quote, “If it’s important to you, you’ll find a way. If it’s not, you’ll find an excuse.” I tell my salespeople, “If it’s important, stop coming up with excuses.” Our goal is to make them better but you can only lead your sales teams so far, until they demonstrate they want to become better. I think the biggest challenge today is knowing when to keep training and when you just need to cut bait.
MB: When a salesperson is not performing, it’s the sales manager who is not performing.
CH: I always loved having a new hire attached to me because I’d be on my best behavior, showing them what the industry could do for their life.
MB: I like to work with an inexperienced person, before the mindset has been established elsewhere. You give them the experience you want them to have, not what they bring with them.
CH: Those who are true sales professionals have been waiting for this time. It’s going to flush out the others.
MB: That’s certain.
CH: I’d love to be in a model right now. If a buyer walks in my door, they’ve decided to make their life better. Too many salespeople are looking at why people are NOT buying new homes, instead of why they are. If these people can’t sell homes at a 6% interest rate, they should get out of the industry.
MB: We’ve had downturns before. It’s cyclical, and to be expected. Imagine the salespeople in 1980 who sold homes at an 18.6% interest rate!
CH: I got into the industry in 2003. I was a sales manager in Phoenix in 2010, where I saw the worst of the worst. I actually made more money during the recession than any other time in my life. I had the right mindset. I still believe that people are going to buy homes no matter what the market is.
CH: Whether you have a script or a plan, you still have to take your buyer through all the stages before they buy a house. If you don’t, you’re leaving something out. You leave room for them to back out. You have to know the basics to guide people from A to B. Buyers come in far more educated than they’ve ever been, but there still needs to be a process to follow. If you’re skipping steps, you’re not giving your customers the benefit of the education.
MB: And if they don’t believe in the value of sales training, they don’t understand the importance of having and following a process. So, Chris, what do we do? How do we deliver the training they need?
CH: What gets in the way of effective training and progress is their ego and, ultimately, their lack of belief in themselves.
MB: A person who doesn’t want to learn is ruining your training and your team. When it comes down to ego, I tell them, “Take your E and just go!”
CH: Mind if I borrow that line?
MB: Go for it. I’m hearing from a lot of builders who are recognizing that their teams need to get sharper, that they’ve been riding on the hot market for so long that their passion and skills have fallen to the wayside.
CH: What we do as an industry matters. Every day, we have the opportunity to make lives better. How awesome is having this ability to impact lives the way we do? We need to not take it for granted.
MB: And that’s why we are so privileged to be in this business.
CH: We need to focus on putting and keeping the right people in the right seats.
MB: That’s the challenge and the goal.
Stay tuned for my conversation on coaching with Chris and K. Hovnanian Homes’ Area Sales Manager in DFW, Meredith Chapman.