It’s no secret that the economy is a fickle thing. One year you may be raking in the profits, the next you could be struggling to keep the lights on. While there’s no way to prevent economic downturn, there are things you can do proactively to ensure that if and when the market starts to go south, your property management company will be well prepared to ride out the storm. Here are a few tips for protecting your business so you’ll not only survive, but even thrive despite the grim market conditions.
Don’t put all your eggs in one basket
It’s great to have that one big property management client, but if you get too comfortable with that as your main revenue source, you could be setting your company up for disaster down the road. What if, when the economy takes a downturn, that one client decides to switch to another service provider or goes under completely? Your business might not survive. You can hedge against this risk by maintaining a more diverse portfolio of multiple clients.
Get a handle on cash flow
The last thing you want to happen during an economic crash is to be left holding the bag on uncollected receivables. Avoid this by getting your cash flow under control now and implementing the steps necessary to improve your debt recovery. This will place you in a much stronger position should the tides turn unexpectedly.
Cut your spending wherever possible
The more money you’re wasting now, the less stability you’ll have the next time the economy takes a dip. Protect your assets now by reducing your spending and cutting operating costs as much as possible. Leaner companies always tend to fare better during difficult financial situations, so get your property management business ready now, while it’s still in a position of strength.
Find ways to do more with less
You don’t want to have to lay off staff, especially those who have been loyal employees for a long time. You can prevent this by finding ways to get more done without the need to hire too many staff members. For instance, leveraging property management software to automate routine, repetitive tasks and other administrative activities will help keep staff numbers lean without impacting performance.
Don’t skimp on marketing
The marketing budget is often the first place companies cut back during a recession, but this is actually counter intuitive. In fact, to the contrary, the businesses that bounce back fastest are those that never stop marketing, despite the economic situation. By continuing to keep your property management brand in front of your audience’s eyes, you’ll be able to take advantage as soon as the upturn begins.
Most businesses are vulnerable during economic downturns, and the property management industry is no exception. In many cases, companies that have gone under could have easily stayed afloat had they simply taken a few precautions ahead of time.
The right time to protect your property management company from financial hardship is now. The steps above should help get you into a position to weather any storm.