Andy Moore on How to Maximize Your Profit
Andy is a long time client, friend, and consummate hustler. In today’s episode you’re going to learn about Andy’s unique approach to running a profitable business, how this strategy helps Gulf Coast get ahead, and how you can use some of these ideas to improve your own property management business.
- (01:13) – Background Leading up to Today
- (01:24) – Andy shares how he got started in the property management industry.
- (02:56) – What Gulf Coast looks like today.
- (03:49) – Breaking down the portfolio.
- (04:21) – Vacation Rentals
- (05:13) – Discussing the pros and cons of vacation rentals versus annuals.
- (06:02) – Why the portfolio model doesn’t work for vacation rentals.
- (06:43) – Breaking down the profit margins.
- (08:12) – The influence of online travel agents (OTAs).
- (10:06) – Andy’s advice for somebody who is considering vacation rentals.
- (05:13) – Discussing the pros and cons of vacation rentals versus annuals.
- (11:54) – Maintenance
- (12:24) – Andy shares his views on the opportunity that maintenance represents.
- (12:24) – Why internal maintenance is vital for vacation rentals.
- (14:45) – Discussing fiduciary responsibilities.
- (19:08) – The importance of demonstrating your worth to your clients.
- (21:05) – Andy gives advice on maintenance staffing and finding quality people.
- (25:04) – General rules of thumb for work orders per day and maintenance coordination.
- (27:16) – What Gulf Coast won’t do in terms of maintenance and why.
- (28:41) – General profitability of varying maintenance tasks.
- (32:21) – Andy walks us through their process of increasing maintenance fees and whether or not there was any pushback.
- (36:58) – Breaking down the numbers: expectations for maintenance profit margins.
- (39:19) – Discussing the relationship between the quality of a property and the ability to make money on the maintenance side.
- (12:24) – Andy shares his views on the opportunity that maintenance represents.
- (41:10) – Sales
- (41:23) – Andy shares his thoughts on sales, churn and capturing leads.
- (44:17) – Andy’s approach to training.
- (47:39) – How Gulf Coast has operationalized sales.
- (50:05) – Andy gives an overview of the Entrepreneurial Operating System (EOS).
- (53:38) – Structures and disciplines of the system that Andy uses with Gulf Coast.
- (55:57) – How long it took before EOS was fully integrated with Andy’s business.
- (1:00:29) – Who do you learn from?
- (1:03:42) – How does having a 14 year background in law enforcement help you as a property manager?
- (1:06:01) – If you could wave a magic wand and change one thing about our industry, what would it be?
- (1:08:00) – What’s one piece of advice you wish you could have given yourself when you first started in the business?
- (1:09:05) – Are entrepreneurs born or bred?
- NARPM – National Association of Residential Property Managers
- VRMA (10:26) – Vacation Rentals Management Association.
- Sandler Training Program (44:28) – Sales training methodology used and recommended by Andy.
- Traction: Get a Grip on Your Business; Gino Wickman (47:52) – Recommended learning and organizational resource.
- EOS: Entrepreneurial Operating System (47:52) – Organizational structure used by Andy.
- PM Grow Summit (45:31) – Property management conference to help you grow your business through world-class sales, marketing and technology tactics and strategy.
- The Great Game of Business, Expanded and Updated: The Only Sensible Way to Run a Company; Jack Stack – Learning resource recommended by Andy.
- EMyth (57:26) – Business coaching system recommended by Andy.
- Building Blocks: Building professional careers in property management; Ben White (57:36) – Learning resource recommended by Andy.
- Connecting the Dots; Ben White (57:36)
- What the Heck is EOS?: A Complete Guide for Employees in Companies Running on EOS; Gino Wickman (59:05)
Where to learn more:
If you would like to get in touch with Andy or find out more about Gulf Coast Properties, head on over to their website ChooseGulfCoast.com.
Jordan: 0:00:00.0 Welcome closers, today we have another episode of The Profitable Property Management Podcast coming at you. This is Season Three on profit.
I’m your host, Jordan Muela, and every week I interview world-class property management entrepreneurs and industry experts who share actionable insights to help you grow your property management empire.
0:00:18.8 Whether you manage 100 units or 1000, this broadcast is designed to help you see the big picture and to give you the tools and tactics that you need to get to the next level.
0:00:28.2 Today I’m talking with Andy Moore, the CEO of Gulf Coast Property Management, which has served thousands of Florida owners since 2003.
Andy is a long time client, friend, and consummate hustler. And in today’s episode you’re going to learn about Andy’s unique approach for running a profitable business, and how this strategy helps Gulf Coast get ahead, and how you can use some of these ideas to improve your own property management business.
0:00:53.2 Welcome to the show Andy.
Andy: 0:00:55.6 How are you Jordan? How are you doing?
Jordan: 0:00:57.5 Doing great. Hey, it’s fun to have you on. Known each other for a long time and you’ve kind of been on my list, and it’s taken me awhile to get you on the show. 0:01:09.9 But I’m finally glad to actually have you here.
0:01:13.2 There’s a lot that I want to cover, so I just kind of want to dive into it. I want people to understand the flavor of business, where you’re at, what’s the size and scope of the business, what kind of properties do you manage. Catch us up to speed.
Andy: 0:01:24.4 Ok. Yeah. Started my business originally in 2003. That was a property maintenance company. So then, serving owners who owned properties from out of state, or overseas.
0:01:40.1 We remained that way for a couple of years. I was cutting grass and cleaning pools. 0:01:46.0 Really dialing in on the vacation rental market.
0:01:51.9 We then took the maintenance and expanded it into renting vacation rentals and the actual annual rental side of the business – what we talk about in NARPM, wasn’t really on my radar until 2009.
0:02:09.8 2009 came along, there was lots of opportunities bouncing around regarding foreclosures, short sales, people being displaced.
0:02:18.3 So, we really got into the annual rental market in 2009. But we went for it. 0:02:27.9 And really changed the direction of the company in terms of recognizing the income that the annual rentals can bring in terms of recurring revenue.
0:02:45.1 It’s a steady business, we’re serving a need. And we expanded our portfolio. 0:02:50.3 And we’ve been doing that steadily now since 2009 right through to 2018.
Jordan: 0:02:56.0 And how many staff do you have?
Andy: 0:02:58.2 Staff on board? We have 20. It’s a – we have 20 full-time staff, different departments.
They’ve been here since – my longest employee, my director of operations, she’s been with me now for 12 years and with a sliding scale as it was growing.
Jordan: 0:03:23.6 So 20 staff, do you have an VAs in the mix?
Andy: 0:03:28.6 We don’t. It’s something we’re looking at. It’s just I haven’t found a way yet to utilize them. And we’re always finding things for people to do here. 0:03:38.4 So, it’s something on our radar but we really need to figure out how best to utilize VAs.
