November 11, 2023In this episode, Nick McLean interviews Sammie Knight, a business powerhouse and broker/owner of five ReMax Experts offices. Sammie shares his 30 years of experience in sales and marketing, emphasizing relationship-building and continuous learning. He discusses his “4 P’s for Business Success” and imparts timeless wisdom for achieving financial success in business and life. Viewers gain valuable insights from Sammie’s journey into real estate and his strategic approach to business.
Video Contents:
00:00 – Introduction
01:26 – Sammie’s Background
10:59 – Building Relationship & Being a “Sponge”
20:53 – Sammie’s Recipe for Success (the 4 P’s)
34:00 – Profiting & Frugality
Episode breakdown: planning, waste and the four P’s of running a brokerage
Sammie Knight owns five RE/MAX offices, a property management company and a mortgage company. He came to real estate from sales, sourcing and manufacturing, and he bought his first agency almost by accident after a land deal. In this episode he walks Nick McLean through the simple operating rules he has carried from business to business.
Ask new agents whether this is an opportunity, a job or a career
When a newly licensed agent joins one of his offices, Sammie starts with two questions. What are they trying to get out of this? And do they see real estate as an opportunity, a job or a career? An opportunity usually means some extra money on the side. A job, in his words, is not going to be fun. If the answer is career, he commits to teaching them how to make it something they never leave.
He accepts that some of those agents will eventually leave him. If he trained them right, they leave as contributors to the industry, and he counts that as a gain rather than a loss. Nick added that agents who left his own team went on to open gyms and other local businesses, and he still sees that as part of the job of developing people.
Run the business on four P’s
Once an agent is serious, Sammie moves to what he calls the four P’s: planning, process, persistence and profit. The one he leans on hardest is planning. In his view, the agents who fail are the ones who never plan, never stay persistent with the plan, and never learn the processes needed to deliver it. He is also open about profit. He wants every vendor he works with to make money too, and he will sit down with one who says the margins aren’t working.
Sammie describes himself as someone who lives five years out front. When he started, the goal was 20 agents. Once he could see that was going to happen, he went back to the plan and asked what processes and expenses it would take to reach 40 and stay profitable. He adjusts the path every year but keeps working the same plan.
Fix the plan in flight instead of starting over
Nick, a former airline pilot, compared a business plan to a flight plan. Pilots adjust in midair, but the destination doesn’t change. Sammie agreed and pointed to the mistake he sees most often. People hit a roadblock, stop, and start over with a new idea. He goes in with a plan A, may use a plan B for a while, and always returns to plan A.
I’m a guy that believes in fix it on the fly so I never stop my plan.
Sammie Knight
Nick called the alternative a treadmill of starting over. He sees the same pattern in coaching, where a team leader copies someone else’s system, skips their own adjustments, and then decides it didn’t work.
Split the general ledger between owner and staff
Sammie’s test for any expense is simple. Tell him how much that dollar put to the bottom line. If you can’t classify a cost as an investment in the business, he treats it as waste.
If you have an expense that you cannot say as an investment in your company, that is called waste. Get rid of your waste.
Sammie Knight
To keep that manageable, he divides the general ledger. The owner watches the top 10 and the bottom 10 expense accounts, and everything in the middle belongs to someone else on the team. The top 10 is where bad decisions cost the most. The bottom 10 is where money slips out the back door without anyone doing anything wrong.
His example came from the first office he bought in Memphis. The supply room held about 250 rolls of toilet paper, roughly a year and a half’s inventory, because it was easier to buy in bulk than to check what was on the shelf. The office now buys for a month. The point wasn’t the toilet paper. It was the capital tied up on a shelf that could have been invested elsewhere, and the culture of detail he wants around spending.
He applies the same split to income. The top accounts get a hard look at whether they are actually profitable. The bottom accounts are the people just starting to believe in you, and he sees the most upside in nurturing them well.
Keep emotion out of people and vendor decisions
Sammie believes running a business stays simple until emotion gets into it. He gave two examples. A leader keeps a struggling hire too long out of sympathy, then handles the exit badly. Or a team stays with the same copier vendor when the one down the street has a better product, because they watched the owner’s kids grow up.
Make the decision for business based on the facts and based on the company’s benefit.
Sammie Knight
He still values loyalty. He just keeps it in friendship and keeps profitability in business.
Key takeaways for team leaders
- Ask every new agent whether real estate is an opportunity, a job or a career, and invest heaviest in the ones who say career.
- Write the plan before the next growth target. Decide what processes and expenses it takes to get there and still be profitable.
- When something breaks, adjust the plan in flight. Don’t throw it out for a new idea.
- Own the top 10 and bottom 10 expense lines yourself, and give someone else the middle.
- If you can’t call a cost an investment, cut it.
- Make hiring, firing and vendor calls on facts and company benefit, not on how long you’ve known someone.
