6 Strategies to Position Your Property Management Business for Better
Implementing a growth strategy to further your apartment, HOA, or condo management business goals is necessary for long-term survival. According to the Small Business Association, more than 30% of new businesses fail within the first two years and 50% fail within 5 years with only 25% surviving after 15 years. One of the biggest reasons for this failure has to do with a lack of a proper growth strategy resulting in companies either growing too slowly or too rapidly. In this post, we provide some strategies that management companies with various client bases can utilize. When implemented successfully, these strategies can help solidify your management company’s financial and competitive position, increase profit, expand the customer base, and build an even more credible brand. With the multitude of benefits a growth strategy can provide, it’s first important to note that the strategy your company employs will depend upon the company’s goals, internal and financial resources, and the current client base size. Let’s dive into these 6 growth strategies!
1) Expand your portfolio into different housing markets
Expanding your portfolio to cater to different housing markets is a great way to gain new customers. Diversifying your business through different markets can also solidify your financial position by reducing the risk that catering to only one client base may often bring. Management companies can decide to specialize in a number of housing markets including homeowners associations, condo associations, apartment complexes, co-ops, high-rise condo’s, student housing, senior living, vacation rentals, and more. After your property management company has gained an optimal level of expertise and is ready for expansion, identify new markets the company can enter for additional growth. For example, a management company that currently caters to homeowners and condominium associations can consider taking their expertise to the high-rise residential market.
2) Expand your services
Another way to gain more customers is by adding new services to your current offerings. Increasing or enhancing your current service offerings can help your company to improve upon its current skillsets and successfully upsell the service. Services that you may add can include niche projects that your competitors may not offer. Let us say for example, many of your prospects and existing customers are struggling with finding the right vendors for their communities. Through conducting market research, you learn that your competitors do not offer a vendor evaluation/bidding service. This information tells you that by adding a vendor/maintenance management service to your offerings, you can fill an important need in the market and in turn, you stand to gain new clients and can increase fees for participating clients in the following year.
3) Market to new geographic locations
There are good reasons to take your services to new locations. Through market research you may find that the current region your management company operates in is saturated, revenue generation doesn’t justify the cost, or another regional market has an unmet need your company can fulfill. When treading new waters, you’ll need to consider how your prospective clients operate and their pains, state and city regulations, and additional staffing needs.
4) Improve or add amenities
If you manage apartments, rental, or other high-rise communities, it’s important to think out-of-the-box to implement amenities that can bring value to existing and new residents. The type of amenities you can build for the communities will depend on the demographics of your community. If your residential communities comprise of mostly seniors, your amenities should speak to their lifestyle needs. If your residential communities comprise of mostly millennials, then consider budgeting for amenities such as gym, sports areas, or educational classes. It’s also important to consider building amenities that can help bring different demographics together and instill a sense of community. You’ll not only increase the likelihood of gaining more clients but there is also the potential for gaining additional revenue beyond rental fees.
5) Upgrade to a more powerful technology system
A robust technology platform can become a powerful asset to your community or property management company. It’s not simply because of the efficiency it provides your team; rather, it’s the added value it brings to the services you can deliver to your prospects when they decide to do business with you. Your prospects look up to your services because they need help with a variety of community operations – resident engagement, customer service, maintenance management, and more tasks. This means that boards and apartment prospects want solid technology tools that will help them achieve their community goals.
6) Acquire new management companies
It often occurs that a management company will purchase another smaller, mid-sized, or large-sized management company. This is an advanced growth strategy that requires a large capital investment, but can help gain a significant foothold in a new housing market, city or state, or gain expertise to fill current gaps.
Staying competitive through growth
Growth is essential in the property management industry to remain competitive and to be able to keep delivering great customer service to your HOA, condo, or apartment clients. Growing through portfolio expansion, new cities, new services, amenities, and technology can deliver great benefits to management companies wanting to increase market share, profit, and fulfill unmet market needs.