Jordan: 0:03:46.0 Alright. And how many doors are you guys managing right now?
Andy: 0:03:49.0 Between our vacation rental and annual rental portfolio, we’re just a shy over 650.
Jordan: 0:03:57.7 And what’s the breakout? What percentage of those are vacation rental?
Andy: 0:04:00.1 About 1/6th now. There was a little bit more heavier on the annual rentals, like 1/7th. So, 6/7ths.
0:04:11.6 Now we’ve caught up a little bit with the vacation rentals and we’re back up to 1/6th vacation rentals and the remainder being annual rentals.
Jordan: 0:04:21.5 Alright. So this is really interesting to me. 0:04:22.7 So, you start off with a maintenance-heavy focus and then you move on to vacation rentals. And then, you get to the single-family rentals.
0:04:30.9 So you have a pretty well-versed perspective, having done it. 0:04:34.5 The way that the conversation usually goes, either about maintenance or vacation rentals, is from the perspective of somebody that’s either hasn’t done it, or dabbled in it, or just kinda sorta thought about it. 0:04:47.1 But in many ways, represents a distraction and there’s just a lot of uncertainty.
0:04:52.3 You’ve done all three. Not in part, but in full measure. So, I’d love to kind of hear right out of the gate, your perspective, specifically on vacation rentals given that you’ve made annual rentals, as you put it, your primary focus.
0:05:08.5 How do you think about the opportunity and the pros and cons with vacation rentals by comparison?
Andy: 0:05:13.3 Ok, yeah. The – I’m surprised there’s not a lot of crossover, or more crossover than what we see. In organizations like NARPM. You and I have spoken at great length and I’ve tried to get you over to that side, but you’ve been reluctant to date.
Jordan: 0:05:33.0 Thanks for pointing that out Andy!
Andy: 0:05:34.5 And I do think there’s, I do think there’s huge opportunities if the company is set up in a certain way. I don’t think it works on a portfolio basis the way vacation rentals have gone.
0:05:48.0 But the companies who are in the right area and are set up in a departmental fashion, I do think opportunities are there and I do think those opportunities are only growing now.
Jordan: 0:06:02.3 Now why is it departmental versus portfolio? Why is that kind of a bright line for you? Just specifically with vacation rental.
Andy: 0:06:09.2 There is more of a clear definition between the sales and reservations rather than the leasing. The reservations is constant, it’s every day, it’s every week. You really need a sales arm, sales and leasing arm to it.
0:06:27.7 And then you need – there’s more moving parts in terms of operations, so you need a dedicated operations department, who perform the functions of the customer facing, whether that be a guest, or whether that be an owner.
Jordan: 0:06:43.5 And what do you see for the potential for the margins of vacation rental versus annual?
Andy: 0:06:49.4 The margins in vacation rentals eclipse those that are in the annual rentals. 0:06:57.2 I tend to think – the reason we 0:07:00.5 <Inaudible> to the annual rentals is it was – it’s feast or famine.
0:07:04.6 And we live in an area where – in Florida on the Gulf Coast, where we are very busy from December through April in terms of our occupancy and vacation rentals.
0:07:18.9 And historically, after April, a lot of these seasonal vacation rental properties would lie dormant. 0:07:28.0 The advantage of annual rentals is it’s every single month.
0:07:33.5 Your summer is likely your busiest period, so your leasing agents are busy in that period and there’s less of the ups and downs of revenue.
0:07:44.0 So, it allows you to forecast – the annual rentals allowed us to forecast and plan and really strategize about where we wanted the company to go. 0:07:54.1 Whereas vacation rentals, the rewards are there but they’re really stressful.
Jordan: 0:08:01.8 So, because you already have the year round labor on the annual side, it makes it easier for you to kind of handle that vacation rental side in the down season for the annual.
Andy: 0:08:12.5 Yeah, correct. And we are seeing more than – what 0:08:17.8 <Inaudible> I think vacation rental industry is good to be in especially now, is these big tour operators, the OTAs, the online travel agents, Air BnB, HomeAway, VRBO, Booking.com, they’re big in the space.
And they’ve exploded this vacation rental agency. 0:08:44.1 And it’s put it in the forefront of the public’s mind.
0:08:48.3 Whereas, previously, we would be dealing with legacy guests who have an expectation of a rental property of maybe $2-3000 dollars a month and when we’ve tried to increase our rates, there’s just been push back because of this historic perception.
0:09:12.3 What these OTAs have done, is bring a whole new set into the market. New customers, it’s a blue ocean, and the haven’t got this legacy opinion about pricing.
0:09:28.9 They go in comparing it to hotels. When we start talking to people about $200, $300, $400 dollars a night for a property, they’re not sidetracked from the historic price point. They’re comparing to hotels.
0:09:46.2 They see a three-bedroom, three-bathroom, whole home for $400 bucks a night. 0:09:51.1 You can’t get that in a hotel so they think it’s great value and we see very little pushback on price. 0:09:55.8 And that just pushes up our yield and our profits and those of our owners and customers.
Jordan: 0:10:06.0 Interesting. What’s one piece of advice that you would give somebody that’s in a market where vacation rentals are viable?
They may be considering it, but they already have a book of business in annual, traditional, single-family.
0:10:19.0 What’s one piece of advice you would have somebody considering getting into the vacation rental side?
Andy: 0:10:26.8 I would recommend – there’s a few things I would definitely recommend. Joining an organization. A similar organization to NARPM, but it’s VRMA. Which is the vacation rentals equivalent.
0:10:45.2 And approach some of your property owners, who as we see in the annual rental business at the moment, we are reaching a point where these accidental landlords are exiting the market or they are liquidating for various reasons. 0:11:05.9 Not all of them, perhaps, need the capital.
Or if you ask the questions, “What are they going to do with the capital?” 0:11:13.8 If the property is suitable for a vacation rental, it might be a way to transfer your property owner who is perhaps sick and tired of the low margins in an annual rental. They may be enticed into the vacation rental world. 0:11:32.1 And then it would also allow them to use the property as a vacation rental.
Jordan: 0:11:39.3 I’m feeling you. Ok, got it. So this could be a churn combator. The pitch is potentially revenue – a higher management fee, more revenue, and usage of the property. Ah, interesting. Ok.
0:11:54.9 Alright, so let’s move on to talking about some of the other components. Maintenance was the other one that we touched on. You have a lot of experience with maintenance.
0:12:00.8 Walk me through your basic view on the opportunity that maintenance represents.
It’s kind of a controversial topic, at least from the perspective of – you’ve got a lot of people that say, “You can’t make money on maintenance.”
You’ve got a smaller subset of people that say, “You can’t make money on property management without maintenance.”
Where do you fit in that conversation? What’s your kind of general view of the opportunity that maintenance represents?
