To scale up, property managers need to implement the right systems and remain patient, especially in the early stages of business, according to an industry leader.
NU Management director Grant McKay sat down with host Alex Whitlock on an episode of The Property Management Excellence (PMX) Podcast to discuss the early stages of founding a business and the importance of a positive public perception.
Despite having almost two decades of industry experience, McKay said that starting a new business from scratch was challenging, requiring him to build a new name and reputation.
“For the first year, it’s tough because activity creates activity, and when you’re starting out, there’s no presence,” McKay said.
“No one knows you apart from your own contacts.”
McKay said that when it came to scaling the business upwards, the first 50 properties under management were the hardest.
“That first 10 to 20 was difficult and felt really slow, 50 to 100 was definitely a lot easier than 0 to 50.”
In the early stages of growing the business when he was operating solo, McKay said he struggled more to maintain service quality as the number of properties under management increased.
He said that when trying to find the right staff to work alongside him, McKay understood he would have to dedicate significant time to training them, though no prior industry experience was required.
“I was on the hunt for the right person because I thought ‘I can’t go out there and advocate something different’ if I am dropping the ball all over the place.”
“I wanted someone who was excited about the startup, excited about my philosophy of offering good service not just to landlords, but to tradespeople and tenants.”
The systems of successful scale
McKay said that when he first began scaling his business, he took a slightly unusual approach and opted to forgo a trust account.
“They were just parts of the industry that to me just felt very outdated,” he said.
“It just seemed like a lot of work.”
In addition to being a time-saver for the business, McKay said that another advantage of using a no-trust accounting program was that it offered enhanced protection for both the agency and the landlord.
He said that by removing the trust accountant's role and using an instant payment platform, he could eliminate the risk of embezzlement.
As the number of properties under management and the need for staff members rise, McKay said it was important to maintain the stance of hiring the right people for the company and not rush into a partnership that doesn’t work.
“At the moment, I definitely need another property services person with the scale of growth.”
“Even if I’ve got to invest in the right people to manage that growth, I’m not reactive to it.”
McKay said that when it came to staff, he wanted to bring a fresh approach to property management, including changing traditional job titles.
“What I’ve done is tweak the job titles a little bit, so rather than property managers, we call our guys client relations or property services.”
“I just think there was almost a weight to it (the property management title), so I wanted to break that.”
Additionally, McKay said that an advantage of ensuring he had the right people on his team was strong referral business through word of mouth or online reviews.
He said that because of the strength of the business’s referral base, he had become borderline obsessed with reviews and really pushed harder for clients to leave honest, genuine feedback.
McKay said that reviews were particularly important for investors when they are considering an agency, and that it was usually quite clear when reviews were genuine.
“Look at the number of and the consistency of the reviews, use that.”
“I think if they are genuine five-star reviews, people can work it out pretty quickly,” McKay concluded.
Listen to the whole episode here
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