The Property Management Show

If you are thinking about starting your own property management company, or looking to improve processes and organization, you will need effective property management fee structures in place so you can continue running your business that’s fair to you and your clients. Having a pricing structure for your property management company will not only help you understand the cost of running your business, but it will also help you plan ahead and make sure that each rental property is handled professionally and with consistency. Our special guest today is a property management coach – literally. She’s Kathleen Richards, “The Property Management Coach” and she provides guidance to other property management company owners on topics like this to help them to be successful with their business. She is also the broker/owner of an award-winning property management company in Santa Cruz, California – Portola Property Management (Update: Since this article was published, Kathleen has sold Portola Property Management). We felt that someone with her pedigree would be perfect to talk about setting an effective pricing structure for property management companies. The Different Pricing Structures for Property Management Companies If you’re a new company starting out, and you’re growing your business organically, (versus buying a property management company that might already have a pricing structure in place) look around and see what your competitors are doing. Figure out how you can differentiate yourself. Here are some of the common pricing structures that property management companies use: Flat-Fee Pricing Structure Sometimes property management companies charge a flat-fee, and for new property managers that may be a great way to go. You can build your business quickly that way; just make sure you don’t over-commit to all the things that will fall under that set price, otherwise you’ll be doing a lot of work for free. A fixed property management fee is easy for a property owner to understand when hiring a property manager. Percentage of the Monthly Rent Another common type of property management fee is to charge a percentage of the monthly rent of the rental property. To help decide what will be a good range, research what other local property management companies charge, and maybe charge a percentage at the low end or below that. That way you’ll get people’s attention and be more competitive. Hybrid Then there are hybrids where you charge a percentage as a monthly management fee, and then you have other value-added services with set prices. That way, you only charge extra when the rental property owner needs that service. Examples of add on services may include tenant placement fee, early termination fee, and/or a lease renewal fee. It all depends on how much your property management company charges for the initial fee, and the exact services rental property owners in your location want. If You’re Buying an Existing Property Management Company If you’re buying a property management company with an existing price structure, but the prices are lower than you’d like to charge, you have to make changes strategically. Maybe you maintain those prices at first, so the existing clients can see how great you are. Then, you educate them about what you do differently, and roll out new services or start increasing prices gradually. Changing Property Management Fees: Kathleen’s Story When Kathleen bought Portola Property Management 15 years ago, the pricing model was a single price with everything included. After a year, she communicated clearly what the property management fee really covered, and what it didn’t, and started charging separate fees for uncovered value-added services. That allowed different revenue streams to develop. Then, after a time, she offered a Classic/Deluxe/Premium pricing model. The effectiveness of these models depends on your market. In a metropolitan area like in Silicon Valley, it’s great, because people are more likely to go for Premium. They are busy and they don’t want to deal with property management. However, for residential property managers in a smaller market, people may be more price-conscious. Kathleen found that clients kept choosing the Basic price structure. As different services get requested, they would just pay for them as needed. However, it wasn’t very economical for her to have three different monthly fee options when everyone chose the same option. Property Management Pricing Structure in Smaller Markets Kathleen revamped her pricing setup fee structure once again to increase the property management fees. She raised her standard price to what used to be the premium level, and included some of the services most people had been paying for as a value-add. This new fee structure has made things simpler on her end. For example, there was an option for rental property owners to receive a preventative maintenance check on all their properties. Kathleen had allowed owners to opt-in or out, but that caused her a lot of logistical problems. So she decided that everyone would have that service in the new, consolidated pricing structure. It’s included as a “freebie” and helps validate her higher management fee. However, there are still less requested services that owners pay for on a per service basis. Strategies to Encourage Upsells from Property Management Clients Kathleen’s strategy at Portola Property Management works if you are able to educate clients about your different property management services. Portola sends out quarterly newsletters about their new services. Your clients will gladly pay for new property management services, if you build up their trust in you by educating them about different issues that your property management company can help them solve. Also, great property managers “keep their antennas up” for any new services where there might be a demand. New Service Example for Property Managers One example that Kathleen and Portola identified has to do with pets. Santa Cruz has many pet owners, but a lot of property owners didn’t want to allow pets in their buildings. Kathleen felt that this created an opportunity, because there was a high demand for pet-friendly rentals with very few properties available. It would allow her to reduce vacancy time and increase the amount of rent she can get for a property. So they developed a pet program that has been a huge success: before a tenant is approved to have a pet in the rental property, Portola meets the pet to make sure the pet’s breed and size are what the tenant claims it is, and makes sure the pet has a good temperament. Then, extra money is collected towards the security deposit and two pet inspections are done per year, paid for by the tenants. When owners know Portola is inspecting the rental property twice a year and the owner doesn’t have to pay for it, they are more willing to rent to tenants with pets. Kathleen knows her residents love it too, because they are showing what a great job they are doing in taking care of the rental property. She can charge a higher rent for the property being open to pets, and Portola represents higher end properties where affluent pet owners want to live. They don’t want to be forced to live in a dump where owners don’t care about fixing things. Think outside the box. Before saying you don’t do something, think about whether it may be worthwhile for you to offer it to all of your owners. Concluding Thoughts on Property Management Fees Property management fees can be tricky to manage, especially when there are clients with different preferences and needs. In the end, a well-rounded fee structure that is tailored to the needs of the market is essential for success. Kathleen’s story shows us how to create the right fee structure and how to communicate it effectively to clients. By educating clients on the different services available and offering additional services to add value, property managers can upsell and increase their fees over time. It is also important to think outside of the box and create services that will meet the needs of the market. Doing so can help property managers to maximize their profits. Whether you choose a flat fee, a percentage of the monthly rent, or a hybrid strategy, we hope that you now have a better understanding of the different options for property management companies. Where to Find Out More If you liked our blog today, there is a good chance that you’ll like our other episodes on The Property Management Show. Be sure to rate and subscribe via iTunes, and if you’d like to get in touch with Kathleen, you can find her at ThePropertyManagementCoach.com. Thank you for joining us, and if you need help with sales or marketing for property management companies, please contact us at Fourandhalf – Digital Marketing for Property Managers. Recommended Follow-Up Articles For Owners Looking to Start a Property Management Company: Starting a Property Management Company: Company Structure How to Protect Your Property Management Business Online 5 Best Cities to Start a Property Management Company in 2017 Property Management Fee Maximization with Darren Hunter PhoneThis field is for validation purposes and should be left unchanged.First Name(Required)Last Name(Required)Email(Required) Phone(Required)Company NameComments or QuestionsThis field is hidden when viewing the formDate MM slash DD slash YYYY The post Starting a Property Management Company: Pricing Structure appeared first on Fourandhalf Marketing Agency for Property Managers.

Property management guru Kathleen Richards discusses strategic pricing approaches, tiered pricing strategies, challenges of pet owners, and value-added services in property management.

