Geography matters as a broker

What that means is that brokers should be tactical about where they set up shop and what services they offer. As explained by Jason Back in a recent episode of Business Accelerator, this foresight can help keep brokerages maintain relevance.

“Being your local broker, looking around you, the state that you’re in, the suburbs, maybe three, four, five suburbs, that’s going to be the start for a lot of brokers. Whether they’re in a CBD location or they’re in the North Shore in Sydney or you’re down in Tassie, that’s going to help you understand what the market looks like,” said Back.

“So, is it full of SMEs and is it a corporate style environment? Have you got a lot of first home buyers? Land and construction? So, looking around you [and looking] at the natural landscape. What’s involved, who’s around? That’s probably going to be your starting market.”

Figuring out how the local community operates can help determine which services are crucial for that particular area. This can boost relevance and help with word of mouth, which is crucial for brokers.

“That will then help determine things like loan size. It will help also determine things like complexity because if you’re working with commercial and SME clients, they’re going to be very different from residential first home buyers. Obviously, we’d all love the biggest, largest, easiest loans to settle, maximising our efficiency. But that’s just not how the market works,” Back said.

“An average loan size down in Tassie can be low 200s. The average loan size in Sydney can be low millions. So, we have to then build a structure around that where I’ve got some Tassie brokers that write $20 million a month that I’ve worked with over the years who run amazing businesses. But $20 million a month and Tassie is hard work. You have to be super-efficient. You have to get your clients to be doing a lot of the heavy lifting.”

Broker numbers recently climbed to over 21,000 in Australia. With this figure on the rise, being smart about how you operate can help stand out from the crowd and maximise effectiveness.

The workforce has undergone immense change through the pandemic, with remote working becoming a more popular and far easier proposition. Brokers have the option to work this way, but without that immediacy in the local area, they may fall short.

The transcript of this podcast episode was slightly edited for publishing purposes. To listen to the full episode of Business Accelerator, click below.

Jack Campbell is the editor of Broker Daily. After graduating from the University of Wollongong in 2022, Jack began his journalistic career working on Broker Daily’s sister brand, HR Leader. In August 2023 he was made the news editor and worked alongside some talented journalists writing articles and recording podcasts.

To reach Jack, email him at: This email address is being protected from spambots. You need JavaScript enabled to view it.