How Property Managers Can Increase Profitability
Updated January 5, 2023.
How can property management businesses or real estate companies increase profitability? While finding new clients can increase revenue, that doesn't always improve the bottom line.
There are many ways for property managers to increase profitability in their property management firms. One of the most important things you can do is keep payroll expenses low! Here are a few tips to optimize your business and maximize returns.
1. Reduce Compensation
Boosting profitability can happen when property management companies reduce employee compensation and benefits. However, that is not an ideal solution. Morale will be low, and your best people will leave the company while your subpar team members might stay. Without your best employees, customer service suffers, and you lose clients.
Building a successful real estate business requires the best talent in the business. To attract (and keep) experienced employees and team members, property managers must offer competitive salaries and benefits. However, what's "competitive" in the area where you work and serve clients doesn't have to be the benchmark for payroll budget or retaining good employees.
If your first thought to improve profitability is to cut salaries and hope people will stay, there are better ways to make your business more profitable!
2. Do More (With Less)
Another option to increase profits without reducing salaries is to have your employees do more. However, in a growing business, this can be difficult. There's only so much time in a day, and each employee can only handle so much work and serve your business and clients effectively.
However, there are some ways to help your existing team members do more by working more efficiently. Implementing the right property management automation strategies can help alleviate redundant tasks that bog your team down and leave clients without the level of service they need. Without dealing with tasks that an automated system can keep moving, your employees have more time to serve clients well.
While automation is an excellent long-term solution to optimize your business and reduce costs, it requires planning and the right implementation for success. When dealing with an immediate capacity need while focusing on better profitability for your property management company, a third option could be the ideal solution.
3. Outsource Labor By Hiring Virtual Assistants
Hiring virtual assistants is a great way to reduce payroll expenses. Virtual assistants are independent contractors and cost less to train and pay. Plus, most property managers and real estate professionals find that they save on operating costs when hiring quality VAs.
The right virtual property management assistant can also boost productivity for the rest of your team by taking over the more tedious tasks. Virtual assistants are skilled professionals who can take on various tasks, including customer service, data entry, social media and marketing support, coordinating maintenance requests, some remote property management services, and bookkeeping.
Outsourcing some or all of your team's workload can be an excellent way to improve profits without reducing salaries or hiring more people. By freeing up your in-house staff to focus on higher-level work that requires their expertise and training, you'll see better results for your clients and your business. You'll also experience better profitability!
How VAs Reduce Payroll Costs
Hiring virtual assistants greatly reduces payroll costs since the hourly wage for a virtual contractor is often much lower than that of a U.S.-based full-time employee. In many cases, property managers can hire three to four virtual assistants for the cost of hiring and paying one U.S. employee.
Outsourcing valuable tasks to experienced virtual assistants also help save money by reducing your office space footprint. For example, property management virtual assistants do not need office space, computers, cubicles, desks, or other office requirements that come with in-person employees. They are independent contractors with their own space and resources to deliver quality work!
How Can Property Managers Find the Right Virtual Assistant?
When shifting some of your operations to remote property management jobs, it's important to use the best resources to find and retain excellent VAs. Cost savings can happen quickly, but hiring a virtual assistant must be carefully planned to find and retain the best talent in the property management and real estate industries.
Using the VPM Solutions platform means a property manager can gain free access to the best talent for property management companies and real estate businesses. Not only do we attract the best VAs in the business, we know firsthand how hiring virtual assistants help reduce costs and improve profitability!
As a real-life example, we've put together a resource that tells the story of an actual company that hired VAs through VPM Solutions. They reduced payroll expenses from 52% of their revenue down to 34% of revenue—while increasing their overall headcount. They did not get rid of anyone in the U.S. Instead, they simply added skilled property management virtual assistants as additional contract team members!
Improve Profitability With a Property Management Virtual Assistant
Hiring more people can feel like you're adding more payroll costs (and getting further away from more profits). However, when contracting with a property management virtual assistant, companies reduce payroll expenses and overhead costs associated with large office spaces and equipment. This means that your business will be able to spend less money on things that don't directly contribute to the bottom line while still seeing an increase in productivity.
Getting started with VPM Solutions to expand your property management business is easy! Reach out to schedule a free consultation or start your free profile today.
We mentioned a free resource that's a great example of a company's experience hiring virtual assistants! Download "From Chaos to Clarity: A Virtual Assistant Impact Case Study."