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The topic today is how to compensate a salesperson for your property management company. If we have a chance, we’ll talk about when you should hire that salesperson and shed some light on how to find and interview and retain the best salespeople for your property management shop. Our guest is Duke Dodson who runs Dodson Property Management. He has one of the fastest growing property management companies in the U.S., and he’s uniquely positioned to talk about this. Q: Thanks for joining us, Duke. Tell us a little about your company and your story. When did you first decide to hire a salesperson? How far along were you in your growth trajectory? A: I started my property management company in 2007. It was just me, so I was the business development person and the salesperson. When I got to the point that we had 300 units under management, I hired the first salesperson. Q: Do you mind if I stop you and ask how long it took to get to 300? A: It took about three years. I decided to hire someone because I was a good salesperson but not a great one, and I was doing business development and sales 10 to 20 percent of the time during the day. I knew if I could find someone to do it better than me full-time, I would grow. I was averaging 100 units a year when it was just me, and then when I brought in a salesperson, that growth went to 300-plus units a year. Q: There is something to be said about setting up systems to be able to accept this kind of growth. For most property managers, growing by 10 properties a month is a good goal. So 300 a year is a great launching pad. I don’t know of any information in NARPM or the general property management industry that talks about sales compensation. So how did you come up with a strategy? A: There was no roadmap early on, so I had to make it up. I looked at the type of person I wanted in the role and then I had to figure out the compensation model that person would be comfortable with. It’s rare to find someone with property management experience and sales experience. So unless you’re going to poach this person from another company, it’s going to be difficult for a property manager to find a salesperson with experience in single family management. I looked at other salespeople I might want to attract. Pharmaceutical and medical sales seemed the way to go because these are high energy, results-driven professionals. So I looked at those models. Some had a small salary plus commission and others worked solely on commission. I liked those models. So with our first salesperson, I provided a straight commission and no salary. I built it so that if he did well in the first year, then his compensation would increase in the second, third and fourth years, so it would be hard to walk away. He could earn a great income if he performed. Q: So you used a recurring compensation plan. He got to eat a bit of what he killed over time and each account brought him a percentage. A: Right, if he brought in a single family home for us to manage, he earned 25 percent of all the revenue associated with that property for one year. Then if he retained the property under our management in year 2 and 3, he’d continue to earn 15 percent. In year four, the commission would drop off. Q: That’s a lot of money. A: I learned that the industry standard was similar to that, and I also learned that you get what you pay for. If you want that top notch rainmaker, they will need to make a good living and you’ll have to compensate appropriately. But you may not need a rainmaker. If you’re getting a lot of warm leads from SEO and content, you don’t necessarily need a rainmaker, you need someone with good sales structure and organizational skills who can do presentations. That person doesn’t need to make $150,000 a year. You’ll find a good salesperson who can earn $60,000 or $80,000 a year. If you’re paying high rainmaker numbers, make sure they are bringing in a lot of business. Q: So for a younger company, it made sense to pay your salesperson a full commission of 25 percent of the annual contract value (ACV), for each property. And initially, you had a bit of a continuation plan that dropped commission but kept them interested in staying with your company. My worry is that you don’t want your salespeople to get fat and lazy. You want them sharp. How do you do that? A: Now we are on our second business development person and we’re using a completely different compensation model. It’s partial salary and partial commission. There’s a one-time commission when they source something. So there’s no danger of becoming fat and lazy. The way you prevent that is by hiring someone who isn’t prone to that. You want someone who will always push and stay hungry. If they get that way, change the compensation model or find someone new. This model we’re using now is much simpler. They get a salary and a certain number of dollars to bring in new business. Q: How many salespeople do you have? A: Just one now. Our first salesperson was here for five years, and now we have a new guy. Q: What do you think is the realistic capacity for a good business development person? How many properties can they realistically bring in per month? A: We have a good SEO presence, so we get a lot of warm leads. But for our salesperson, our goal is 25 properties per month or 300 per year. In the winter it slows a little and in the summer business picks back up. When we get a big client who has 10 or 20 properties, the numbers will obviously spike. Our salesperson is on track to meet those goals this year. We build our capacity so we can handle that new client that has 20, 30 or even 100 units. So if you have that capacity, your goals can be pretty lofty. If you don’t have the capacity, 10 properties a month is pretty good. Q: So capacity of one salesperson to perform and have enough time to follow up and develop relationships can be 25 properties a month, working full time? A: Yes. That’s not an issue. Q: Let me present something that one of my good friends implemented in his business. It has been successful. What do you think about this compensation plan – it’s a business that needs 10 properties per month. There’s an average rental rate, it’s not like California rates. There’s a base salary of $28,000. I think paying a base to a person solidifies your commitment to them and theirs to you. So with a $28,000 base, there’s also a 7 percent ACV payout on every lead. So the salesperson receives 7 percent of the annual contract value. The annual contract is 12 months of management fees plus the lease up. Most property management companies calculate the annual contract value at $1,700. Depending on the market, that’s in the ballpark. So at a 7 percent payout on 10 properties per month, that’s about $1,200 in commissions and about $2,350 for a base. The salesperson is in charge of their own destiny. If they want to stay at 10 properties, great. If they build relationships and go to 20, they double their compensation. I also recommend accelerators. So if they get to 15 leads closed, the next five leads go up to a 10 percent commission payout. That really helps them over-achieve and it compensates them for the busy season because they have to work more. The amount has to be adjusted for the market. Here in California, our average rent is $3,200, so that $1,700 annual contract value needs to be adjusted. It’s a flexible model based on where you are. What do you think of this approach? A: It’s not too dissimilar to what our salesperson is currently doing. We pay a $40,000 yearly base and $125 per new property. So if you do the math, it’s not too different from what you’re suggesting. The accelerator is a benefit. A lot of businesses do it and it really rewards the rock stars. But it can get complex. Any time you add complexity, you have the potential to mess things up. There will need to be a lot of organization administratively and with your accounting department. So if you can handle the accelerator payout and you’re not arguing over details every month, it can work. Every market is different, so you have to build a compensation plan that meets the need. If you’re in a market and $60,000 will get the job done and $60,000 is what you offer, you’re in a good position to find an excellent salesperson. When we hired our commission-only salesperson, it was shortly after the recession. The job market was horrible. Now, the labor market is pretty tough and there are more options for employment. I probably would not be able to hire someone without a base right now. Everyone prefers a base salary than the no-salary and all commission model. The exception to this rule is the real rainmakers, but that’s not who we’re talking about. Q: I like the dollar amounts for simplicity. Who does your business development person report to? A: It used to be me, but now it’s our director of single family management. Q: When you look back at your journey to get to 300 properties; when you were at 200 or 150, knowing what you know now, at what point would you have hired the salesperson? A: It depends on three things: how important is growth to you; what is your risk tolerance; and, how many warm leads are coming in the door. If you don’t need to grow and some growth is coming in the door on its own and your staff is managing fine, you’re probably less in a position to hire than if you really want to grow. Hiring is a risk. You’ll be paying someone a salary who might not bring in any business at all. I hired at 300 units because it felt right. If anything, I would have done it sooner because the growth rate was so incredible and I have a high-risk tolerance and leads were coming in the door. Q: That is similar to our journey at Fourandhalf. For the first three years, I was the only salesperson because I felt I could represent the company best. After about two and a half years, I started having issues with missed opportunities. So in retrospect, if I wasn’t a salesperson by nature, I probably would have hired someone sooner. It was hard for me to give up the control of the customer experience. I wanted people to feel taken care of when they called Fourandhalf. But by year three I couldn’t handle it all, and I built a professional sales team. Now we have a team of four; three salespeople and a customer success manager who is in charge of renewals and upsells within the company. Have you found any opportunities for you to upsell to your existing customer base? Are there any new services you’re introducing? A: Hiring the salesperson does free you up to think bigger picture and create opportunities for upsells. Obviously, a lot of property managers add real estate sales divisions and bring on Realtors. We do offer some upsells, but our business development guy has his head down closing business. Eventually, we’ll have him build a team that includes marketing new opportunities and ideas. Q: Unit economics are also important to understand. Under the model I proposed, if you acquire 10 new clients per month, the customer acquisition cost, which is the amount you spend to acquire that customer in marketing and sales, is about $500. So when your marketing budget is $1,500 a month and you pay your salesperson to bring in the business, you’re paying $500 on a customer with a lifetime value of around $5,100. That’s less than 10 percent and it is great math. So if this works out, I’d put as much money as possible into this program. Having said that, we all base this stuff on annual contract value, which takes a year to collect. So you need good retention, good people, and you have to keep your customers. Have you figured out how long an average customer stays with you? A: We lose about seven percent of our single family clients every year. Usually, those customers move to the sales market, or they go somewhere else or in some cases we mess something up or there is a foreclosure. We don’t have a good measure for an average lifespan. We’re only eight years old so I only have a few years of data. My guess is three to five years is our average customer. Q: Let’s talk about how to find that right salesperson. I have found a lot of success going to the bank. At the bank, I have talked to personal bankers or even someone in a junior role, and they make great salespeople. Banks have aggressive sales goals, and they employ smart people but they don’t pay them much. Two of our best people came from that background. What has been your experience? A: Customer service people and those who work in existing sales are great. Our first salesperson came from medical sales and the person we have now came up through the property management field, but had good people skills. I think personal bankers have a lot of experience with outbound marketing, and you can find a lot of good salespeople who have crappy sales jobs. You want someone who can close business and develop a sales process. Many times, the process isn’t here, and you need to create the sales process. You’re either going to have to teach the property management side or the sales side. It’s hard to find a person with experience in both. Q: We found that it’s hard to get salespeople with digital marketing experience. We’re so unique that we need to get them 60 days of training before unleashing them on the world. That’s an investment we’re willing to make. I don’t necessarily want them to have marketing knowledge and experience because what they know is probably wrong or not what we practice. Retail and banking are great places to poach. A lot of property managers tell me no one responds to their ads for a salesperson. The ad is usually very bad. When we look for a salesperson, we really sell our company. I recommend that property managers who don’t have time to put together breathtaking ads simply write up a quick job description and take business cards out to their favorite shops and poach someone. People working hourly rates can be great. So a little bit of walking around will deliver results. At Fourandhalf, we have a blog that often addresses the sales process, and we also have a book called The Art of the Sale for Property Managers. It spells out the sales process or the basic steps that need to be followed. LeadSimple.com also has a sales course. So once you hire that salesperson, just expose them to all the information you have, and then test them. Do you have any parting words of wisdom? A: We talked about this, but before you hire a salesperson, make sure you have your ducks in a row. You don’t want to spend all this money getting new business in the door only for it to go right out the door. So make sure you’re ready for the extra work. Also, really think about what values and culture your organization has because this person will be the face of your company. Figure out what you want. Do you want the more affordable person who processes warm leads or do you want a person to go out and get new business on their own? Those are two different price points and sets of results. This was helpful. Thanks for joining us, Duke. And if you need help with sales or marketing for property management companies, please contact us at Fourandhalf. Thank you for listening, and we’ll see you next time. The post Duke Dodson on Compensating a Salesperson in Property Management appeared first on Fourandhalf Marketing Agency for Property Managers.