Andy: 0:12:24.9 Ok. Yeah. I’m a big believer in maintenance throughout the property management industry.
But, again, pivoting back to vacation rentals, it is impossible to run a vacation rental company without internal maintenance.
0:12:41.7 I do not know of another company who has vacation rentals that do not have their own internal maintenance.
0:12:49.1 It’s guest expectations. Sky high. And with due cause. 0:12:54.0 They’re paying a lot of money to remain in the property.
So, AC going out on a Saturday evening may not be an emergency for an annual rental tenant, but it certainly is for a vacation rental.
0:13:09.6 So, you have to have the on-demand staff. 0:13:16.3 Because you’re trying to cram in someone’s week long or two week long vacation and their expectations are similar to those of a hotel where things are going to get fixed.
0:13:29.0 I couldn’t run a vacation rental management company without maintenance.
0:13:34.9 But, even in isolation, I think performing maintenance duties is part of a property management organization.
0:13:47.9 And I understand that people believe you can’t make money out of maintenance. There’s geographic challenges, there’s is uniformity of parts challenges. I get all of that.
0:14:02.6 But, what we used to do, and we weren’t always successful on our maintenance, because what we used to do was try and compete with the handyman price. 0:14:13.6 And if you’re doing that, you will definitely lose money.
0:14:16.1 So, we raised our prices significantly. We understand what now our cost of operation is. We understand the profit element of it.
0:14:26.0 So we raised our prices considerably. And then it’s a value prop to the property owner in terms of assuring them that the value isn’t necessarily in the dollar amount. It can be found in lots of other ways.
Jordan: 0:14:45.7 Ok, so the immediate pushback here is, the fiduciary responsibility right? Like, you know, so you’re saying your charge more money, but how is that in the best interest of your owners? Do you require your owners to use the in-house maintenance staff? Or do you allow them to bid it out?
Andy: 0:15:01.1 In our vacation rental management, we do require they use our maintenance staff, just because the perception is that the customer facing element of it is Gulf 0:15:15.3 <Inaudible> not the property owner.
And there are less fiduciary responsibilities because we’re licensed in a different statute. 0:15:28.4 So we don’t have that pushback.
0:15:32.0 Now, on the annual rental side, I understand the fiduciary responsibilities, but I think you can justify that by highlighting the intangibles and quoting maintenance issues, the friction this causes with delays. 0:15:54.5 The constant missed appointments by vendors. The time spent on turns.
If you’re looking at an annual rental property manager who doesn’t have a maintenance 0:16:07.9 <Inaudible> versus one that does, we’re actually in control of that turn. We can say with confidence that we begin advertising when a non-renewing tenant is not in the property.
Therefore, we could have a same day turn or a very short turn between tenants. 0:16:34.8 I think you can only do that with internal maintenance because they can work overtime, we’re in control of the situation.
We’re not going to be let down by a flooring guy, we’re not going to be let down by the painter not showing up.
0:16:48.0 So we can justify to our owners that way in terms of, “We don’t think you’re paying more if Joe down the road, your handyman, is able to do this for $50 bucks, look at the opportunity that we have in renting the property quickly. So, don’t necessarily focus on the dollar amount of the turn, look about the opportunity in rent that our maintenance program provides.”
Jordan: 0:17:17.7 So what’s interesting is the disposition of thinking that somehow, you making money on maintenance might represent some kind of a conflict of interest that is different than the management company making money in any other way. Right?
0:17:34.2 Because there’s various fees that are already collected. With any of those fees you’ve 0:17:38.4 <Inaudible>
Well is that in the best interest of the owner? Is it in the best interest of the owner for you to be profitable, Andy?
0:17:44.3 You know, maybe you should just run your business into the ground and operate on low profit.
0:17:49.3 So, that’s the part of the – to the extent that people are trying to make a quasi-moral argument out of it.
I mean, it’s pretty obvious what does violate a fiduciary responsibility. Things like – any kind of inappropriate non-disclosure, or mis-representing what’s actually going on in the business, etc.
0:18:14.4 But to the extent that you’re being transparent, at the end of the day, it’s a free market economy and situation where people are making a choicer to either pay more or less, as long as they go in informed.
0:18:24.1 So, I hear where you’re coming from, I think – what I find is that a recurring theme with a lot of different ways to make money in this business, is that the way that you approach it and the way that you explain things to your owners, is the difference between being able to command meaningful fees that allow you to have margin, versus not.
0:18:44.5 So what I find a recurring conversation is around, is it more worthwhile to lean into whatever you may have to do in order to charge the money you need to charge to run a profitable business?
Or, are you better off just ceding that fight and finding a way to live off of less? 0:19:03.0 Macro, in my mind, that’s kind of what it comes down to. Your thoughts?
Andy: 0:19:08.3 Yeah, I’m a great believer in getting in front of the problem and demonstrating your worth.
0:19:17.5 My father used to say all the time that people who know the price of everything know the value of nothing. 0:19:23.5 And in property management, never a truer word has been said.
0:19:28.4 We can – with data that we have available – we can demonstrate to property owners that maybe expenses are higher, but your net revenue is greater. 0:19:48.5 And we can show time and time again, how that’s the case.
0:19:54.5 We haven’t done a great job, in the past, of communicating, and that’s one of the things we need to improve on, is over-communicating our successes.
0:20:07.3 I was of the opinion that if you were doing a good job for someone, that was enough. They would recognize that.
But I’ve begun to learn that it’s not enough and you need to over-communicate your successes and demonstrate on a regular basis. Whatever that regularity may be. 0:20:28.4
0:20:29.0 But demonstrate on a regular basis and communicate what you’re doing for that property owner.
Jordan: 0:20:33.7 Oh, that is so good. I’ve heard it said that unacknowledged value is unrealized value. Exactly what you said.
It’s not enough to know in your heart of hearts that you’re doing right by the customer. That may be enough to allow you to sleep at night, but that’s not necessarily enough to run a business that’s growing, or that’s profitable, and taking the opportunity to remind the customer what you’ve done for them lately.
0:20:59.5 To allow them to have the satisfaction of appreciating and giving you full credit for what you’ve done. Absolutely critical.
0:21:05.0 Last thing on maintenance. Any words of advice around staffing? 0:21:09.9 Because that does seem to be one of the real pain points.
If you think about the barriers, what prevents people from getting into maintenance, given that it can represent additional revenue, staffing is like at the top of the list. “I can’t find good people. There’s a lot of turnover. Managing them is a pain.” Etc.
0:21:26.6 It’s interesting that some of that, kind of undertones there, has a blue collar subtext. When you hear people go off about this.
But what’s your view on what’s required to find the right people that will actually stick around and do maintenance well? On the tech side of things.
Andy: 0:21:41.7 Yeah, it is difficult. And the area that I live in, we are short staffed at skilled trade. It is boomtown here and all the builders are mopping up quality staff.
