Going into offices and discussing ways you can encourage the team to get on board with the rent roll growth plan is a part of my business that I really enjoy. These visits allow me to speak with the different departments and get their feedback on how things are run.
Recently, a comment was made to me describing property management departments as “the new black”. If this is the case, then why are sales businesses still recognised as the alpha into which all marketing funds are poured?
Writing about this subject isn’t easy for me; however, I feel it is a very important one which requires proper education. I still have principals of PM departments telling me that if they are paying someone to do a job they should just do it. The idea of an incentive is not even open for discussion.
If you want to manage or hire a top-performing BDM in our industry – you must ensure the package is driven for high sales performance.
If you put the BDM on a high retainer this will reduce the performance, as they will be satisfied with the income and just sign up whatever comes in through office marketing and the sales department.
Most BDMs I work with are expected to do the following and work under similar packages.
- They sign from five to eight managements before making any commission on properties signed and leased.
- They are paid a quarter of the let fee for the first five, half the let fee for the first 10, three-quarters of the let fee for the first 15 and a full let fee for 20-plus properties that are signed and leased in the same month.
- They are paid double the incentive for self-generated leads vs office-generated leads.
- They are on commission-only and paid a percentage of the first year’s income.
- They are in a partnership with the business owner and paid a percentage of the profits each quarter.
No matter which direction you decide to go in with incentives for your BDM, it is recommended you ensure they are held accountable for where they are spending time and what they are most focused on.
If a BDM is sitting on a comfortable wage, it is easy for them to get distracted as there is nothing to drive them to achieve set rent roll growth targets.
Out of all the positions in the property management business, the BDM is the one I have found to be the most thought-out and managed the least effectively. It may sound simple, but if your BDM is only signing up what the office generates and just covering the base wage, are they really a true BDM? I realise that I’m coming across very forward, but the misconceptions surrounding how powerful a true BDM can be for your business really bother me.
If you have a BDM on the right package from the beginning, with a detailed job description and KPIs they must report back with each week, you will know in the first one to three months if they are going to be suited to the role and uphold the business growth vision. During this time they may be signing massive numbers, but they should also be showing strong pipeline growth and a list of referral partner contacts.
Once you have the right BDM, it is time to grow your dream team; one that has the same vision as the principal and BDM. Anyone in the team can contribute to the growth path! The most successful property management businesses are rewarded as a team and celebrate every 100 properties in net growth.
As you continue to grow your property management business, these are the types of roles you can have as you pave your journey to 500, 1,000 or even 1,500 managements.
PROPERTY MANAGEMENT DEPARTMENT STRUCTURE
(this is a guide only)
BUSINESS DEVELOPMENT MANAGER
- Builds relationships and manages CRM
- Attends networking events
- Secures new business
- Follows-up prospects
- Prepares listing paperwork
- Handles self-promotion and social media
- Works in with sales team
- Manages and updates new listings
- Manages the department
- Manages systems and procedures
- Leads team meetings
- Organises staff training
- Handles and manages complaints
- KPI management
- Steps in when staff are on leave
- Enters rental payments
- Daily reconciliation & banking
- Monitors dishonoured cheques
- Payment of creditors
- Bond disbursements
- Mid and End of Month
- End of Financial Year
CLIENT RELATIONSHIP MANAGER/LEAD GENERATOR