This “Las Vegas vs. Memphis” interview is the first episode of our “Investment Property Showdown” sub-series within the Property Management Show podcast umbrella. This also serves as the 7th episode of The Property Management Show — the very first podcast dedicated to the property management industry and its success. Key Takeaways: When investing in real estate, location and down payment are key factors to consider. It is important to research the local market and understand the best strategies for success. A down payment of 20-25% is recommended. In Memphis, the median home price is just shy of $150,000, and investors can leverage up to 50% of the purchase price. In Las Vegas, the median home price is in the $212,000 to $215,000 range. It is important to find the right partner in a property management company and treat the investment as a business. Douglas and George are two great resources for investing in Memphis and Las Vegas, respectively. When investing in either city, it is important to monitor the property and make sure the property manager is doing the job that the investor wants them to do. Chapter 1: Investing in rental properties: Las Vegas vs Memphis. – Alex hosts Investment Property Showdown to discuss which area is best for investment property: Las Vegas or Memphis – Douglas explains Memphis’ economic stability, growth & rent to price ratio; George mentions Las Vegas’ low prices & potential business growth – Douglas & George explain minimum down payment & median home price in Las Vegas. Chapter 2: Real Estate Investing Strategies. – Real estate investing can be profitable, but understanding the market and best strategies is key. – Median home price in Memphis is $150,000, leverage up to 50% of purchase price for higher return. – Appreciation rate in suburbs is 3-5%, Las Vegas varies by zip code. Henderson is expensive to buy/renovate. – Research local market to make informed decisions and maximize ROI. Chapter 3: Investing in Property. – Location and down payment are key factors when investing in property; single-family homes in the range of $200,000-$250,000 are recommended. – Avoid homes in homeowner’s associations; 20-25% down payment is recommended. – Property manager should be hired; formula for Memphis success includes investing in older homes for $50,000 with zero-25% down and expecting $800 in rent. Chapter 4: Investing in Las Vegas and Memphis. – Las Vegas and Memphis offer great opportunities for real estate investments, but research and interviews are needed to find the right property management company. – Las Vegas houses rent for a minimum of $1200/month, while Memphis houses rent for $800/month. – Douglas and George can help investors find properties in their respective cities. The post Where to Buy Real Estate: Las Vegas v. Memphis – Investment Property Showdown appeared first on Fourandhalf Marketing Agency for Property Managers.

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The topic today is understanding the process of joining a property management franchise when you’re starting your property management business. We have two guests who are the perfect people to speak on the subject. Randall Henderson, the Director of Training for Property Management, Inc., and, the person who needs no introduction if you’ve heard of NARPM: Brian Birdy. He’s joining us today as Vice President of Residential Management for PMI. They’re going to give us an introduction to their company and talk about what sets them up as experts in the franchise field. Randall: Property Management, Inc. has been around for about seven years. We’ve had explosive growth recently, and in the last couple of years we’ve added 60-plus franchisees. What differentiates PMI in the industry is that we offer a wide variety of property management types. Not only do we do residential management, but also commercial and association management. The residential piece is still our primary focus, but we have added more pieces for our property management franchises. The franchise world is growing in the property management industry because starting a business from scratch is a challenging and scary thing. So these new business owners who come in are nervous and they want some systems in place. They want to work with people who have been there and understand the industry. They want someone who can provide value on technology. I came to PMI after running different real estate companies. I’m a broker and that’s what led me to a place where I can help train and teach new entrepreneurs. Brian: One of the things about franchising is you do have someone physically there ready to train you. That’s one of the things Randall has successfully established. He has put together an extensive training program which gives our franchisees so much more than what I had when I started there. NARPM is a valuable organization and we recommend that everyone join it and participate, but it isn’t there to take you on a moment by moment tour of the industry. PMI gives our franchisees a significant training that never ends. It’s formulated and includes weekly activities forever. You always have an opportunity to learn something new to grow your business. I have 20 years of experience with a property management company, and I’m a national instructor with NARPM. This year, the interest level in franchising and specifically in PMI is at its highest that anyone has ever seen. We have a team that can support that, so the momentum is exciting. Q: Property management has truly grown in prominence as a recurring revenue business. It also has the potential for complementary business units like real estate sales and maintenance, which increases the lifetime value of a customer. With that, here’s my first question. What does a franchise really solve for a potential entrepreneur who wants to start a property management company? Who should consider a franchise? What’s the profile of a person who should consider your franchise? Brian: It’s right for the person who is willing to recognize that you are building and growing a business. This person needs to have the time, energy, desire, and finances to invest in the future of the business. Property management is a fantastic business to be growing, but you need to realize that buying a franchise doesn’t mean buying a business. It’s buying what you need to grow the business. You must actively give the time and energy to grow it or your franchise will struggle. Buying a franchise gives you a boost and a kick-start to getting the business going. You get training and guidance, visibility and a lot of support. You’re given the tools without the expense that others would have to pay to acquire. Q: Do you have to be in the industry or can you come from anywhere? Brian: You can come from anywhere. It’s better, easier, and faster if you come from the industry or you’re a Realtor because you already know some things and have some background. You can be a property manager ready for the next step. There are advantages for those people. The training aspect is easier and there’s the fact that someone in the industry may already have some doors. But if you’re struggling and you’re making all the mistakes and you’re not growing, you might realize you need some help. That’s when it’s important to consider a franchise. I come from a family business that was very small. If I had known I could go to a franchise model, with the tools a franchise gives me, I’d probably be retired right now. The growth would have been faster and there would be less mistakes and less money lost. I would have given credit all along to the franchise brand. That’s why I can tell people today that unless you are a significant manager in the market you’re working right now, think about a franchise. It’s available for anyone and everyone. Randall: I always ask what will make a new franchisee successful and it’s really not the licensing or experience in real estate. In my view, we have three areas where we try to help new franchisees: real estate, property management, and also being entrepreneurial. That third one is the most important determiner of success. The people who understand business ownership mentality have a different drive. Everything else can be learned. It’s hard to motivate and inspire someone to have the drive it takes to be successful as a business owner. The program we put together is excellent at teaching operations, marketing programs, and other systems, but at the end of the day, the people with the drive are the ones who will be successful. Q: Can you give an example without going into too much detail of how that drive would affect the growth of a franchise? What are the elements if I’m considering joining the franchise? Randall: Someone I’m working with right now just emailed and said he had been working on the implementation of our training, and he’s doing all the things he’s supposed to do, but it’s just not clicking yet. He said he and his wife are working hard, but they’re not sure what else they should do to drive this business to success. In my view, this will be a successful franchise owner. He’s using Thumbtack, which is a tool that works great in some markets but not all. A successful franchisee is thinking about what else can be done to grow, and finding the right avenue that will work. I give them all the different possible avenues to try. I provide the methods and advice on what to do next. Someone who is willing to keep moving forward will definitely be successful.   Brian: I think sometimes success just comes to this: when the phone rings, you’re on it. When you answer the call, your mind is set that this conversation can lead to many different things and you keep an open mind. Figure out what that’s going to be. If it’s someone looking for a property manager, great. If they want to do something outside of my business model, I know I’m not doing that now, but I have something new to think about. Or, I can provide a referral. I’m building a long term relationship with anyone I speak with. Every conversation is geared towards the next most important thing you can do to grow your business. Not all property managers have this entrepreneurial spirit, and they don’t realize that every phone call has potential. We spend our time dealing with disappointed customers and complicated tenant issues throughout the day, and there are challenging owner issues taking up a lot of our time. But, we know that’s part of the business. You still have to have a positive outlook on how you run your business. Everyone is important. Other businesses cannot survive treating their unhappy customers the way some property managers treat their unhappy customers. Look at every contact as someone with potential, so you’re always growing your business. Even if it doesn’t produce a penny for you today or tomorrow, you’re still going to need business next month, next year and five years from now. Ask questions and let them know what you do. Talk to waiters, waitresses, taxi drivers, people in line at the airport. That’s how you reach people and grow.   