Shift Mindset
# 20. Big A Agency Get Thinking Correct .. #1 .. Why.. 908 (https://vimeo.com/950093957) duration 07:35 [related] Vimeo auto-generated captions (en-x-autogen VTT), not Whisper Well, okay, Robert Locke here.
Thanks for signing up. I appreciate it. We're kind of moving along this conversation about big A versus small a agency. We, we have talked in the first video about the challenge of going from a sales mindset where you operate as a small, a agent and move to a big a, agency model make to make property management work. We kind of looked like this.
We said salespeople come out of this mindset where you're a trusted advisor to the owner, but you don't make any decisions for the owner. And in property management, you begin moving down the spectrum and begin stand in their shoes. You act as their under their benefit, under the authority of a power of attorney. You make decisions for it. So under the management agreement, under a limited power of attorney, you give yourself all kinds of authority to approve applications and to evict tenants and to, to terminate leases and reinstate leases and spend money.
It's a bunch of things that you get to do in property management that you don't do in the sales world. Now, the next step of this is get your thinking correct. I've already spent a little time kind of emphasizing the idea why you need to become a big a agent on the management forefront. So we're gonna answer the question, why it, why is it important to embrace big a agency model? You're sitting there saying, okay, I get it big a little a, why should I embrace the big a agency?
Why should I start making decisions for the owner? So here's the answer.
Volume Importance
To make money in property management, you need volume. It's really hard to make money in property management with 30, $40, isn't it? Some of you do that. Some of you are in the sales world, but you also got a foot over in the property management business and you manage 30, 40, 50, 80 doors. Really hard to make money with it, isn't it?
Yeah. We bought out 14 management companies during the last 15 years of our career. Every one of 'em were sales agents who were managing somewhere between 50 and a hundred doors, and they just got overwhelmed with the nickel, dime nature of it. Couldn't figure out how to make any money with it. One of the reasons is because they took this mindset of a sales agent where you're a trusted advisor and you're a scribe.
And I did that for 20 years. And you can begin to, you need to begin to shift over and realize, I gotta have a different mindset. I gotta do this in a different way. I've gotta develop volume in order to make any money in property management. So why do you need to embrace big a agency?
This is one of the reasons to make money, you need volume.
Speed for Volume
Now, number two, volume requires speed. You really can't process an application in an hour if you're not doing high speed. You've gotta learn to respond to a maintenance request within 24 hours. If a tenant is late on their rent by the eighth or the 10th, you need to file with the county for eviction. You need to be able to manage speed in your rent collection process.
You need to be able to process an application and do a move-in, in some cases within a day or two. So volume requires speed. If you're making pencils, you gotta make jillions of pencils in order to make any money. Why nickel dimes per a product? Well, property management is a nickel dime business.
So you've gotta develop some volume. And what people realize is they get to 60, 70, 80 doors. Now they need a full-time manager. So whatever money they were taking out is now gonna have to spend money hiring a property manager so they can get beyond that 70 doors and go back to listing and selling properties. So here's the formula.
If you are ever gonna, if you are in any form of property management, this is what, this is the poster that you should put on your wall in your office, okay? Formula for success in property management. How do you make this penny any business? Make it money. Okay, here's the answer.
It's a nickel dime business. Recognizing that you need, it requires volume. In order to have volume, you must be able to do things in high speed. You must be able to do a lot of, and our high point, we had 120 doors on the market for rent. We processed a hundred plus applications a month.
We did 50 move-ins a month. We had five full-time leasing agents in the north end of Atlanta, but we were managing a thousand, 1100, 1200 doors. So when you get that kind of volume, you need speed in order to do everything you need speed, speed allows you to scale.
Scalability Requires Big A
So right there, there's your formula for success in property management. Figure out a way to get that printed and put it up on your, put it up on the wall of your office. It'll help you recognize what you need because you must have speed to be scalable. Small. A agency prevents scalability.
There's another poster for your wall in your office. Small, a agency prevents scaling. You wanna scale, you gotta begin operating as a big agent. So why is it important to I embrace big a agency. Why?
Because small a agency prevents scalability. Now, if all you wanna do is hang in there, list and sell, manage 20, 30 doors, you can ignore this whole conversation because you can operate at a small level in a small a agency model. It'll wear you out. It'll make life very difficult. You won't make any money.
You might make money on sales. You won't make any money in property management. Property management requires volume. Volume requires speed, and you must have volume and speed in order to scale.
Cashing In Series
Now, one of the video series that we want to introduce to you is a video series called cashing in on Property Management, how to turn a nickel Dime business into a money machine. We've been thinking about this for 40 years. We had an active management business in Atlanta for 35, and so we've got this video series that we put together. You can find it training property managers.com/cashing in, or just go to our products page and find this graphic. You want to get, get a drip campaign every four or five days.
There are seven to nine minute videos. I know you don't have time for 20, 30 minute videos, and then we'll go through for probably six or eight months for how do you turn this business into a money machine? How do you make a cash cow out of a pan business? There is a small charge for that, but you can unsubscribe anytime. We're not trying to handcuff you into anything.
If you go a month and don't feel like there's any benefit, there's no problem. You're not losing much. Just a penny, any kind of thing. So watch this little one minute video and then we're done. Thanks for hand with us today.
