Is Profit the Top Priority?
Each year, property management surveys conducted online show profit, efficiency, tenants, and growth are the 4 top goals of property managers.
Depending on the economy, one will rise to the number one position that year.
You’d be hard pressed to find any entrepreneur or property management startup manager who isn’t dreaming of growth.
Scaling up presents an extra set of challenges which some may not be prepared for. The risk of failure is there.
What resources, tools, and strategies will you need as you prepare to achieve your number one goal of growth?
Property management software will be a foundation for growth hacking, but much more systematic preparation is needed before can you decide to leave the status quo.
Enjoy this epic post with tips and insights along with our sincere hopes that you can grow your doors and profit in 2023 and beyond. With insights you’ll be better able to select a better digital solution.
Scaling Up Brings Additional Desirable Benefits
Scaling up to capture market share with new landlord clients, improve service, and maximize revenue from current customers too, may translate to business survival. It is a wise goal. More clients means less risk if you should lose a landlord.
Scaling up raises confidence too. It creates expectations you feel compelled to make work. It often forces you to streamline work and cut anything that’s proving unprofitable.
Scaling up gives you a chance to reorganize to deal with issues in staffing, work processes, service gaps, or clients.
Scaling up can mean you’re on the path to success.
Yet, scaling up a property management company is serious business. Some property managers make assumptions. For instance, survey’s show intent to scale up via landlord’s own growth. Yet they report also that most landlords don’t want to grow their portfolios. You have to take your fate into your own hands.
“Scaling a business means setting the stage to enable and support growth in your company. It means having the ability to grow without being hampered. It requires planning, some funding, and the right systems, staff, processes, technology, and partners” — from www.score.org/blog/how-scale-business.
To scale up, property managers will benefit from a strategy that addresses the demands of what will be the firm’s new status quo. Is growth a continuous, perpetual change, or will you just reach a new plateau? Humans tend to like plateaus for comfort and to work more efficiently.
As you pursue new accounts, the demands and risks rise. More properties means more potential threats or losses. Good risk management is part of any growth plan.
Scaling up can:
- expose your firm’s real capabilities and potential
- put pressure on maintenance technicians who might spend too much time on a service call/project
- increase exposure to tenant churn, lost rent, and turnover workloads
- require extra work to capture payment from new, unfamiliar renters
- require new service pricing models that may waffle in performance
- cause exposure to materials and construction/renovation delays
- significantly raise travel and service costs
- expose you to increased financing costs (rising interest rates)
- give you properties which have budget-eating hidden leaky roofs, structural and plumbing problems, safety issues
The first point is important. Scaling up will put everything to the test. Rather than being disappointed, why not develop a plan and use your 2023 results as a benchmark for real growth?
What Are You Really Providing to Landlords?
And as landlords run from the cost pressures, regulations, tenant management, and maintenance work, a grand opportunity to capture new business appears. And for those who think creatively, you can help landlords rework how they run their own business and how they can get value from you.
Scaling up then means finding and choosing productive landlord clients and quality properties you can service. So when managers say they want growth, it has to mean good portfolios you can manage efficiently.
Before planning a big change to your company, identify the key opportunities and risks of scaling up. Know the cost vs revenue equation. Understand in detail too, how your staffing, costs and risks are covered.
If you can cover all contingencies, you should be able to scale up considerably.
Advantages of Scaling Up
Scaling up forces you to do work more efficiently. This includes:
- not accepting rent payments and applications in your office
- not having the cost of a physical office
- automating accounting, data entry, applications, leasing, and rent payment because you can’t do it manually
- developing a virtual maintenance center
- routine processes which encourages staff and tenants to align with business efficiency
How to Scale Up Seriously
There are no quick steps to scaling your business. You’ll be experiencing the challenges non-sequentially. That will help you feel the weight of each. When you’re emotionally invested in each challenge, you’ll understand what’s actually needed.
JD and Mellissa of The Real Estate Jam discuss the nitty gritty of scaling a property management firm and dealing with the increased malarky some new landlords bring, with Janet Fields of Oaktrust Properties in South Carolina.
A list of key items to cover in your growth plan:
- develop a strong management and operations plan that will service all the new properties
- develop a new service package to charge higher prices (new digital services?)
- review your business model to ensure you’re focused on where revenues are highest
- review all manual processes that can be automated with property management software
- source for landlords who are underperforming and who need a new approach
- convince landlord prospects to adopt new business models with new innovative services
- outsource to contractors
- control risks by knowing what you can control, avoid or transfer (contractors, insurance, contract clauses)
- know your market risks, staffing risks, tenant risks, asset risks, and legal liabilities
- encourage landlords to innovate with new properties, and renovation/upgrades to raise rents and grow their revenues
- choose landlord owners with integrity
- choose landlord owners with houses, apartment buildings and other properties that fit your service capability and won’t present nasty surprises
- document your complete procedure to build service consistency and identify problems
- reduce routine and mundane tasks by automating everything you reasonably can — rent payment, accounting, leasing, reports, onboarding, marketing
- understand skills and licenses needed and new staff you may need to hire
- increase marketing budget to expose your brand to more landlords
- create a vetting process to decide on landlord client prospects you attract
- increase marketing to communicate you’re open to take over other company’s books (some landlords want out)
- access new media channels and services to capture new leads
- increase content marketing to give your branded services a marquis image (branding)
- communicate your value proposition and talent on your web site
- switch to a modern property management platform that will give you all the essential services for maximum efficiency
- empower your staff to use technology efficiency tools
Hiring a Property Management Consultant
You could also hire a property management consultant to provide advice. If hiring them is a one time cost, their ability to help you get organized and prepare for all demands is a wise choice. Even if you’re certified and well trained, that conversation could be vital to your future success. Your weaknesses and blind spots can be identified.
One thing a property management consultant may advise is to switch to a modern, SaaS, cloud powered property management software. You’ll need to improve your accounting, asset management, leasing, and onboarding.
That is not a software you will grow into, but one that is easy for your staff to learn and use now.
Software it is a key issue for managers who don’t want added complexity, training time, and staff stress. ManageCasa is manageable and versatile. Staff especially appreciate how pleasant using ManageCasa is.
ManageCasa has a reputation as an easy to use yet professional level solution
From accounting to lease management to tenant relations and maintenance management, you have the core essentials of property management well covered. Additional apps/services such as tenant screening and virtual showing/onboarding can be used as well. There are hundreds of useful property management apps you could add to your management and service repertoire. Use what you need when it’s necessary.
How Does ManageCasa Property Management Software helps you Scale Up?
There’s no better time to upscale your software platform than when scaling your business. Keep it simple but ensure you have a professional level management solution which includes the core functions of maintenance, payments and accounting.
Here’s what ManageCasa excels at:
- automates accounting, rent payment, recurring bill payments and more — the full benefits are better explained when you book your demo with our product specialists
- optimizes tenant communications to reduce misunderstandings and get the right maintenance and repairs done quickly
- helps you understand property performance for better financial planning
- optimizes and automates rental vacancy advertising to the right renter audience to ease your renter recruiting time crunch
- gives you an affordable software as a service leveraging the secure computing power of the AWS Cloud
- helps you automate and process renter applications, leases, and lease driven accounting processes
- provides owner and tenant portals to enable self-service which cuts inquiries and CSR time spent
- real time updates of all your rental units, their condition and ongoing maintenance schedules
Take a closer look at ManageCasa now.
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