OVER­COM­ING WAGE WOES IN THE

MOD­ERN AGENCY Mark En­gel­mann

Elite Property Manager - - Contents -

What is stop­ping your agency from achiev­ing growth, and not just sur­viv­ing but thriv­ing in the cur­rent mar­ket? Most peo­ple would say it’s cash.

Whether it’s grow­ing your peo­ple through train­ing and de­vel­op­ment, grow­ing your mar­ket though lead gen­er­a­tion and busi­ness de­vel­op­ment, or grow­ing up op­er­a­tionally by in­vest­ing in new tech­nol­ogy, it all takes time and costs money. So the spot­light of­ten re­turns to

ex­penses; specif­i­cally, a re­view of ‘fixed’ and ‘vari­able’ costs.

One of the biggest costs is no doubt go­ing to be labour.

The cost of labour is a killer, but prop­erty man­age­ment staff are es­sen­tial – and they can only man­age around 100 prop­er­ties each, right? Even if they could take on a few more, that only al­le­vi­ates things for a lit­tle while un­til you have to hire more staff to man­age the growth. We’ve heard this sce­nario time and time again.

There are four lev­ers you can use to man­age your labour costs:

1. Staff hourly rate

2. Em­ployee ben­e­fits

3. Staff pro­duc­tiv­ity

4. Process ef­fi­ciency

John Knight, Man­ag­ing Di­rec­tor at busi­nessDEPOT, says it is not un­com­mon for cost of labour in the PM busi­ness to sit around 50 per cent; how­ever, the best agen­cies are op­er­at­ing at around 37 per cent. At Beepo we have cus­tomers who, through the use of out­sourc­ing and cloud soft­ware, are achiev­ing re­sults of 25 per cent.

It all comes down to how many prop­er­ties each prop­erty man­ager can ser­vice. Ev­ery­one has a dif­fer­ent opin­ion on this, but gen­er­ally it seems most peo­ple would agree that it sits around 100 prop­er­ties per full­time prop­erty man­ager. But, with the right sup­port, they can man­age two or even three times this fig­ure.

We have many suc­cess­ful agen­cies us­ing out­sourc­ing as a lever to free up cash in their busi­ness to in­vest and grow. As I men­tioned, one of our agen­cies is op­er­at­ing a cost of labour at 25 per cent and their prop­erty man­agers are man­ag­ing 250 prop­er­ties each, with a fast-grow­ing rent roll.

How have they done that? Three broad ac­tiv­i­ties have been brought to­gether in an ef­fi­cient man­ner to achieve this re­sult.

Out­sourc­ing off­shore

By sup­ple­ment­ing your ex­ist­ing team with off­shore re­sources, you can cre­ate an en­vi­ron­ment that al­lows your lo­cal team to stop the process-driven work and fo­cus on what is im­por­tant to the busi­ness, such as busi­ness de­vel­op­ment and in­vestor wealth cre­ation.

Out­sourc­ing lo­cally

Out­sourc­ing in­spec­tions has its pros and cons; al­though it is a sim­ple process, it is also in­cred­i­bly time­con­sum­ing. How much time does your team spend on in­spec­tions? Some­one has to com­plete and is­sue the en­try no­tice, drive to the lo­ca­tion, spend enough time at the prop­erty to com­plete a thor­ough in­spec­tion, write the re­port and send it to the land­lord. Your prop­erty man­agers do not need to do this; hand it off to a spe­cial­ist or­gan­i­sa­tion to look af­ter it for them.

Cloud tech­nol­ogy

Au­to­ma­tion and ar­ti­fi­cial in­tel­li­gence are no longer sci­ence fic­tion. Tech­nol­ogy has come a long way; if you haven’t moved to the cloud yet, in­ves­ti­gate your op­tions and put the wheels in motion now. New soft­ware plat­forms have vary­ing de­grees of au­to­ma­tion and or ar­ti­fi­cial in­tel­li­gence built into them (or can be eas­ily in­te­grated), free­ing up your team’s time to fo­cus on the high-value tasks.

The ob­vi­ous ben­e­fit of run­ning at a lower cost of labour is a glow­ing bot­tom line – but that’s the short game. The in­dus­try is be­com­ing more and more com­pet­i­tive. New play­ers, new busi­ness mod­els and new tech­nol­ogy are cre­at­ing the per­fect en­vi­ron­ment for cus­tomers and a very com­pet­i­tive en­vi­ron­ment for busi­ness own­ers. The key for sur­vival is re­main­ing rel­e­vant and en­hanc­ing your value.

"IF YOU HAVEN'T MOVED TO THE CLOUD YET, IN­VES­TI­GATE YOUR OP­TIONS AND PUT THE WHEELS IN MOTION NOW." "THE OB­VI­OUS BEN­E­FIT OF RUN­NING AT A LOWER COST OF LABOUR IS A GLOW­ING BOT­TOM LINE – BUT THAT'S THE SHORT GAME."

Mark En­gel­mann is co-founder and Chief of Con­tent at Beepo. He has helped hun­dreds of com­pa­nies suc­cess­fully im­ple­ment an out­sourc­ing strat­egy in their busi­ness. For more in­for­ma­tion visit beepo.com.au.

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.