Have you ever noticed that when the supermarket takes a delivery of fresh milk they hide it behind the milk that has the use-by date sneaking up?
I don't know about you, but I always put the front ones aside and take a fresh one. When the use-by date is getting close to expiry, they'll reduce the price to a 'special' in the hope of moving it on.
On occasions I might be tempted to grab one of the old stock if they have the size I'm after, but the price needs to be really attractive, otherwise I'll end up to taking the fresh stock. There comes a point in time when you can't even 'give' the old stock away, no matter how much it's reduced.
This really demonstrates how important it is for property managers to remain on top of vacancies and rent reviews. Otherwise their managements, much like milk, will become stale.
Of course, what the smart supermarkets do is monitor their stock on a daily basis and reduce in small regular increments so that they don't get stuck will the old stock or, worse still, throw what was perfectly good milk out.
What happens next is that the customers stop coming and change suppliers (where they always have fresh stock on their beautifully clean, well-presented shelves).
Before you know it, the company with the old stock loses money, wages need to be cut, the business becomes stagnate, the milkman's orders get cut, etc.
This is a pretty painful experience for all concerned but mostly for the cow that produced the perfectly good, calcium rich milk, all because the managers didn't keep track of their stock and allowed it to become stale.
Some will say, 'yes, but my milk is flavoured’, but at the end of the day it is still just milk packaged differently and if it sits on the shelf too long it will become sour cream like all the rest. Not to mention there are plenty of uses for normal milk, but not everyone will like your flavour.
Remember, small regular incremental adjustments are a lot less painful than having to slash prices a couple of weeks later, but the adjustments need to be meaningful enough to have an effect. Ideally it should be just enough for a couple of thirsty people to have a little fight over, leaving one still waiting for some fresh milk.
Do it for the cows before they go out to pasture.
ABOUT THE AUTHOR
Matthew is a partner in @home Property Management and in his role as Letting Manager he is actively matching the right people with the right homes. His objective is to make the entire process of finding a home to rent with @home a pleasurable experience.
Having a number of commercial and residential investment properties himself, Matt is well aware of the needs of investor clients and tenants alike.
Matt is also the man behind the @home brand. His background in sign-writing & graphic design coupled with over a decade real estate experience (both sales and property management) enables him to market @home with a creative flair while reinforcing the brand with his exceptional people skills.