Q: On our last podcast, Chris with Mainlander said to keep your antennae up. That’s basically what you’re saying now. And, you touched on something near and dear to me. I feel that everything in property management is growing fast, including services like ours at Fourandhalf. But there is a total lack of attention to the art and science of the sales process. I don’t understand how a $10,000 phone call goes unanswered. How is that feasible for the business not to hire someone who is responsible for closing this new business? When the owner takes a calls, that owner can usually close the sale. But that’s only if they get to the call. If they don’t get on the phone right away, the lead goes elsewhere. Some of the larger companies push these calls to portfolio managers, but they aren’t motivated or compensated to take new business calls. They have tenant and owner issues to deal with, and they’re taking care of their customers. So my question is, how do we fix this? Why isn’t the sales process a priority? Brian: We teach this model, and that’s why I think a franchisee can benefit so much from working with us. We have looked at the national average. The national average response time on an inquiry for property management services is 37 hours. Someone who wants to hire a property manager has to wait 37 hours to hear from someone. This is an awful statistic but I tell our franchisees they should be excited about it because they can make a difference just by answering the phone. Randall and I listened to some of the most awful phone calls. One was 26 minutes long and at the end of that conversation, where the business owner basically tried to not get hired, he still got hired simply because he answered the phone. He did nothing right after that, but he did the most important thing – he was available. I was a one-man office for many years and I saw my ability to respond to new business calls failing. I knew I needed a structure that made talking to a new owner about new business a priority. I did that for a while, and then my son, who was a broker, came in and told me to fire myself. I had to focus on running my business and hire someone who could talk to new owners and bring in new business. So we made that change. Having an organized, systemized process to physically handle those phone calls is very important. You can’t do that if you’re on your own. You’re busy meeting tenants, showing the house, and by the time you call a prospect back – it’s too late. Q: There are some solo entrepreneurs who can do it all. Bob Thomas is one that I think of. But many others feel that there are other things that are so much more important than picking up the phone. Then, they forget to grow. Randall, what’s your specific advice on the sales process? Randall: You mentioned passing the call to a portfolio manager. That’s a mistake. They are not incentivized in the proper way. So you want to set up someone who is incentivized only to bring in new business. You want to bring in a sales person who operates on a commission-only system, and is driven to set up appointments and close those doors. Many of our entrepreneurs are not phone guys. One said he is phone reluctant. The faster they can recognize that and properly incentivize that person to be an independent agent, the faster they will find success. Real estate agents are good at that. Not all of them are successfully selling right now, but they know how to answer the phone and connect with people, and they’re interested in making the extra money. Hire that out and stay close to it. The entrepreneurs who recognize this early and put that in place are much more successful. Brian: Another part of the problem is that many of us are very much Type A personalities. We know we are good sales people, and we think no one can sell our business like we can. But you are unable to grow when you get overwhelmed with things to do. You need a better structure. Another thing that makes it tough is unless you have good hiring experience in the past, it’s knowing how to hire that right person. Just because you’re a real estate agent doesn’t mean you are the best person to get new business. You have to know the business and attend the networking events and be comfortable with cold calling. When I was working my business al alone, I’d work 14 hours a day and every evening when a new lead came in, I’d call within a minute. I knew they hadn’t left their computer yet so I would call right away and show them that their needs were important. The success and close rate was tremendous. The first person who has human contact has the strongest chance of winning, whether you’re bigger or smaller or highly rated or not. You need to be the first one to have a meaningful conversation to solve the problem. Q: I agree. Every call is its own world and opportunity. You listen and ask questions, you connect with the person and understand their problems. You have to care, and focus on the speed of response and competence factor.   Brian: We understand how important the sales factor is, and not everyone has gone through sales training. So we do that. We have a specific hour one day a week designated to sales training for all our franchisees. We are working on it and teaching through it so anyone can improve their sales skill sets. We dedicate forever 52 hours a year to training in sales. So you cannot necessarily give someone the heart and desire to succeed, but we can give them the tools. Very successful franchise owners out there are tremendously successful despite their own history and personality. That’s because they’re being taught and they apply it to the best of their ability. They grow because of our education and support. This shows us that anyone with the right desire can do this. Randall: It’s about moving forward. How many times you can get up and keep moving forward? The entrepreneur who loses is the one who stops playing. Keep moving forward and you’ll get to success. It’s hard to give them the confidence to do that, but that’s the difference between success and failure. It’s continuing to move and push to learn those things. The best way to learn cold calls is to make a thousand of them. The learning curve changes but if you’re moving forward, you’ll get there. I tell everyone to remember that people dumber than you are successful at it every day. Q: We know the drive is important. Answering the phone is important. How do you qualify for a franchise? If I’m sold on this idea, how do I qualify to buy a franchise? Brian: Randall and I have nothing to do with sales and franchises. We are focused on the training and support and growth. We know that there is a financial expectation. There is a cost up front and you need the realistic ability to invest in growth when you first start. This business produces no money at first and unless you are an existing manager, you’re not going to make money on day one. Q: What’s the startup cost? Brian: The PMI franchise fee is $30,000. That’s one of the lowest investments into a franchise out there. You know you’ll pay some royalties, but what you get out of that is training and support. You have to be able to get a real estate license if your state requires it, and there are only a few states that have no such requirement.   Randall: The $30,000 is the franchise fee, but if you come in with only the $30,000, you’ll have a tough time. We hear Fourandhalf talk all the time about how much you must be willing to spend on marketing every month, and we’re very much in alignment with that. You really need to show us that you have money set aside to go out there and do things right out of the gate. That means spending $1,000 or $1,500 a month to do all the digital marketing and cover all the avenues. That’s another qualification. Brian: And you need to be prepared to get a real estate license in most states. You have to get your real estate license but even when you have that, you cannot do business unless you’re affiliated with a broker. So that’s immediately something you need to do. Affiliate with a broker, which in the real estate world, can be a problem because for many brokers, property management is fearful. We at PMI are structuring a nationwide brokerage system for our franchisees. We have preferred brokers that are much cheaper than what most brokers will do. The property managers need a license and a broker, and they have to create an entity. All these things that are required is the big benefit to having a franchise. If you are on your own, you can do it, but no one will guide you. I’m in Minnesota right now with a good company – 33rd Company. I’m in their office today and they shared with me how they started things. They just started without knowing all the rules. I continually hear about guys who started on their own and they didn’t get in trouble, but later they realized things were done wrong because there was no one to tell them what to do. We can help with relations, connecting people with the right brokers, and how to leave the brokerage and keep what they’ve built. In the real estate world, when you work with a broker, all the houses and the work you’ve done belong to the broker. Many people have done well as agents, but brokers take all their houses. It’s legal, and recently I’ve seen it with people who lost doors because they weren’t brokers. Q: So, we have covered having drive, answering the phone, and taking care of licensing and legal implications. I’m going to put my spin on this. As an entrepreneur, if you’re thinking about growth and you know you have $30,000 in the bank and $2,000 to use a month in marketing, you might think you don’t need a franchise. But that would be incorrect. You can be in business 20 years and manage 400 properties. Even starting Fourandhalf, we had to attract outside money and capital to spur the growth. I think that for entrepreneurs entering the business, this is cheaper than selling part of your company to investors. You guys make sense. Brian: In the real estate world, this system is proven. We are designing it around the property management world. Some of the most successful national real estate companies, like Berkshire Hathaway and RE/MAX are all franchises. They pay royalties and buy into the franchise. It’s designed for them to grow a business. Many of them are saying now that you cannot do property management as part of their real estate franchise. We are specializing in management, and at PMI we talk about residential, commercial and association collectively. The skill sets and requirements are the same and you’re not doing it on your own. You’re a franchise, and your visibility and effectiveness on the Internet matter. We can refer customers from one city to another, and that allows us to continue growing. Q: It’s time for parting thoughts. As a trainer, Randall, do you have parting words of wisdom? Randall: At the NARPM Broker Owner retreat, we heard from Steve Murray, of Real Trends. He was our opening speaker and he talked about where the industry is moving. We have to be out in front. We expect to have people who recognize the value of property management coming in. We solve key problems; finding business, how to market, where to get licensing and broker set up, and training on a variety of subjects like how to close, and what to do on the operation side. We expect and we have already seen an influx in people interested not just in property management, but in franchise. So our goal is to be on the cutting edge and be learning. We are ahead of the game because it’s changing very fast. Brian: When I want to start my business, I need to be business owner, a sales person, an accountant, a bookkeeper, a government affairs specialist, an HR specialist, a counselor, and a maintenance guy. I have to be all these things. Most of us are not all these things and we don’t know how to partner with experts. People like Fourandhalf who have expertise in specific areas can help us. To grow your property management business, you have to know that or be affiliated with the right places. That’s one of the things Randall teaches individuals. At first, you try to do these things on your own, but when you partner with people, you’re able to do it better. Never try this on your own because you’ll just end up wasting time and money. The cost of failure is high, so that’s another reason people are driving towards franchises. Thank you very much for your time, we’ll have to do another episode because I had 14 questions and we covered three. Thanks for your time, Randall and Brian. And for our listeners, thank you for joining us. And if you need help with marketing for property management companies, please contact us at Fourandhalf. We’ll see you next time. The post Exploring Advantages of a Franchise with Brian Birdy appeared first on Fourandhalf Marketing Agency for Property Managers.