So, I’m not saying it’s easy at all. It’s just once you have them, you have to treat those employees like gold.
0:22:08.8 Now, we hire through the apartment industry. We found that’s a really good fit for us in terms of our maintenance staff.
0:22:20.1 So rather than employing the handyman type, it’s go directly to the apartments. We offer more, we’re involved in organizations.
We’re involved in the apartment association, locally. 0:22:37.2 We know when there’s turnover of staff. We know when there’s availability. We know what the going rate is. That’s how we find our staff.
0:22:46.1 Interestingly, I was at the National Apartment Association, there annual convention last year in Atlanta. And what they do for their maintenance staff there is amazing.
Each region has qualifiers ,and the final is at the national convention. And what this comprises of, is it’s small maintenance tasks.
They have timed maintenance tasks where they have – it’s within the convention, but there are bleachers, ten stations like changing locks, switching out fans. 0:23:34.6 Anything you can think about regarding what a maintenance – a turn guy would be doing.
0:23:44.0 Each station is sponsored by some of the big box stores like Home Depot, Lowes, and the recognition these maintenance guys get is incredible. 0:23:56.6 And the first prize is $25,000 dollars.
So, that’s – they’ve done a really good job of recognizing that the maintenance staff, they do feel isolated and they do feel that they’re out in the field and they’re responsible for the success or failure of the company, but they’re not recognized internally.
0:24:18.4 So, what we’ve tried to do is we recognize them. We buy them breakfast, we had an appreciation for our maintenance guys recently where they all go bought new lunchboxes, coolers, so that they don’t feel as isolated and ostracized and they do recognize that they are a very important part of our business.
Jordan: 0:24:43.8 Wow. I love it man. The inclusion, the recognition, making them a part of the culture. 0:24:50.9 Makes a ton of sense.
0:24:51.6 I’m curious, what’s your rule of thumb in terms of how many doors a maintenance tech should be able to service? And how many doors a maintenance coordinator should be able to manage?
Andy: 0:25:04.7 I think that depends on the structure of your company. What we see, in terms of work orders, whether it be reactive – if we concentrate on reactive work orders for a maintenance tech, our goal is eight work orders a day. 0:25:25.1 Of varying complexity. So that’s the goal that our maintenance techs are set.
0:25:34.0 In terms of the maintenance coordinator, we have one maintenance coordinator and she’s managing the internal maintenance issues.
0:25:49.5 We use a third-party vendor for the incoming calls. If there are – if the owner has specific maintenance instructions, then they will be directed then to the property manager and the property manager will organize those.
Whereas, if it’s going to be an internal maintenance issue, then our maintenance coordinator handles that.
0:26:18.2 So, with our properties, we’re ok with one maintenance coordinator. I don’t know how long that will remain, because she is getting close to being maxed out.
Jordan: 0:26:29.6 And what software is that person using to push work orders around?
Andy: 0:26:36.1 So we use AppFolio as our management software. We use Microsoft Teams for our internal communication and recording of work orders.
And then once that – our work flow will then go to our accounting department to process. And then it goes to the actual property manager for their portfolio to look at the – to inform the owner to process and approve.
Jordan: 0:27:16.3 What are the limits of what your maintenance department – specifically, what won’t you guys do?
Andy: 0:27:23.5 We won’t do anymore – so when it comes to what we’re legally allowed to do, is we’re legally allowed to fix pre-existing repairs or issues.
0:27:39.3 So, if there’s a blocked sink, if we have to take some piping from underneath the counter, we’ll do that type of plumbing. We’ll reset toilets. We will put in a hot water tank, if it’s not gas. 0:27:54.3 We’re allowed to do those within the auspices of handyman work.
0:28:01.2 What we take a decision to do, we don’t do appliances at the moment. Appliances, we used to fix washing machines, dryers, fridges. They’ve become so complicated, the control panels – it’s taken it out of our reach.
0:28:19.2 Looking at our maintenance schedule, there is a big part of what we do. 0:28:26.2 So the next hire that we make may well be an appliance guy. Because, depending on our growth, I think we could pretty much justify a full-time appliance guy pretty soon.
Jordan: 0:28:41.7 Interesting. So, you’re saying you’re not doing it currently because it requires a specialized skill set. Have you done any analysis of the general profitability of any categories or types of maintenance tasks? Bigger or smaller jobs, etc? How do you think about that?
Andy: 0:28:59.2 Yeah, we have. Full disclosure, we ran our maintenance department at a loss from about 2012 to 2015-16, because we were trying to be everything to everyone.
And the difficulty with single-family over the multi-family is there’s no commonality of parts. You’ve got geographic challenges and when you’re keeping vans on the road, you have to maximize their productivity.
0:29:37.1 And once we started analyzing, we went down to a productivity of about 45% a day. And it was killing us.
0:29:48.5 But, we weren’t really analyzing the data. It was only after we analyzed the data that we could actually see that – where our frailties were.
0:29:57.8 When you’re bootstrapping a business, cash is king. Cash was coming in and it all looked rosy.
0:30:04.1 But once you take a step back and look actually where you’re – the sectors you’re making money, the sectors you’re losing money, it was frightening.
0:30:10.9 And so, we actually put a halt to our maintenance, took a breather and reassessed. We then increased our prices. Pretty much overnight.
0:30:21.6 Which was a brave thing to do, but we had to justify it to our owners of why we were doing this.
0:30:30.0 And then we just said, “Look at the work we can do. Let’s count our historic call backs, and anything that we were getting call backs on, we would say we’re not doing that.”
0:30:41.2 And so, a lot of the time it was ACs and appliances. They were the main things that we would go to.
We wouldn’t be able to diagnose effectively, and then not being able to charge the owner for a non-diagnosis, we would then call in an AC specialist and that would just go down as lost revenue. Lost opportunity.
And we’ve just paid one of our maintenance guys a couple of hours to go and fix something that he wasn’t able to do and then we weren’t able to charge for it.
0:31:11.7 So we put a halt to those kind of calls and have just slowly drip-fed what we can do.
0:31:17.8 And our maintenance coordinator is very good and she’s very analytical. And then we’ve broken it down into segments so that once we get a diagnosis, we have a good idea of whether or not we’re going to be able to solve that problem.
Jordan: 0:31:32.7 I love it. So, when you mentioned the call backs, that’s like classic lean manufacturing. Right?
Reducing the amount of rework, lowering the average number of touches required to get a job done.
0:31:44.6 Prior to that you mentioned just an across the board increase of prices. Walk me through that. Right? This is really juicy.
Anytime we have the conversation about revenue optimization related to increasing profits, where the rubber really meets the road, is not listing out the 500 fees.
0:32:03.1 We can all brainstorm around fees. It’s getting over the fear of actually putting it in practice and wondering what’s going to happen.
