Cutting costs is something every savvy business owner should be thinking about. With the recent economic downturn, however, it’s become more important than ever to make sure every penny spent is justified. The good news is, even if you think you’ve already tightened your belt as much as possible, there may still be a few creative ways to eliminate overspending without sacrificing the quality of your service. Let’s explore a few ideas below.
Get to know your numbers.
Accounting for a property management company can be incredibly complex. That’s why most firms hire experts to handle this portion of their business. But delegating the work doesn’t mean you should completely wash your hands of it. To the contrary, you should keep a close eye on your company’s finances so you can easily identify areas for improvement. Property management software that features the ability to run customized, easy-to-understand reports can be a tremendous help in this regard.
Handle your own maintenance.
If you have a smaller portfolio, you’re handy and you can feasibly work it into your schedule, you may be able to save some cash by handling some of the basic maintenance tasks and property upkeep on your own. For instance, mowing the lawn, painting and performing minor repairs yourself instead of hiring someone else could save you hundreds or even thousands of dollars. Just remember to leave the big stuff to the professionals.
Audit your expenses regularly.
Most service contracts are negotiable. For those that aren’t, you might still be able to shop around to find a better rate. It’s a good idea to review what you’re spending on a regular basis to see if there are potential areas to save. For instance, you may discover that your utility bills have gone up and a competitor can offer you a much lower rate if you switch to them. Don’t be afraid to shop around and make whatever changes are necessary to get a better deal.
By transitioning from paper records to electronic files in your property management business, you can instantly slash a good portion of your routine expenses. For example, you’ll no longer need to purchase reams of paper, maintain equipment like printers and copy machines, buy ink or toner, etc. Switching to digital records can even enable you to go remote with your workforce, eliminating the need to maintain an expensive office space for your employees. Think of how much that would save you!
We’ve said it countless times – retention is the key to long-term success in property management. By focusing on keeping your reliable tenants happy, you can improve the odds of them staying for the long haul. The less tenant turnover you have, the less money you’ll have to spend throughout the year on things like advertising, screening and prepping units to be re-rented. Prioritize communication and treat your tenants with respect. That small investment of your time could save you thousands.
In these uncertain times, it’s crucial that property managers don’t spend their money frivolously. Take some time to analyze your business with a critical eye, looking for areas where you can become more efficient and profitable. The five ideas above should provide a great place to start.