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The topic today is how building a culture of innovation can grow your property management business. Our guest is Chris Hermanski, someone I’ve known for six years. Chris, can you tell us about yourself and how you came to be a property manager? A: I’m the owner of Mainlander Property Management, in Oswego, Oregon. Our emphasis is managing individually owned single family homes and condominiums. We have a portfolio of about 1,300 to 1,400 properties and we work with 1,000 to 1,100 clients. My degree is in business management and I’ve been doing this for 35 years. I kind of fell into the property management business. I was selling real estate for a few years, but that was when interest rates were high, so it was hard to make a lot of money. Then I started managing houses for builders and we built the property management company from there. I have been involved with NARPM since 1997. I’ve served on the Board of Directors for eight years, I’m a past national president and I founded the Broker Owner event. That’s really our platform for connecting with owners of property management companies and dealing with what’s new and coming. Q: It’s an honor to have you on our show because I know you’re busy so catching you for a few minutes is important. Let’s dive right in. I don’t think there is any more product innovation left. To really build something new you have to innovate the factory, not the product. I say this because one of the people I look up to the most is Daymond John, who said on Shark Tank that there’s nothing new that’s been introduced for the last 500 years. We are interpreting the old in a new way. Even Twitter is essentially a pigeon mail. It’s a note on a bird that gets scaled up dramatically with digital channels. You have been innovative with your company. In my early Appfolio days, you were already an established client. How do you come to be in the forefront of technology and how do you pick the good innovations? A: We are always looking for the next way to improve and enhance our business. I believe in technology and how it can enhance what we’re doing. I like learning how to apply it. I don’t look to the property management world; instead I look to other experiences I have as a consumer. Sometimes the property management field lags behind other industries. So I look to banking, the real estate community, and little things come up. I always thought it was cool when I had a dentist appointment and I got a text as soon as I made an appointment, then a reminder text a few weeks later, and then a text before my appointment. It might have been annoying, but I never missed an appointment. So I thought that would be cool if we could use the same technology for showings. We have come up with some technology that we think is ground floor right now, and we’re working to implement that. You have to keep your antennae up and see what’s going on and how it might apply to what you’re doing. With Appfolio, we were using a software product before that for accounting that was archaic and not doing well. We came across someone doing a fact-finding exercise for a property management solution, which became Appfolio. We were able to tell them what would make a perfect property management program. They created a dream cloud of what we needed. That was exciting. There are other innovations that are also exciting and speaking to what we need. Remote lockboxes and using standard business technologies like scanning our answering services or voicemail systems. We are always aware of how we can incorporate things from the property management industry and even outside of the industry. Q: Tell us about your decision making process. A company like Appfolio approaches you, and you know that switching software would be significant. How many properties did you have then? A: 1000 plus, I believe. Q: So there were a lot of properties to switch, which comes with some risk. I know that LeadSimple also came to you around the same time, but you weren’t interested in trying that technology just yet. So I’m curious: you made the move with Appfolio, but you weren’t ready for LeadSimple at the time. I know you’re using it now, but you didn’t then. How do you decide what’s good for right now and what you need to wait and see before you adopt it? A: A little of it is gut instinct and the rest is knowing what your current needs are. With LeadSimple, I felt like I was a fish swimming up hill to get it started. Our staff wasn’t quite ready to make that switch. But everyone was frustrated with accounting, so we were eager to try Appfolio. We used that system right next to our current system. That made it an easy transition. We were simply replacing the backbone of our operations. LeadSimple was more of capturing and managing and in the old days, we could be more casual about that. Today, it’s a more competitive field, so the technology we get from LeadSimple will become the backbone of our business now. Tracking new clients and having a CRM type mentality when we’re tracking and marketing is a new priority that we didn’t have when the company first approached us. The leads we get may be insignificant compared to other leads, but we still can’t afford to ignore them. We can’t always pinpoint where every lead comes from. Sometimes it’s from your reputation and things you’ve been a part of. Someone might see a vehicle with your name on it or someone might call us and we kept track of them and when they are ready, we are there. You don’t know when it’s going to be. Some of the technology is great that’s coming out, but not necessity for our company right now. If it’s not a significant part of what we’re doing right now, it doesn’t matter as much. When you find the technology that can really change things right now, you do your due diligence and you test drive it. I try to engage key staff members so employees can embrace it and see the learning curve as being mild. We want everyone to be fluent in it. Q: The property management business is, I think, growing significantly. It has a lot more room to grow especially when you think about the housing market. People can’t afford housing as much or they don’t care about owning a home. Millennials want to keep moving. So the market is growing and property managers are doing well. But the competition is there as well and the more efficient you are, the better. So keeping that antennae up and looking out for technology is your job as a business owner. Whether you’re checking into a La Quinta or the Ritz Carlton – there’s something to gain from that experience. But for implementing that technology is really about addressing an existing pain point and not doing something just because it’s cool. Appfolio addressed your pain point, so you went with it. A: Correct. At first, LeadSimple seemed more of a sales mentality than we were using at the time. This required detailed information and we were casual about our sales process. Now we are embracing it so we can ask more key questions and gather key information. We’re using a system rather than writing phone logs in spiral notebooks. We capture it so we can follow up. Q: Formalizing the sales process has become a huge pain point opportunity. A: Yes. To get the business, we have to formalize the process. Q: How do people find you? Why do technology companies come to you to show you their new stuff? A: I’m sure it’s simply because we are in the business. It’s not always them finding us. We go looking for them too. We ask questions all the time. We go to NARPM conventions and trade shows and we have also participated in our local market. There’s an apartment association that has a significant convention and we attend that. Different tech companies exhibit there. We pay attention to what we experience in everyday life. We research and we call people to think about how we apply certain things to our industry. It’s how we’ve latched on to remote lock boxes. There were so many hoops to jump through initially, but finally it has showed up. When I saw it at a trade show, I was ready for it and I bought it immediately. The company provider was able to elaborate on things that I had not even thought of. We have refined the process so we know how to use it and the technology has been a time saver. Q: Has that led to successful implementation? A: It has given us a lot of flexibility. We can give a person a code that only works for a short window of time so people can see the property. You have to have the stage set. Clients have to know we’re using it. We cannot always do blind showings, but it’s a tool. It’s one more tool to make us efficient. If we can do things with more efficiency, our people can work smarter. In this type of business, our big expense is salary and payroll. So if we can keep that down, it puts us ahead and we can add more capacity. Technology allows us to do a lot with the staff we have now. Q: Has there been anything that wasn’t successful? Or anything you regretted? What did you try to solve that didn’t get solved? A: We are still struggling with inspection programs. We have tried a couple and they’re good but they have their pitfalls. Most of our staff prefer using pictures and written correspondence. We’ve tried video and other technologies that other property managers swear by, but I haven’t found a perfect program yet. We are working through it this year and looking closely at how we can help ourselves. We do three inspections; the move in, the move out and periodic inspections. The software works great for those periodic inspections, but for the move in and move out inspections, we prefer low tech right now. Q: The current application inhibits rather than improves efficiency? A: Exactly. It’s more cumbersome and we need the right equipment like tablets with connectivity to save things. So we are still dealing with that pain point. Q: What has been your most successful tech implementation? A: Appfolio has been the easiest. We found something cloud based that we were skeptical about at first, but it was implemented right away. With digital photography and using pictures we have had easy implementation. The lock box program is successful. Those are what come to mind at first. We went to cloud based email versus a server based email and that was a different learning curve, but everyone embraced it. It was awkward at first, but once we got through it, it worked well. We’re also successfully using online storage for word processing and spreadsheets. Dropbox and the Google Drive have been easy to implement. Q: Is there a specific methodology for a rollout? Maybe you don’t put it on paper, but how does it happen? You have an idea and what happens next? A: I roll the idea by a couple of people. My son-in-law is new to the industry and I run it by him to get an idea of if it has value. He looks at it and flips things back to me. We talk about it and decide together. My general manager is a seasoned veteran and she’s a good balance. I’m a quick start and I like to get things going but I don’t always have the wiring to finish the job. She helps me do that. So we have an honest evaluation process. When we were looking at online scheduling, she liked the idea and we figured out how to embrace it. She sat in on the demos and it appeared that we had some traction and again it was filling a void we had and a frustration that we knew we had to eliminate. Then we got to a detailed level of looking at pricing and implementation. We do a test drive. Some things we test drive don’t work out, so we let them go. People who are selling these things are happy to have the feedback. Q: So, to summarize your golden nuggets: First, you gather a sounding board. It doesn’t need to be an industry expert. It can be, but maybe it’s a couple of broker friends, or a tech savvy person. You run it by them even if they are not in the industry. Then, you go to your VP GM and have them do the initial vetting and validation. Their opinion is heard, then you do the demo, review it and then get your hands dirty and test the product. So you roll your sleeves up, do it and make your decision. A: Spot on; that’s our process. Q: If you have only one piece of advice to give to a newer property manager – what would that be? A: Surround yourself with other people who do what you do. Go to NARPM events. Participate. Have a mentor you can brainstorm with. Ideally, that will be someone not in your market so there’s no apprehension and you can play off each other and work together. Learn from that. Keep your eyes and ears open in and outside the property management industry for tech advances and see how you can apply them to your business. Thanks for your time, Chris. We’ll see you at the broker owner event in a few weeks. And for our listeners, thank you for joining us. And if you need help with marketing for property management companies, please contact us at Fourandhalf. We’ll see you next time. The post How to Find and Implement the Latest Technologies to Grow Your Property Management Business with Chris Hermanski appeared first on Fourandhalf Marketing Agency for Property Managers.