0:32:10.0 So, you pull the trigger. How did you craft the language in communicating to owners? Was your staff concerned? What was the fallout? Was there any pushback? Walk me through that.
Andy: 0:32:21.0 Yep, yep. Obviously the staff will concerned. They’re the ones that feel the brunt of the frustration from property owners.
The – once we’d analyzed the data, we can’t compete with an owner-operator, one-man-band, who doesn’t have to worry too much about workers comp or insurance or benefits.
0:32:52.5 So their cost of operation is so low. And that’s where I believe this $45 buck an hour, $50 dollar an hour, handyman rate comes from. 0:33:03.8 And that’s what we were competing with.
0:33:07.0 Unbeknownst to me at the time, our actual global cost of operation was $56 bucks an hour. So, by sending a maintenance guy, just employing a maintenance guy, regardless of their productivity, even if they were hitting 100% productivity, we were still losing money.
0:33:30.7 So, once we’d recognized that, we set our rate on our cost of operation. 0:33:39.1 So, we know what we’re looking to achieve, profit-wise.
We know what our costs of operation are, and we know what a reasonable, productive day looks like for a maintenance tech.
0:33:50.1 And once we’d assembled that number, we came up with the number we have to charge for maintenance issues.
0:33:56.7 Now, we approached our owners with that and said, “Mr. Owner, this we’ve been operating our maintenance company at a loss. We’re unable to do that any longer. Our new rates are going to be this, however, you are not required to use our maintenance services. We don’t mandate that you use our maintenance services. And you have a choice. What would you like to do?”
0:34:25.7 And the fallout of it was incredibly low. I think by getting in front of the problem, being honest, being transparent, and explaining to our property owners what we were – the challenges we were being faced with, either they ignored the issue, there was some apathy, there wasn’t that much engagement, or many people were, “Ok, we’ll stick with your maintenance services.”
Jordan: 0:34:55.9 Do you remember, I mean could you count on one hand the number of people that – did you lose any management contracts over it?
Andy: 0:35:02.4 No, no. We didn’t lose any management contracts over that. I mean, there is churn and there may be – I think I’d be naive if I said it might not have been a deciding factor or tipping point for some people.
0:35:20.4 But we didn’t see an uptake in our churn as a result of changing our maintenance fees.
Jordan: 0:35:28.4 Got it. So nobody complained loudly and then immediately walked out the door. That’s good to know. 0:35:33.3 What was the increase? Was it 25%? 100% How much was the relative increase?
Andy: 0:35:39.4 It was close to 90%.
Jordan: 0:35:41.0 Oh wow. Wow! Wow. That’s inspiring Andy.
Andy: 0:35:49.1 Yeah, but it was a case of: We couldn’t do this any longer.
Jordan: 0:35:54.2 All the more reason.
Andy: 0:35:59.4 But the more successful we became, and the more – it just meant we were going to be losing more and more money.
Jordan: 0:36:05.8 A victim of your own success.
Andy: 0:36:06.8 Absolutely. So, we had to get in front of the problem. We did that, and we were very fortunate that there wasn’t any pushback, or any real pushback at all.
Jordan: 0:36:18.1 I’m really digging this. So, the benchmarking study that we did going inside of 50+ companies’ books, this is one of those situations, talking to Andy Moore, could have been, “Yeah, you know, maintenance, you just can’t make any money there. You’ve just got to eat it. You just got to take a giant loss and make your money up on property management.”
0:36:36.8 That was the story for awhile and that could have been the story that you held to in perpetuity.
But you chose to take action, you chose to do the analysis. The approach of change was cost plus. Like, what’s your cost structure, what kind of profit margin do you want to make and then anchoring around that based on the assumption of utilization.
0:36:58.2 What is your expectation? If you were at a bar at an NARPM event, talking to some other owners that have a full-blown maintenance company, what would you kind of set as an expectation for what somebody that’s doing this well, should be looking to make in terms of operating margin within the maintenance side of the business?
Andy: 0:37:18.8 Yeah. That’s an excellent question and I know our numbers based on our figures.
So, if the – we build in to our model a 10-15% non-operational, going to the hardware store, the productivity of our maintenance staff cannot be 100%.
0:38:04.5 So, with our cost of operation in maintenance, compared to what we charge, we’re looking at a 30% gross profit just on our maintenance. 0:38:19.1 That’s where we’re trying to reach.
0:38:22.7 But once you build in the limited amount of callbacks that we have and some free compensation to perhaps a vacation rental guest, that brings that number down for us to about 17%.
0:38:43.9 Is where we’ve been at now for the last year. 0:38:48.4 We’re trying to increase that and trying to increase our productivity.
0:38:53.9 Geographic scale is going to help that. So that the – having depth of properties within zip codes is going to cut down on our travel time, which is going to increase the productivity of each tech. 0:39:13.2 There will be less down time. 0:39:14.2 So, we’re hoping to push those numbers up to the mid 20s.
Jordan: 0:39:19.8 What is the relationship between the quality of properties that you manage and your ability to make money on the maintenance side of things? Do you think that there’s a direct relationship there?
Andy: 0:39:32.3 I do. It’s not coming from any point of expertise or data, in terms of what I have in front of me. 0:39:41.7 But there – we have a lot of new build in this area.
So, bringing a new property on, the maintenance, required in that property is going to be minimal. 0:39:59.2 So, the older properties that we have, that’s where we see the bulk of our maintenance work orders going towards.
Jordan: 0:40:09.0 Interesting. Yeah. Huh. Kind of an inverse relationship there then?
Is that what I’m hearing you saying? If you actually – if you manage lower quality properties, it’s going to have a negative impact on your ability to make money on the management side of the business.
0:40:24.3 I think we can just kind of use that as an operating assumption. 0:40:26.5 But, there’s more potential revenue to come in for maintenance. 0:40:32.1 Interesting relationship there.
0:40:32.4 Well, let’s move on from maintenance. We’ve spent a fair bit of time talking about that. Those are definitely some unique insights. Guys, for those of you listening in at home, it’s worth just continuing to look at maintenance as one additional revenue center.
It’s relevant, because of how closely aligned it is with the business. But at the end of the day, we’re just talking about another way to make money. Another revenue center within the business that’s directly aligned with service delivery.
0:40:57.5 At the end of the day, whether or not you handle in-house or if you’re outsourcing, you’re still doing it. 0:41:03.9 Whoever shows up at that person’s house and knocks on the door is representing your company one way or the other.
0:41:10.3 I do want to talk a little bit about the sales side of the business. How do you handle sales? As properties are churning, are you capturing a meaningful number? How do you think about the sales piece of the business?
Andy: 0:41:23.9 We have been. We have been capturing. A lot of pocket listings. Owners selling and then bringing in new investors into the market. 0:41:33.5 And handling their transaction in-house.
