Thursday, April 2, 2009

Your most profitable poor cousin - Property Management

Times are tough in real estate and suddenely many principals are starting to pay attention to a part of their business they normally have no interest in what so ever.

There are a number of rent rolls of sale in Australia and a common reason is because the business has not paid the ATO, GST/BAS, cash flow is tight or they are closing down.

Property Management is your bankable cash flow. It is the part of your business that in today's market will, if you run it well and it is profitable, sustain your business and get you through these tough times.

It is also your superannuation, too often I hear agents comparing the commissions earnt on a sales v property management transaction. Please keep in mind that when you come to sell your business it is valued on your recurring income that being your management fees.

Training is the first thing that we stop investing in as businesses and employees however consider an athlete going to run their toughest race, will they kick back, relax and wind down or will they train harder, do their research and get match fit to win the race.

We are corporate athletes however we dont seem to have the same level of committment to success. We act like ostricthes at times like this, if I stick my head in the sand for long enough when I come up it will all be okay.

An important reminder to all directors is that many of your competitors will have in place:

• a business plan and a budget based on percentage, dollars and numbers
• a prospecting plan – they will not just depend on business that walks in the door
• a marketing plan - they know exactly where their business is coming from
• a SWOT (strengths, weakness, opportunities and threats) analysis on their business but also on yours
• a competitor analysis – they will have a copy of your listing kit, your fee schedule, they will know what your key points of differences are and they will have developed the right scripts and dialogue to use against you
• a database that is up to date and used to market to existing and potential clients
• sales training for property managers who are listing business
• a separate profit center for property management

Now is the time to act on the above and implement these into your business to ensure survival and success.