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes My Co-Host and colleague Jordan Muela, with LeadSimple, visited the Fourandhalf studio to help me map out a solid sales process for your property management company. How to Set Up a Solid Sales Process for Your Property Management Company Hello and welcome to The Property Management Show. I am your host, Alex Osenenko. My day job is serving as the CEO of Fourandhalf, a marketing company working exclusively with fee-based property management companies. I have spent the last seven years of my life helping property management companies become more successful by improving sales, marketing and operational efficiencies. In this show, we’ll deconstruct success down to its key components and invite subject matter experts to help you improve every facet of your business. The topic today is how to set up a sales process for your property management company. The timing is good for us to help you put together a process so you can compete effectively and take advantage of every owner lead that comes into your company. You don’t need specific sales tools. Our guest is Jordan Muela, the creator of a property management CRM system, so his talents are in the sales process and how to automate it. But we’re talking about putting together a sales process that is so simple, it can be written on a notepad. Q: So Jordan, let’s dive right in and talk about the first stage of the sales process. Initially, when that lead comes in, whether it’s an email lead or a phone call, what is the most important thing that needs to be done? A: Discovery is what has to happen first in your sales process. Engage with people. Control yourself and don’t start talking about yourself and what you do. Start the listening process. Ask questions. Q: Yes. As a professional sales person, I am always extremely successful with any product I’m selling, and it’s not because I’m a great talker or a sweet guy. It’s because I ask good questions. I listen and I listen with intention and I’m able to dig a little deeper and ask a few more questions and understand the pain point and the problem. Don’t lead with a discount because if you do that, you’ve already lost. People don’t buy based on price necessarily. They say they care about your fees because they don’t know what questions to ask. In discovery, you connect with them emotionally. Tell us about acceptable response times. A: Getting someone on the phone as quickly as possible is basic. There are some very slow response times in this industry. The average response time in the property management industry is 39 hours. This is mind blowing and depressing. No one really owns that number because every property manager we talk to tell us they respond quickly. But responding quickly isn’t the goal. Responding first is the goal. It closes the sale. Q: I just read some reports on the status of the property management industry and where it’s going. I see a clear path for growth for property management companies. People want to rent and move around instead of buying. So property management is getting very popular and profitable. But there are more people competing for the management contracts because it’s so attractive. That’s why the sales process set up is crucial. Accounting has to be something you systemize. If you don’t have a grasp on trust accounting, you aren’t in compliance and you can’t run your business. Next, you need to systemize your sales process. I don’t think anything else will bring you as much value as those two pieces. Inspection software and marketing are secondary. Get your accounting and your sales process in place, and move on. Do you agree? A: That makes so much sense. It might sound backwards to some people. They think they need the leads first. But if you get those leads and there’s no sales process, you’re wasting your money and the leads will not work. So it’s a first order of business, definitely. Q: For the first few years that we were in business at Fourandhalf, I was the only sales person. It was one of my duties as CEO, but I had many others. The only way I could do sales successfully is by using a process. You may think that if you’re the only one selling, you don’t need a process. That’s not true because without a process, you can’t grow. The sales process for one is as important as the sales process for 10. What else do you have to tell us about techniques for discovery? A: Qualification is very important. When you’re thinking about sales qualification, we recommend using the acronym BANT – Budget, Authority, Need and Timeline. It’s a handy thing to keep in mind. You need to know if the owner you’re talking to has a budget. If he’s underwater on his mortgage and struggling to keep the home afloat, he might not be the best property management client for you. You need to know if they have the authority – do they actually own the home? Then think about their needs. Do they have crazy requirements for tenants that might be illegal and are they exhibiting problematic behaviors? Can you recognize their pain points and respond at an emotional level? Finally, there’s the timeline. You need to know what their decision timeline looks like. Lots of people skip over this, but you want to know if they are ready to buy now or if they won’t be ready for six months. This is the best way to frame and reference your qualifications in discovery. Q: I have a lot of experience as a consumer and I get approached by many different sales people offering me solutions. What I have found is that I rarely get proper discovery, if at all. They do a good job of listening but they are just waiting to say the next thing they have prepared. It disappoints me because the quality of salesmanship in today’s professionals is not great. You have an opportunity to compete effectively just by doing solid discovery and connecting emotionally. They won’t tell you their problems until they know you are there to listen. Many people ask me how long discovery should be. It’s a valid question and the answer is – the longer you stay on the phone, the more likely you are to close the deal. I say stay on the phone for 30 minutes, and you have a 50 percent chance of closing. If you stay on the phone for 45 minutes, you have a 75 percent chance. People like to be heard. Some discovery can be done in ten or fifteen minutes, but a good conversation and a good quality call lasts at least 30 minutes. A: That’s an interesting way to look at it, especially from the obvious level of how much time those leads are willing to spend on this. No one has the time to have four 45-minute conversations with different property managers. So once they know they have established trust, they are going to hire you. Q: Caring is really the art here. If they ask what your fee is right away, your answer is simply – we do have different programs for different property owners depending on where you are with your property. Let me ask you – how long have you had the house? Don’t ask for their social security number right off the bat. Find out how they came to be a landlord. Start from far away and build your discovery into a full conversation where both of you are engaged. When you do listen, take notes. Get to know those pain points. Interpret and validate what they say. Keep peeling. They aren’t going to tell you what they are about and they don’t know what to ask. So you need to get them ready to tell you about their pain points. Train yourself on care during discovery and take notes. That will be your first differentiator. So discovery is done. Now you want to talk to them about your products and services. How do you approach presentation? A: After you have established trust and you understand the customer’s needs, now you can sit down and start talking about your company. Once you are in that mode, you have a couple different things to say. First, have a script of some kind. At least a soft script. I understand that people get uncomfortable and no one wants to sound like they are reading off a teleprompter. Just have bullet points of your unique value propositions. Have a Q and A list and keep some bullets that anticipate objections and responses. This isn’t a word for word script, but a safe anchor and a reference point to cover all your bases. To generate this, mind what is already happening. Record your sales conversations if you can. That helps to refine your process. Another thing is to have sufficient sales collateral. That’s the asset you use to move people towards the sale. It’s not necessarily a sales discount, but an actual piece of video or visual collateral. You can use a PDF or anything where you are talking about your service, or featuring happy customers. Testimonials and case studies make good sales collateral. It’s not hard or expensive to create. People get nervous about video but it does not require hiring a film crew. Q: Content is the lifeblood of our business at Fourandhalf, and it’s not about production quality. It’s about care. How much do you care about your business? If you look a little uncomfortable on video, but you deliver high quality content, you’re the person owners want to hire. Have your team do an introduction or provide a PDF. You want to have something that goes beyond just a conversation and a thank you email, right? A: Follow up is huge but it can’t just be calling people asking them if they are ready to buy. Another great piece of sales collateral is the pitch stack. A pitch stack is basically a very quick summation of your services. It states what you do, how you are unique, and it addresses key concerns and questions. Some companies neglect this part of the process, but it allows you post-conversation to send something to people that isn’t your management agreement. They can look at it, think about it, show it to others. It demonstrates quality. Here’s the last thing on sales collateral – have a presentation folder. This is a physical hard asset so when you meet them at their property you have something that shows high quality presentation. It should include your logo and other forms of sales collateral. You can include infographics, and all the other things we talked about. It makes a difference. Q: And you can implement all or some of those. The beauty of sales is that you have the opportunity to test your process every time you talk to a lead. You can test it a few times a day. With presentation, if you are the only one doing sales, you know more about your company and your offering than anyone else. You’re passionate. But a bullet point list of what you’re going to talk about is beneficial, especially if you have a sales crew. If you are the only one selling, use your discovery notes to truly pinpoint your presentation to address the needs of the customer. During discovery, if you find out that your prospect owns two properties and one has a shaky tenant but the other has a great tenant, focus on that shaky tenant during the presentation. You can state the advantages of your services for the good tenant, such as online rent payment, but then really target how you’ll