0:41:37.4 We do – have been listing properties. My leasing agents, they’re licensed, so they have been listing some properties.
0:41:48.3 It’s been good for revenue, no doubt. It’s closing the circle, I guess, in terms of a lifecycle for real estate property management real estate. 0:42:00.3 Whether or not we continue to do it, it’s unlikely.
0:42:06.6 I’m – as a revenue piece, it’s been significant but not critical. And I do think that the bigger opportunity is going to be in property management as we move forward.
0:42:19.7 And not competing at all with the traditional real estate agents. 0:42:26.0 Leveraging those relationships.
0:42:29.9 And then, if we do have the opportunity to have some pocket listings, we will certainly continue to do that.
Jordan: 0:42:38.8 Got it. Alright, let’s talk about the other sales side of the business. I.e, owners. What is your approach to sales? I know we’ve talked about this in the past.
There’s kind of a hierarchy or graduation of awareness in the sales process. It starts off with everybody just doing sales themselves and hustling and putting their best foot forward.
0:43:01.0 And over time, more shape is formed to what’s unique about your specific selling process, your pitch and how you sell.
0:43:12.0 So, in a nutshell, Andy, how would you describe your approach to sales?
Andy: 0:43:18.0 Yeah, well I’m a great believer, and always have been a great believer that people buy they’re not sold.
0:43:27.5 So, I think it fits right in with the current message that’s going out that we should be consultant and we should be a trusted advisor and we’re moving away from the traditional car sales method of selling.
0:43:45.8 So, that’s the way I’ve always tried to sell and I like selling. It’s something that I personally enjoy, and I’ve been the sales driver for the company since it started.
But then, as we grow, bringing in a BDM and making sure that we fund the marketing and sales department to reach the revenue goals that we’ve set ourselves.
Jordan: 0:44:17.1 So, when you talk about funding, part of that obviously relates to training as well. What’s your approach to training and oversight with your BDM?
Andy: 0:44:28.1 So, anyone involved in a sales capacity in my company, whether they be a leasing agent, a reservationist or the BDM or marketing, we put them through the Sandler Training Program. 0:44:42.5 It’s a good grounding. It gives them a really nice insight into how we want to sell.
0:44:53.6 So, once they’ve accomplished that, then we – regular meetings, regular sales meetings within the office.
0:45:04.3 I was listening to one of your podcasts recently, and you had mentioned something about the successful companies are not necessarily the ones with the best product or service, it’s the ones with the best marketing and sales.
0:45:19.7 And I absolutely believe in that. You can have the greatest thing on Earth, but if you are not able to convey it’s value, it doesn’t matter.
0:45:31.1 So, really investing in our sales team, whether that be the Sandler Training as I mentioned, going to the PM Grow Summit.
I took three staff members to the PM Grow Summit to give them an introduction into what this industry is about and how we want to present our sales in this industry. 0:46:00.0 So yeah. Absolutely investing in that area of the business is critical. 0:46:02.4 And it just helps that it’s something that I particularly enjoy also.
Jordan: 0:46:06.4 Yeah, absolutely. So, I love the fact that you invest. I love the fact that you’re doing Sandler.
At the end of the day, Sandler represents an intentional approach. It is one program. I can’t say I’m that familiar with it. I definitely know of it. 0:46:19.0 And I know a number of people that have gotten good results from it.
0:46:21.4 But it doesn’t really matter what program you use. The point is that you’re recognizing that for sales to be successful, it has to be operationalized.
0:46:29.3 Meaning it has to have equivalency with all the other aspects of the organization, whether that be leasing, maintenance. Whatever it may be, the assumption that we make is that this is a job that has specific tasks that requires training, oversight and management.
0:46:46.8 And yet, when we get to sales, a lot of times that metaphor breaks down, and we think, “Man, we just need to find a guy with the juice.” Right? The guy that can just do that dark art. He’s got that charismatic – he or she has that charismatic disposition and they’ll just kind of do it if you find the right person.
0:47:03.0 That breaks down very, very quickly. Particularly once you commit to a comp structure that is not going to pay the person that has that amazing skill set of producing something from nothing.
If you’re not going to pay that kind of a person what they’re worth and you’re looking to pay more like $30, 40, 50, you’re probably looking to hire an order taker. And that’s ok as long as you have inbound lead flow.
0:47:31.5 So I love the fact that you’re committed to intentional training. You mentioned having a sales meeting as well. That’s the ongoing management oversight piece.
0:47:39.1 What is the cadence of your meetings with your BDM? What do you discuss? And how do you continue to know whether things are going wrong or right? And more importantly, how do you understand the ‘why’ behind that result?
Andy: 0:47:52.2 Yeah, so the – our whole company – you talk about cadence of meetings. Our whole company, we’ve been using the EOS Traction structure now for a couple of years. 0:48:07.0 And departmentalized our sales and marketing.
0:48:10.9 We meet every single week. We have scorecards, we have leads. So we measure our leads, measure our conversions.
Measure our – did we lose to competition? How did we lose to competition? Why did we lose to competition?
0:48:30.2 We have an ongoing nurturing program that’s between Fourandhalf and LeadSimple. 0:48:39.3 It’s been just blown out really and we know think 18 months worth of content going out to owners that didn’t necessarily 0:48:47.9 <Inaudible> right away. May have lost. 0:48:52.6 But cycling back to them all of the time.
And we’re picking up a fair bit of business from people who we haven’t – didn’t catch the first time around but we’re catching them maybe the second or third time.
0:49:03.1 I have daily standup meetings with my BDM in terms of where we’re at. 0:49:08.3 Keeping him on track.
He is a – he’s really bought into the vision of Gulf Coast. He’s come through the ranks here. He started as a pool guy. Worked in reception. Then worked in vacation rentals sales. He then became a real estate agent and he had a really good year in terms of sales and leasing and then we had an opportunity as I was transitioning out of the BDM role into the more strategic position, he stepped in. 0:49:49.6 He was sold on the vision and he’s going great 0:49:53.7 <Inaudible>.
Jordan: 0:49:56.2 Love it. Awesome. I love the intentionality of what you’re operating there. I love the fact that you’re staying in touch and that you’re continuing to aggressively manage that side of the business.
0:50:05.4 You brought up EOS, so let’s take things full circle there. EOS, Entrepreneurial Operating System, has gotten a fair bit of air-time over the last couple of years. 0:50:18.0 Specifically in our industry.
We’ve kind of talked about it briefly in the past, but for those that are not familiar, can you just give a cursory overview of what exactly is EOS and why is it something that you have found worthwhile to implement?
Andy: 0:50:33.5 Yep. The property – I fell into the property management business the same way as a lot of people do.
