Is Your Property Management Business Scalable?
Scalability…it’s a bit of a jargon word, but its definition is simple; How well a company can maintain or improve its profit margins while sales volume increase?
In other words, how future-proof is your business? How easily could it handle an extra 20%, 30%, or 40% of revenue?
Could your systems and processes (and staff) cope with the added pressure?
The answers to these questions determine how scaleable your business is.
A scaleable business is hugely important if you plan on growing, which almost 100% of business owners hope to do.
After all, who wants to spin their wheels and not move forward?
But scaling your business requires a strong structure – every builder knows a house is only as strong as its foundation.
Failure to prepare your business for scalability could have dire consequences, including burnout, management headaches, and loss of profitability.
Some businesses can reach a point where they realise they are not built to scale up, but only when it’s too late.
Choosing the right organisational structure, systems, and tech will allow you to grow sustainably.
This blog will discuss some ways you can prepare your business for scalability.
Understand your current business model
The first thing you should do when scaling a business is to understand the strengths and weaknesses of your current model.
Are you currently using a portfolio or a task-based model? If you are already using a task-based model, you may be well-placed for growth as some property managers using that model can manage 300+ properties each.
Beyond that, other questions to consider include:
- Is there consistency across the business? (Does everyone do that same process identically?)
- How well could you cope with the loss of your most important staff?
- What profit margin are you currently operating on? (Many businesses don’t prioritise the profitability of their rent rolls, but this is an important component of scaleability.)
- Have you documented your processes and workflows across your entire business?
- Are your processes scalable? Efficiency and consistency are key here. A process that might only take 1 minute becomes a problem if it needs to done 50 times a day.
- Are you leveraging technology effectively? (It’s not about having MORE tech, it’s about having the RIGHT tech.)
- How much visibility do you have over the workflow of your business?
Understanding the answers to these questions will tell you:
- Whether yours is a people or process reliant business – you can’t rely on people to carry the extra burden of growth.
- Whether you are too reliant on individual staff.
- Whether it is worth growing or focusing on profitability first instead. (Remember, a smaller rent roll with healthy profit margin is often worth more than an unprofitable larger one.)
- Whether you are using the right tech. (The right technology keeps people accountable through visibility, and should bring simplicity)
An honest appraisal of the strengths and weaknesses of your current business model and practices is the best place to start to prepare your business for scaleability.
Prepare your business for scaleability – key takeaways
- Conduct an honest appraisal of the strengths and weaknesses of your business.
- Choose the right model for you – portfolio, task-based, or a hybrid of the two.
- Transition to a process-driven, not people-reliant, business. (Ask us how)
- Introduce technology that brings simplicity, and encourages accountability through visibility.
Is Your Property Management Business Scalable? Contact the team at STAFFLINK to chat about ways agencies in Australia & New Zealand are preparing their business for growth.