How to Scale Your Property Management Business

Take it from us: property management entrepreneurship is a thrilling journey, but it’s not without its share of intense growing pains. These challenges will test your resilience and determination, leaving you wondering at times if it’s even possible to build a profitable business. If you’re stuck in the nightmarish land of tight profit margins and low returns, it’s time to learn how to scale your property management business for growth.

What are Economies of Scale?

Let’s go back to school for a crash course on business profitability. If you ever took an economics or business management class, you learned about economies of scale. But what are economies of scale and how do they apply to property management?

In short, economies of scale are the benefits you’ll reap by increasing productivity. When you increase output while decreasing overall expenses, your profit margin soars. Economies of scale help you to build a healthy, robust company that can weather storms with ease. Wouldn’t you like to stop being a slave to the ups and downs of the market, once and for all?

Use the five steps that outline how to scale your property management business and achieve your full earning potential.

Determine Your Current Profitability

First things first: it’s time to take a hard look at the numbers in your business. If you’re not already crystal clear on things like gross profit margins, overhead costs, and projected incomes and expenses, make an appointment with your accountant. The sooner you have the hard data in hand, the more quickly you’ll be able to act for the good of your company.

Every business has sunk costs, including monthly expenses like rent, utilities, and salaries. When you focus on how to scale your property management business, it’s tempting to look for avenues to slash costs; cost-cutting measures are great, but scaling is primarily about increased output to balance out the expenses you incur. In other words, you want to take on more doors, represent more investors, and double, triple or quadruple your team’s productivity, all without dramatically increasing costs.

Reducing overall expenditures can prove invaluable, but remember, your goal is to utilize the principle of economies of scale.

Once you’ve crunched the numbers and you have a firm grasp on the financial health of your company, you can begin making moves to drive profits upward.

Develop a Strategic Plan

If you’re not already using strategic planning in your organization, make this a top priority. The importance of strategic planning is simply impossible to overlook.

Strategic property management planning provided immediate clarity and direction, which almost always results in collapsed time for your employees. This in turn allows productivity to skyrocket.

Do a simple thought exercise: How much time do you spend in your day answering phone calls and responding to emails?

If you’re like many entrepreneurs, you are exhausting yourself week after week, trying to drive your business forward. But concretely, you can’t account for the time spent each day. It all gets swallowed into a vortex, leaving you spinning your wheels in a frustrating cycle of mediocrity.

Time is the most valuable commodity a property manager possesses. By bringing strategic planning into your business, you’ll define your purpose, values, and long-term goals. This clarity guides decision-making at all levels, ensuring that everyone in the organization understands their role in achieving these objectives. This will help you align resources, efforts, and initiatives with your overarching goals, reducing wasteful activities and maximizing efficiency.

Systemize Current Operations

If you’re wondering how to to scale your property management business and haven’t started systemizing your operations, it’s time for a reality check.

Implementing standardized systems and processes ensures that tasks are performed consistently and efficiently. This minimizes errors, reduces waste, and saves time, ultimately lowering operational costs and increasing profit margins.

Systemizing your property management processes sometimes freaks people out. It sounds like it takes a ton of effort or might prove impossible to implement. With the right tools, however, it’s easy to streamline the way your team works. It looks something like this:

1. Ask your team members to document the steps they follow for the most common processes in your business.
2. Next, clean up those outlines and make a step-by-step process document.
3. Finally, ask your team members to follow the established process every time they do it.

Using property management process software like DoorGrow Flow can be an invaluable part of this process; not only is this tool designed to provide a visual representation of each process your team uses, but it comes with dozens of built-in property management processes developed with best practices in mind.

Dial in Your Team

You can’t scale your property management business without getting really clear on your staffing needs and determining whether your existing team is hitting the mark. It’s easy to fall into the trap of playing the nice guy. You don’t want to let people go or readjust the responsibilities on their plate, because that would somehow be unfair. Maybe you have people on your team who aren’t pulling their full weight, but you share a personal connection with them.

There is no one-size-fits-all approach to solving all of your staffing woes, but there are tools you can use to shift your perspective. As part of our operations training in the DoorGrow Mastermind, our team works hand-in-hand with our clients to help them get expenses in check. In your property management business, this might look like using virtual assistants or recruiting employees who offer a better cultural fit.

Secure Additional Sales

Let’s face it: if you want to scale your property management business, you’ll need to increase your door count. Many entrepreneurs struggle to get property management leads, which is undeniably an invaluable part of the equation. If you’re just throwing money at advertising and waiting on the phone to ring, however, you’re not going to see your business reach its full potential.

Instead, it’s important to rethink the sales strategies you’re employing. Are you maximizing the value of your referral partnerships? Have you optimized your property management pricing to ensure you’re not leaving money on the table when you sign new deals? Is the Neighbor Strategy something you’ve begun to implement in your business?

Every property management business looks different, which is why it’s important to get support from a property management coach who understands your unique challenges and can help you rise to the occasion.

Ready to scale your property management business to 1,000 doors without costly advertising? Take our free course to learn how.