0:50:43.0 It wasn’t so deliberate. I started the company because I owned a property and couldn’t find a service provider and it led me to where I’m at now.
0:50:54.4 And I think a lot of people in our industry are like that. And as a result of the – our industry being so dominated by real estate companies or realtors, or real estate brokerages who have a PM arm to them, they run their businesses by – they’re independent contractors run their own book of business and portfolios.
0:51:26.3 And I’ve always had an issue with that. I wanted to build something more than that kind of real estate empire. I wanted to build a company.
I wanted to affect people’s lives, give people a career path, and so, I’ve always wondered why we look at property management differently to other industries.
0:51:54.5 Because to my mind, if you own a business or you run a business, those skills are transferable and those business principles exist no matter what you do.
0:52:05.1 There may be a difference between manufacturing and the service industry, but if we use a service industry example like an air-conditioning company or a roofing company, then they will have a sales arm, they will have an operational arm, and then they will have an accounting and HR arm.
0:52:25.2 And I was determined to find a way to get to that spot and EOS has helped me get there.
0:52:36.2 So, we now have real clarity in where the company’s going. You are recognizing people’s skill sets for what they are, and you’re not giving someone who is intentionally transactional and the lifecycle of their customers are very short – you’re not putting them in charge of an account where they’re in constant communication of an owner, constant communication to a tenant and managing expectations.
0:53:08.0 Because that’s not their skillset. Their skillset is closing deals and they’re working on the short-wave not the long-wave.
Jordan: 0:53:18.9 Got it. So, for those that are kind of looking at EOS and wondering, “Is this another fad? Another book that I could read but I’m only going to implement a fraction of?” Could you walk through some of the structure or the disciplines that EOS talks about that are fairly concrete?
Andy: 0:53:38.3 Ok. Yeah. So, we have a vision for the company. And leadership team will sit down, or we did sit down and we outlined where we want to be. 0:53:59.0 And where that be a ten year, five year, three year, a one year goal.
0:54:04.5 So, once that’s established, then it’s putting the meat onto that frame. As in, how are we going to get there? What core values do we have as a company? What core values do we have when we are looking at hiring people to fill the spaces that we have?
0:54:27.4 So, that is a long-range overview of what do we want the company to look like. What are going to be its goals, its skills, its attributes.
0:54:42.0 And then, you bring that down to an annual meeting with your leadership team. Quarterly meetings with your leadership team. Then you have your departmental weekly meetings where there are clear accountabilities that are set.
0:55:02.8 We have scorecards, we have todos, we solve issues within each department. 0:55:09.3 And then, as a company, we meet quarterly. We use open book accounting.
We show our staff where we’re at. 0:55:18.1 We show our staff where we have made budget where we haven’t made budget. What we can do better.
0:55:27.4 There is, to use your word cadence – there is a pulse to what we do. I was in a meeting recently that we weren’t using traction. And I just felt lost. There was no direction in the meeting. It was rudderless.
0:55:46.8 And it’s made me appreciate even more what the disciplines of EOS can bring to an organization.
Jordan: 0:55:57.4 In terms of actually getting the velocity to where it felt like it was working as intended, what was the ramp up? How long did it take before you felt like you really hit your stride with it?
Andy: 0:56:10.0 Well, we had been – I’ve listened to your podcast hundreds of times now and everyone you bring on – anyone who is listening – the other day to Mathew Whitaker. 0:56:26.9 I mean, I echo his sentiments in terms of what Traction can bring.
We were implementing a lot of these principles. I read a long time ago, a few years ago now, I read a book called, The Great Game of Business. 0:56:48.8 I don’t know if you’re familiar with that.
It’s by a guy called Jack Stack, and he turned a manufacturing company around, and he did it by 0:56:58.3
0:57:01.2 He did it by open book accounting, clear accountabilities, showing people what they – the fruits of their labor. 0:57:15.2 What the knock on effect of their efforts meant.
And that opened my eyes initially, and then I kind of followed that up with the EMyth 0:57:26.2 . Then, into Traction and building – looking at some of Ben White’s books.
The Building Blocks, and Connecting the Dots. 0:57:36.6 All of those – we were doing all of those things, but we didn’t have any real structure.
0:57:42.5 I knew where I wanted to take the company, but I didn’t have the tool in which to do it. And then what Traction did, it gave me the tool and the fabric of how to organize meetings, how to set goals and how to deliver the message.
Jordan: 0:58:00.3 So you already had some momentum. You weren’t starting cold. Right? Like, to start cold would basically be a situation where you the property manager, you’re doing everything. You made one hire, and you made two hires.
0:58:13.7 All the momentum that you had was purely just to get things done. 0:58:18.6 There was already some level of thoughtfulness going on, and it sounds like EOS just kind of crystalized – it was the answer that you were looking for prior to that. 0:58:27.6 Is that fair to say?
Andy: 0:58:29.3 Yeah it is. It really makes sense, and using the EMyth – the content in the EMyth is just invaluable. And if someone’s looking at starting any business really, the EMyth is just a fantastic resource.
0:58:48.8 What Traction did, and how we implemented it, the guy Gino Wickman who wrote Traction, he came out with – he’s come out with several books.
But one of the books that he implemented is, What the Heck is EOS?. 0:59:05.0 And it’s from a – it’s explaining it from an employee’s point of view. And we bought all of our staff that book.
And we had them essentially write a short essay on – like a book summary on What the Heck is EOS? 0:59:28.7 And that’s how we implemented it in terms of – to the company.
So that’s how we introduced it. 0:59:36.9 And that was valuable. It gave people a clear indication of what EOS was. Rather than it just coming from myself or the leadership team.
Jordan: 0:59:48.9 Yeah. Love that. So that’s all in. At the point where you’re asking your staff to write an essay on a given topic, it’s fair to say that you’re all in.
0:59:56.3 Well, no more time to talk about EOS, but it’s definitely a topic of interest. I’m about half way through the Traction book that you mentioned. It’s come up more and more, so it’s definitely something I’m interested in looking at.
1:00:08.7 But whatever the structure is, whether it’s that, whether it’s Scaling Up, by Verne Harnish 1:00:14.0, whatever the methodology, is to introduce some cadence and structure into the business is what’s key.
1:00:20.0 I do want to just transition now to the rapid-fire section of the interview. I like to end each interview with a series of questions where I’m just looking for an answer straight from the gut. 1:00:29.6 And the first question is this, Andy who do you learn from?
Andy: 1:00:37.3 I learn from – it’s easy, – I learn from everyone we meet within this industry, but then I go outside of the industry.
1:00:55.5 I think there is a temptation within our industry to surround ourselves and say that property management is unique in what it does.
1:01:09.2 But I pretty much guarantee that if you went to a Xerox convention, those guys will be around the bar saying how unique their business is.
1:01:18.5 I think all businesses are the same and so what I try to do is get outside of our industry, aside from the education.
