The association management industry if fraught with competition, and because of the healthy growth of homeowners and condominium associations, opportunity is seemingly endless. That’s why so many budding entrepreneurs enter the market every year. At CINC Systems, we’ve helped many businesses grow from one-association startups to multi-association empires. We’ve also helped tried and true brands continue to build revenue as a result of their software investment. We’ve seen a lot of strategies that have catapulted growth, and we’ve seen a few reasons why growth may be stunted. As you’re evaluating the ways in which you plan to build your business for 2022 and beyond, consider these common mistakes that business owners make:
1. Not knowing your audience
Jason Delgado of Rise Association Management says it best: you should know who your ideal customer is, and who your ideal customer isn’t. Oftentimes when one is breaking into the association management industry, they will want to be something for everyone, and will be willing to take on any client that comes their way. While building a healthy portfolio is certainly important, what’s more important is the service you provide after the sale. After all, churn is a huge concern in the industry.
So, who can you service best? Perhaps it’s luxury condominiums in urban areas, or starter homes in single family neighborhoods. By understanding who your brand represents and your dream client, you’ll be able to hone in on messaging that captivates your dream client and builds your portfolio with quality associations that you know you can service to your best potential.
If you’re not sure how to define your dream client, take a look into our Brand Affinity E-book from our Ultimate Guide to Marketing Your Management Company. You’ll build out your company’s mission and vision, your WHY statement, and your ideal customer profile.
For a free consultation, call 855.943.8246
2. Not focusing on the homeowner
At the end of the day, what are we here to do? It’s not to send off violation letters or dictate the color paint one can use on their homes. We’re here to build community and make living in an HOA a great experience. That means that the homeowner is at the center of our universe and everything we do.
This can be challenging to remember, of course. From managing month-end financials to keeping employees motivated during difficult client conversations, it’s easy to take focus off the homeowner and onto other tasks. But when management companies focus on providing services and tools that take the burden off of the homeowner, business prospers. This includes mass communication tools that give homeowners quick access to the answers they need, and self-service tools that makes HOA living seamless. When homeowners are satisfied with your services, they’ll be sure that the board members know, and those board members will gladly inform other prospective clients of everything you have to offer.
3. Keeping a budget for everything but your own business
Management companies certainly have budgets for each of their associations. But what about the actual community association management company? Oftentimes owners become so engulfed with the budgets of their clients, they forget to create a budget for themselves. Without a proper budget in place, profit may not grow even if revenue does. And if you’re at all concerned about rising inflation rates, you definitely need to keep track of your spending.
Luckily, managing the budget of an association management company is a bit simpler than HOAs and COAs, as the plan is similar to other small businesses. In addition to keeping control of everyday expenses, you should also consider where you can afford to grow, where you should be cutting back, software upgrades you’ll need to drive efficiency and service, and if your prices fall in line with rising expenses.
If you did not plan out your budget for the upcoming year yet, all is not lost. Go ahead and start planning with the basics so you are at least keeping track of spend. Then, begin to evaluate where your spend may be hindering your growth and where you may be investing too little.
4. Not using your software to your advantage
Of course we can’t not mention the importance of a software solution to growth in association management! Anyone running a business with plans to grow needs a scalable software solution that improves employee workload, provides self-service tools to board members and homeowners, and empowers management companies to market their business professionally. Consider, for instance, the top three core needs in software:
- Automation: Replacing time-consuming manual tasks with sophisticated software increases the speed and accuracy of your team.
- Centralization: An all-in-one solution that addresses both the financial and property-related responsibilities of your management company saves time and money by eliminating the need to log-in to multiple platforms a day, manually move data from one place to another, and manage multiple vendors.
- Integration: Software that seamlessly integrates with your bank (as well as other strategic partners) closes the gap between finance and accounting, enabling daily reconciliation, faster payments, and a more streamlined month end process.
By using software designed for scalability, your existing team will have the bandwidth able to take on more. In fact, some teams are actually able to manage double the associations with the power of an industry-leading solution.
By knowing some of the common pitfalls that can stunt growth in community association management, you’ll be able to avoid behaviors that lead to these mistakes. And if you’re looking to see how software can take your growth plans to the next level, read up on our Ultimate Buyer’s Guide to association management software.