solve the problem with the bad tenant. Always look at your discovery notes and address the specific problems the prospect is having. Sometimes you’ll close the deal right there. You can do a trial close – which is basically stopping to say: “so what do you think?” Then, wait. If they need to hear more, keep going. But if they say they want to move forward after “what do you think” just stop talking and let them sign. You can finish the presentation later. A: That’s really good advice. You don’t want to start selling until you establish trust. And you want to stop selling as soon as they are ready to buy. Q: This is a mistake I kept making. I was always trying to add value to the conversation, but then I would talk my way out of sales. It’s miserable. So I removed that bad habit and you should too. So we have called prospects back quickly, established a successful discovery process and delivered the presentation. What do you do next? How do you close the deal? A: We have shirts that say: Always Be Closing. But we don’t mean high pressure sales. We mean that you need to view everything you do as contributing to the close. Calling prospects back quickly, paying attention to your discovery process and leading with value all help you close. Don’t pressure and don’t be repetitive. When everything is in place, make the ask. This isn’t a problem that everyone has, but some people are uncomfortable with the explicit ask. Put it out there and stop talking. Either you’ll get a yes or a firm no. if you get the no, they will communicate what their remaining issues are. That gives them the opportunity to keep moving forward. We say to Sell your Ask off. Q: I would say that with closing the deal, most of us underestimate the power of silence. An uncommon pause helps you position the ask. Stay quiet and common courtesy will not allow someone to just say no and also be quiet. If they say no, it will be an objection and they will justify their no. All you have to do is overcome or address that objection and remind them of their pain point and your solution. Then ask again. The power of a pause is a good one during close. It works. I think close is the easiest part of the process because you feel really connected to that person. You know you’re a fit and the close should be a natural next step. What can you tell us about the next step, which is follow up? A: Follow up is having a coherent plan for staying in front of people. You might be a sales ninja and you have done all these things and yet you’re a busy person and you don’t have a structured process in your follow up. That’s when things fall apart. I advocate acknowledging what you’re doing right now to follow up. Define it as a process and ask if you need to improve it. How frequently are you following up and how can you improve it? Having a baseline to improve and optimize is the first step towards having a better sales program. Your format and style will be your own. At LeadSimple.com, we have a 10-Touch 20-Day Model for our customers, but there are many ways to do it. Have a follow up plan and use it. Q: Following up is that major differentiator. The follow up is critical because if you mess up the presentation and the close, you still have the follow up left. That’s good because you can communicate efficiently. Check out Jordan’s follow up information on LeadSimple.com. Then, implement it as recommended and adapt it to yourself. This takes work. Two or three times a week, go through your call list. Whatever your system is, you need to do the work. Call the prospect ask how they are and how the house is doing. Send an email. That consistency and diligence will help. A: And it starts to narrow the field. Sales is like a long endurance race and other property managers will start dropping out. Other sales people completely check out after hearing no. If you’re still caring and following up three or four months later, you’ll get the deal. Q: So we have a blueprint: Discovery, Presentation, Closing and Follow Up. That’s it – four steps, and we don’t need to overcomplicate the sales process. Where can our listeners find you, Jordan? A: Check us out at LeadSimple.com. Thanks for joining us. And if you need help with marketing for property management companies, please contact us at Fourandhalf. Thank you for listening, and we’ll see you next time. The post How to Setup a Solid Sales Process for Your Property Management Company with Jordan Muela appeared first on Fourandhalf Marketing Agency for Property Managers.

Our guests today are Kim and Scott Hampton with of Hampton & Hampton Property Management. Kim and Scott take us through their story of starting and building a successful property management company in Orlando, Florida. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The Property Management Show is brought to you by Fourandhalf. We help property managers strategize and implement marketing plans that bring in owner leads. Click the image below to get a free marketing assessment and find out how to start getting better clients into your portfolio. The post “How We Did It” – A Husband and Wife Story of Starting and Building a Successful Property Management Company appeared first on Fourandhalf Marketing Agency for Property Managers.

Our guest today is Jindou Lee, CEO of Happyco.com, a company that provides Mobile Inspection tools for the Property Management industry. Alex, who hosts the podcast, is the CEO of Fourandhalf, a digital marketing agency that works exclusively with the Property Management industry. Happy Co and Fourandhalf are very different businesses, however the success of both relies in building and retaining best-in-class team of people who represent the company values to their customers every every day. In this Podcast interview, Jindou and Alex discuss the specific methods of hiring and motivating their team to achieve peak performance and keep the office as a fun and productive environment. Property management companies are service based businesses and the quality of your team will literally make or break your business.  Please share your team building ideas and advice in the comment section. Enjoy the interview and thank you for tuning in. Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes The Property Management Show is brought to you by Fourandhalf. We help property managers strategize and implement marketing plans that bring in owner leads. Click the image below to get a free marketing assessment and find out how to start getting better clients into your portfolio. The post How to Hire and Retain the Best Talent for Your Property Management Company with Jindou Lee appeared first on Fourandhalf Marketing Agency for Property Managers.

Subscribe to The Property Management Show on iTunes Today to Stay Up to Date on the Latest Episodes Our guest today is Jordan Muela, CEO of LeadSimple, a company that provides CRM solutions to the Property Management industry. Alex, who hosts the podcast, is the CEO of Fourandhalf, a digital marketing agency that works exclusively with the Property Management industry. Over the last few years, Jordan and Alex built their respective businesses to a multi million dollar growth machines while solving real problems in the Property Management industry. After seeing 100s of property management companies succeed and fail, Alex and Jordan have a wealth of experience to share on how to Grow and Scale a Property Management business in 2016 and beyond. Take a listen. Here is the transcript of the Interview: 10 Property Management Business Growth Hacks for 2016 Hello and welcome to The Property Management Show. I am your host, Alex Osenenko. My day job is serving as the CEO of Fourandhalf, a marketing company working exclusively with fee-based property management companies. I have spent the last seven years of my life helping property management companies become more successful by improving sales, marketing and operational efficiencies. In this show, we’ll deconstruct success down to its key components and invite subject matter experts to help you improve every facet of your business The topic today is 10 tips for growth hacking your property management business. Let’s define growth hacking. It’s an interesting term that a lot of people don’t understand. I had to go on Google and look it up. Growth hacking is a marketing technique that use creativity, analytical thinking and social metrics to sell products and gain exposure. Specifically, most growth hackers focus on low cost and innovative alternatives to traditional media marketing. Our guest and co-host is Jordan Muela, who is the CEO of LeadSimple, which provides software for property managers to handle their lead nurturing and sales process. Each of us will provide five growth hacks that we see as being useful for property managers. Jordan: Productized Rental Reports. A lot of companies have different offers and enticements to get people in the door. A popular offer is to establish an exchange of information for an email address. The rental report allows potential customers to find out how much their home will rent for. It’s a straight forward, basic proposition. Consumers understand what they’re being offered. A lot of people are putting this offer out there, so the challenge is in getting them to bite. You want to provide a rental report that is interesting and well designed. People will feel like they gained something. Don’t jot some information down or type it up loosely in a Word document. Work with a company like Rent Range which has professionally put-together report. You can customize them with your brand logo. This provides a nice, slick deliverable. When you get people to your website and you’re offering this report, take a miniaturized image of it and use it as part of the enticement. People need to see a visual ahead of time so they know they’re getting something of value. Renters Warehouse does this really well. Check out their Contact Us form and you’ll see the preview graphic of the report. It’s an inexpensive offer that will give you a lot more mileage out of website traffic. Alex: Once you start getting those leads, people who want to download that report and see what their house will rent for might not be ready to work with you right away. That’s okay, because it leads us to my first growth hack, which has to do with marketing and growing your business. Content. At Fourandhalf, we talk about the value of content all the time. We know that 80 percent of all searches are long tail, which means people are asking Google questions. Another interesting statistic is this: Amazon.com makes 57 percent of its sales from keywords outside of popular terms. So people aren’t searching for shoes, but they might be searching for green shoes that reach the knee for fishing. This demonstrates that content is by far the foundational way to monetize just about every avenue of your business, including productized rental property reports, your website and pay-per-click programs. Here’s an example of content and how it can become your ultimate growth hack: Five Ways to Remodel your