1:01:29.0 So, some networking events. I have a mentor. I have a coach on the training side. I listen to him and bounce ideas of off him.
1:01:39.9 So, it’s probably not the clarity you’re looking for in an answer, but if I tone it down, it’s just not people within this industry.
Jordan: 1:01:50.7 I love that man. That is such a good answer. And I so feel you on that. I just got back from an insurance conference for independent insurance agents in Cleveland. Put on by a guy named Ryan Hanley who I’ve had on the podcast.
1:02:08.2 And my life has nothing to insurance and it’s not particularly interesting to me. 1:02:11.2 But what is interesting is that that’s an event where it’s the same idea of what we’re trying to do at PM Grow.
1:02:16.8 Taking high-level, best in class thinking, and applying it to a specific niche in a specific vertical.
1:02:24.7 Independent insurance agencies happen to have similar dynamics in terms of property management. At least the selling component. They’re small businesses. Average transaction value. Sales complexity, etc.
1:02:37.1 So I had plenty to learn and I got a ton out of it. I’ve been to real estate conferences before.
1:02:44.8 So, while it’s great to go upmarket and to just look at entrepreneurship generally, it’s also worthwhile to look at the specifics of other adjacent verticals. 1:02:54.5 Whether that’s mortgage, real estate or whatever it may be.
1:02:56.5 And Andy, I got to tell you, there’s nothing sadder and more disappointing to me than to meet somebody in the property management space that is towards the top of the food chain.
They’ve reached a certain level of accomplishment and they’re celebrating because they think that being at the top of the food chain in this industry is somehow, like some kind of a life achievement award.
1:03:21.2 It’s worthwhile, it’s commendable, but if you get to the top of the valley that you’re climbing and you don’t realize that there’s another peak ahead of you and you just want to sit on that plateau and celebrate? I think it’s small minded.
1:03:36.5 So, I’m definitely with you. I appreciate you highlighting that fact. 1:03:40.4 So, it’s a satisfying answer for me.
1:03:42.7 The follow up question is, how does having a 14 year background in law enforcement help you as a property manager? Have you gotten any benefit from that?
Andy: 1:03:51.9 Yeah, absolutely I have. The one thing the police taught me, from a small level, I guess, is that not everything is an emergency. 1:04:08.1 And it gave me some perspective in terms of life and death.
1:04:13.0 In property management, whether it be a tenant who has an issue, whether it be an owner who has a concern, or a guest showing up to a vacation rental and the pool isn’t as clean as they want it to be. To them, it is an emergency, whereas I have some perspective about what an emergency is.
1:04:37.2 So, I’m not saying I’m unflappable, but I don’t take everything they say to heart. I don’t take it personally, and there is a degree of reality in my mind.
1:04:53.6 And then the second one is, the sales aspect of it. I was a detective for quite a number of years, and most of what you’re doing when you’re a detective is interviewing people.
1:05:08.1 I equate interviewing into sales. You have to be quiet, you have to ask the right questions. There are interview techniques that are equally applicable to it. A criminal investigation as they are to a sales presentation. And so, asking questions, discovering the truth, reaching down into the person to see what their pain is. 1:05:41.5 And you can only do that if you can learn how to ask the searching questions.
Jordan: 1:05:47.0 Now that sounds like a helpful frame of reference. “I’m the one that’s going to be asking here Mr. Prospect.” 1:05:55.5 I love that. That sounds entirely useful. I’m sure there’s a bunch of other stuff we didn’t even get to cover in that answer.
1:06:01.4 Third question for you, if you could wave a magic wand and change one thing about our industry, what would it be?
Andy: 1:06:11.6 Personally, it would be a distinction between real estate agents and property managers.
I believe that the real estate agents – I mean, I’ve got stats. There’s 75 in our area, we have a population of just over 700,000 and there are 7500 realtors. It’s ridiculous.
1:06:52.0 It’s like something – 1 in 84. When you calculate volume sales, it works out to be gross commissions, $23,000 per agent.
1:07:04.6 And it takes from what we do in this area. It takes from what we do in terms of the professionalism.
Anyone can lease a property. Any agent can lease a property and then that gives the property management – if they’re not doing it particularly well, it gives our industry such a bad name.
1:07:22.9 And I think if there was a separation, whether it be a separate license in Florida or nationally, for property management, I think it would do wonders for our industry.
Jordan: 1:07:38.2 I love that answer. I don’t think you’re going to get any pushback from anybody listening to the show right now.
1:07:41.4 Yeah, that’s great and certainly we all just kind of gutturally intuit, knowing that a specialist, somebody that actually has a real focus, as opposed to just an opportunistic basis, grabbing some low hanging dollars. We can intuit what kind of results are going to come from that.
1:08:00.1 What’s one piece of advice you wish you could have given yourself when you first started in the business?
Andy: 1:08:08.7 I think treat it as a business is what I could have looked back with some regret. I was – the first part of ten years – my 30s were just lost in terms of head in the trenches, just trying to grind it out and I wasn’t looking at it from a strategic perspective.
So, treat it as a business from day one. 1:08:42.1 And the second thing I think we’ve commented on is over communicate what you do.
We went for so long in terms of thinking we were delivering a good job, but the owner’s perception – the two just weren’t aligned. 1:09:00.7 So, working hard now to over-communicate success.
Jordan: 1:09:05.4 Love it. Final question of the day. You know this one was coming. Andy, in your opinion, are entrepreneurs born or bred?
Andy: 1:09:16.7 If you have to fall on one side, I would say born. Because I think it’s a risk factor element. And that’s what entrepreneurs have is, is a built in – whether it be an attraction or prepared to risk things, whereas without that risk tolerance, I don’t think people would take the first step towards being an entrepreneur.
Jordan: 1:09:52.0 Yeah. Risk tolerance. You know, what resonates on this side of the answer, is also the pain tolerance. Right? Just like, the willingness to embrace ongoing suffering for an indefinite, unknown period of time.
That’s a hard thing to teach in a classroom, right? 1:10:10.1 Well Andy, I really appreciate you coming on the show today. If folks would like to get in touch or to learn a little bit more about your business, where’s the best place for them to go?
Andy: 1:10:20.6 The best place is our website, which is ChooseGulfCoast.com. It’s a standard website for property management. We’ve got owner articles on there and a learning center and you might be able to pick up some tips about how we do business on that website.
Jordan: 1:10:41.3 Yeah guys, I actually recommend going to his website right now. Andy, this is a really baller website. Like the conversion flow. I’m loving the video on the home screen. 1:10:50.1 That alone is worth checking out. ChooseGulfCoast.com. Andy, thanks again for coming on the show, let’s stay in touch.
Andy: Yep, will do Jordan. Thanks a lot for having me.
Jordan: My pleasure.