Starting Over - Part 1
If you were going to start your business today, what would you do differently from the way you currently operate?
Let me get you started.
I'm working with a customer in the hospitality business. It's not a hotel; rather it's a business that manages privately owned properties and rents them on behalf of the owners. Guests book the properties - some are houses, some condos - pay the rental fee, check in and check out. The owners receive a percentage (usually 55%) of the revenue; my customer retains the balance.
Virtually all of the property management firms in the area operate the same way. During the high season, they offer Saturday-to-Saturday stays. Guests check-out by 11a on Saturday; new guests check-in after 4p on Saturday. In the other seasons, they rent the properties whenever they can, some for short term stays, others for longer terms (preferably for months).
You make your money - whether you're the owner or the property management company - in the high season. You hold on and make whatever you can the rest of the year.
That's the way it works now. The competition works against you in several ways:
- Everyone is fighting to manage more properties. The more inventory you have, the more renters you can serve, and, thus, the more income you can generate.
- Everyone is fighting for quality cleaning crews...one day - for five hours - per week. The entire geographic area is turning over its inventory between 11a and 4p on Saturday.
- The key to your business is repeats - from one year to the next - but everyone is also trying to attract new renters to fill up the excess and cover for attrition.
In a nutshell that's how it's working.
If you were buying into the market, or if you were starting-up a new business, how would you look at the paradigm, how would you approach your offering, how would you establish your distinctiveness, build your brand?
Let me get you started.
I'm working with a customer in the hospitality business. It's not a hotel; rather it's a business that manages privately owned properties and rents them on behalf of the owners. Guests book the properties - some are houses, some condos - pay the rental fee, check in and check out. The owners receive a percentage (usually 55%) of the revenue; my customer retains the balance.
Virtually all of the property management firms in the area operate the same way. During the high season, they offer Saturday-to-Saturday stays. Guests check-out by 11a on Saturday; new guests check-in after 4p on Saturday. In the other seasons, they rent the properties whenever they can, some for short term stays, others for longer terms (preferably for months).
You make your money - whether you're the owner or the property management company - in the high season. You hold on and make whatever you can the rest of the year.
That's the way it works now. The competition works against you in several ways:
- Everyone is fighting to manage more properties. The more inventory you have, the more renters you can serve, and, thus, the more income you can generate.
- Everyone is fighting for quality cleaning crews...one day - for five hours - per week. The entire geographic area is turning over its inventory between 11a and 4p on Saturday.
- The key to your business is repeats - from one year to the next - but everyone is also trying to attract new renters to fill up the excess and cover for attrition.
In a nutshell that's how it's working.
If you were buying into the market, or if you were starting-up a new business, how would you look at the paradigm, how would you approach your offering, how would you establish your distinctiveness, build your brand?
posted by Mark Burris - BURRIS at 9/22/2005 08:28:00 AM
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