Rental Property in Chattanooga to Cash Flow in 2016. There’s your article. If 50 people find it in 60 days, how many of them do you think will have a rental property in Chattanooga that they are thinking of remodeling? Most of them. That’s why content is my number one. Jordan: I love content because you don’t just publish and leads start coming. You produce the content and the value comes in over a period of time; maybe 5, 10 or 15 years. It’s the gift that keeps on giving. Lead Nurturing. Lead nurturing is so valuable. Lead nurturing is not throwing away leads that don’t convert within 14 days. Your lead is a real person with real person problems. They might not be ready now, but they could be in a year or two. As a lead provider, we have seen what happens with most companies in terms of follow up. Their follow up is not pretty in the short term and nonexistent in the long term. Don’t burn your leads. Nurture those long term relationships, even if they don’t close right away. Lead with value and follow up with value. Building a buying preference and when that lead is ready to buy two months from now or they have a friend who needs to buy two years from now, you own that preference. Having a lead nurturing program in place allows you to own the mindshare of your consumers when they’re ready. Set up a process via email automation where you pair high quality content with well-timed relevant emails that go out over a period of 12 to 24 months. Very few companies do this, so it’s a wide open opportunity and you always want to compete in these types of spaces. Alex: All of these pieces go together. Just providing the property reports is going to close a few deals but will take some time. But when you plug all these three things together, your growth hack gets bigger. People think it’s too expensive and time consuming for property managers. If you don’t do this yourself, there are people like us who can do it for you. You can do it on your own if you want to, and if you don’t think you have the time or the resources, hire someone who can. Reputation. Without reputation, you might as well not try to grow your business at all. It’s a simple focus on asking your happy customers to give you their testimonials on channels that other people trust, like Yelp and Google. Post these reviews on your website so people see it’s real. If you aren’t focused on your reputation, you may win a battle or two, but you’ll lose the war. It’s paramount. It’s also the ultimate equalizer. A company that has been around for a year can compete with a company that has been around for 20 years. Reputation management allows a new company to look better than the older company. People look at star rankings and reviews and they also look at the number of reviews. If your review capital is low and you have three five star reviews, that’s great. But if you have 300 reviews and a four-star ranking, you’ll outsell the competition every time. Ask your good customers for help, and you can turn around your reputation. Get those people on the record talking about your company. Jordan: At the end of the day, you’re catering to the reality of how people search. We are all consumers who want to read reviews. It doesn’t matter what you’re buying. This is a hack or a way to get ahead, but this is also necessary for your survival. Don’t be ambivalent about it. Property managers have dual customer bases – property managers and tenants. One group is way more motivated to leave reviews. One segment of the population spends a lot of time leaving negative reviews. You have to fight back against that. Throttling Pay-Per-Lead Services. There are a lot of services you’re familiar with when it comes to Pay-Per-Lead. I like Pay-Per-Lead services because it’s a value for value transaction. There are list directories where you pay for an ad but you don’t know what you’re going to get. With Pay-Per-Lead, the math adds up. They work. When you have a good conversion rate, all of these services are effective. Many people choose between Pay-Per-Click and Pay-Per-Lead, but it makes sense to use several different services. If you’re not focused on aggressive growth and you want to stay steady, then maybe you’ll choose one over the other. You have to be signing new contracts even to stay in the same place. If you have any ambitions to aggressively row, you can’t work with just one. Most companies that grow big claw into every lead source available and combine them to have something that really works. If you’re actually growing aggressively, you don’t have to pick just one or the other. Throttle the Pay-Per-Lead market and get qualified leads wherever they come from. ROI is your focus, so calculate your cost per contract, which is a function of customer lifetime value. If you have a good business and strong retention, your customer lifetime will be high enough to pay for leads from more than one vendor. Alex: My next growth hack is completely aligned with that. It’s Pay-Per-Click. Pay-Per-Click. If you want to go out and buy accounts or property management companies, you’ll pay at least 12 to 18 percent to acquire properties under management. If you buy a 100-unit property management company, you will pay $1,200 per property at a minimum to acquire that business. Growth hacking means finding alternative means. Traditional growth is acquisition. The reality is, if you maximize your Pay-Per-Click budget, you will pay less than you would acquiring a property management company. When you have a landing page for your Google Ads campaign and your sales staff is succeeding, you can spend $300 to $400 per contract. That’s half the price of acquiring management contracts, which is growth hacking. Jordan: It’s reliable and steady, so there are a lot of attractive aspects to Pay-Per-Click. You’re owning more of the asset involved, instead of just the lead. Calling FRBOs or For Rent by Owner. This is different territory. The companies we work with who have a portfolio management model use this from time to time. Property managers who are just starting out and looking for business will be aggressive, calling signs and FRBO properties and visiting realtors. We don’t see it as much with companies at scale. It’s a discipline. No one wants to make these calls. You also have to find a list. However, it’s another lead source to consider. It may or may not work for you. You need a good script and a good list if you’re going to use this growth hack. You’ll have to get over your call aversion. You can get lists from sites like PMleads.com. They provide daily lists of FRBOs that are scrubbed. It’s one option. Rent Range and Rentometer will also provide lists. It’s not the sort of thing I suggest to do intermittently. If you’re going to do this, have a dedicated and delegated person in your company to do this. Alex: I think outbound strategies are different and we don’t see a lot of outbound calls unless a computer is calling. Does it work? Jordan: If you look at an adjacent industry like real estate, the outbound dialing model works. No one likes cold calling, but people can build business off it. This is an activity based model with ales. It does work in real estate; it’s just not as mature in the property management world. We have some clients who do it and do it well. It can become a long term channel. Alex: We do 10 well-researched calls per day per person. We’ll send an email with a topic that’s relevant so people open it, such as How to Get Started on your 2016 Property Management Marketing Plan. Blindly dialing, however, is not a great plan. Always think quality over quantity with outbound marketing. If you can figure out evictions and get your hand on a list of evictions and find those landlords who are dealing with evictions, you’ll clean up. Join Local Organizations. This is a growth hack for a couple of reasons. First, you are a local business. You have a territory. You’re not going to manage outside of that territory. So it’s important to physically get to know people and become a pillar in your community. Join the Chamber of Commerce, the Rotary and teach a class at the local community college. Talk to local rental housing associations. Teach them something. Become known in community. Let them know who you are and what you do. That will lead to referrals and business. The second reason is that it improves your SEO. There is tremendous value in the link to your business from your local college or rental housing association or Chamber. That link goes to your website and it doesn’t even matter if people don’t click the link. You’ll get a huge SEO boost. In a competitive search landscape, the company with the highest quality and quantity wins. That’s how you get to search positon number one. You have content and structure, high quality backlines from authoritative institutions, and you will trump your competitors. Make sure you’re listed on their websites with your link and you’ll do well. Jordan: I love relationships and branding as well as giving back. You’re actually serving your local community when you become part of it. It’s a long term lead generation hack, and that’s how you win. Having a Growth Plan. Your growth plan is to audit 2015 and see where your inbound inquiries came from. Review your conversion rates and lead sources. This is not push-button for most companies. You may have reporting, but you don’t know if it’s accurate. So go back and if you have a system or some reporting, check it. Collect information and generate data. Audit the last year and see what worked and what didn’t. Use that to strategize for the next year. Having a goal and plan will force you to make certain decisions. Write down how many additional contracts or properties you want to gain and work backwards to understand what you have to do to get there. How many leads will you need to generate and what will your conversion rate have to be? Do the math backwards and have a plan. Work the plan. Alex: This is exceptional, and my last growth hack is similar. You have to get tactical. Having a Marketing Plan. If you start pounding the pavement and you know what you want to do, you need to have a whole plan. Don’t just pick one or two things that might work. Get as much as you can out of your time. Be strategic when you implement it. Get all the elements together, review your business and gather data. Look at what is closing and what lead channels you used. Calculate the cost per lead for each channel. Figure out the closing ratio. Really plan out the marketing part of your business. Then, get out of the grind and build a plan that will grow your business. Thank you to Jordan for talking to our audience. You can find Jordan Muela at LeadSimple.com. Think about taking their sales course, which can give you some perspective on growing your property management business. You can always find us at Fourandhalf.com, where we do property management marketing. The post 10 Property Management Business Growth Hacks for 2016 with Jordan Muela, Hosted by Alex Osenenko appeared first on Fourandhalf Marketing Agency for Property Managers.