In the past, I have talked about building a team of people so that you can work on the business, instead of in the business – I want to get a little more into detail on how you can go about doing that. As a property manager, you have a lot on your plate, and if you have any desire to grow your business (and any business that isn’t growing should reconsider what it’s goals are), then you need to work towards building a team which will allow you to expand your capabilities and the number of properties you can manage.
Firstly, if you are currently working as a lone property manager with no team of people (that is you are doing everything) then you likely are finding yourself spread thin. Your time is taken up doing a large amount of activities which don’t actually advance your business. Think of breaking your business into two parts – one part works on bringing in business, the other part works on fulfilling the promises you made to bring in that business. If you are alone, then most of your time is likely taken up working on the latter – which means your business is not growing.
So when looking to work on your business – instead of in your business – your first thought may be that you should hire employees. This is a logical progression, but I would caution you from diving so deeply into that from the start. At the beginning of this process you may find yourself in a chicken/egg situation. That is, you need a certain level of income to justify employees to take care of the jobs you are currently doing – which are sustaining that level of income.
The best step at the beginning I find is to forget about hiring employees and work on your contractor base. There are two reasons for this. The first is that you won’t have to deal with taxes or health insurance or anything of that nature related to actually having employees in your business. You also don’t want to immediately shift your time from working in the business to managing people who are working in the business. Employees require management – and you can certainly (and should) have a style of management and practices of hiring which lead to minimal time requirements on your part – but at the beginning of the process, changing your focus from in the business to on the business is the name of the game.
The second reason for going with contractors is that unless you have a larger company (and even then) you will find that you frequently require the use of contractors for various activities. When you are starting out, you can contract out all the maintenance, grounds-keeping, and even if you wish the marketing aspects of the business (reducing the time you need to spend on things to bringing in new tenants, managing current tenants, and expanding your business). So if you work to build out a contractor base like this you will be able to build a very effective network of people who are happy to work with you so that in the future you can both have references, and more easily find good contractors when needed.
Remember, the name of the game is to change your focus from working in the business to working on the business – you might in the short term lower your net profits by contracting everything out, but the result will be the long term growth of your business.
More on looking at Employees tomorrow…