Did You Know...Ancillary Services Management
Your Ancillary Experts
Did You Know…
Ensuring Maximum Return on Property Revenue
Did you know…one reason our Third Party management company clients use ASM is because a property management company’s responsibility is to maximize revenues for their clients’ properties. It is in the best interest of the asset to outsource this type of work to ensure maximum return.
Benefiting from Contract Expertise and Focus
Did you know…another reason our Third Party management company clients use ASM is because many property management companies are simply that, property managers, not contract managers.
While a property management company can certainly evaluate/negotiate contracts, it is not normally their area of expertise and focus.
Understanding What a Good Deal Looks Like
Did you know…ASM clients outsource contract negotiation and management of ancillary services because it has become increasingly more complicated over the years. The contracts and terms can be grueling to read thru unless you know what to look for. They need the expertise of having a firm that deals with the various providers and services and that understands what a good deal looks like.
Hiring an Expert with Leverage
Did you know…management agreements typically allow third party management companies to contract with vendors to provide services to the property. Property management companies have provider’s that pick up the trash, provider’s that handle serious plumbing repairs, providers that handle package management, providers that handle landscaping, etc.. Each of these vendors are experts in what they do. Our Clients look at the management of their ancillary services similar to these others. They hire a vendor (ASM) with the expertise, and leverage, to provide the best programs and income producing agreements possible.
Increasing the Likelihood of Improved Ancillary Income
Did you know…ASM has found that many management agreements do not consider collecting income other than normal collections for delinquency, misc. income such as application fees, late fees, pet fees, legal fees, and damages. To increase the likelihood of improved ancillary income, you need a firm that is focused solely on ancillary income. This has become a specialized segment of our industry and worthy of specialization.
Monitoring Your Agreements to Make Sure Opportunities Are Not Overlooked
Did you know…that just because an agreement is in place, there may be an opportunity to modify an agreement to bring on new service offerings and/or renegotiate early. It is critical to have someone constantly monitoring your agreements to make sure these opportunities are not overlooked.
Testing the Waters to Ensure You are Not Missing Out
Did you know…that even though you may have a great relationship with a provider, it is important to “test the waters” every so often as it becomes easy for both sides to get complacent, and you may be missing out on new services or better terms from your provider and/or from an alternative provider.
Having the Time and Energy to Properly Bid Out and Negotiate Ancillary Service Contracts
Did you know…that many Property Managers who oversee the operation and staff of one or more properties have so many other issues to deal with that they don’t have the time or energy to properly bid out and negotiate ancillary service contracts, thus leaving critical terms and conditions (and possibly revenue) on the table or locking a property into a bad contract, service, or service provider for an extended period of time.
Designating Someone to Manage and Negotiate All Similar Services
Did you know…that when multiple people within an organization negotiate agreements for a particular service or with the same service provider, you end up with a mish-mash of terms and conditions (some being worse than others) along with various revenue generation or savings programs. In addition, any buying power is being squandered. It is critical to designate someone to manage and negotiate all similar services to ensure you are taking advantage of any buying power as well as aligning contract terms and conditions across your portfolio.
Getting a Handle on Your Amenity and Ancillary Service Agreements
Did you know…that not getting a handle on your amenity and ancillary service agreements can lead to employee and resident dissatisfaction, which, in turn can lead to a spiral of:
- Higher resident and staff turn-over
- Potentially lower rents
- Higher resident and staff recruitment and retention cost
- Potentially lower qualified resident and less engaged staff
- Smaller budgets
- Repeat 1-5 above
Reducing the Time and Effort on Agreements and Maximizing Revenue
Did you know…the process of locating an opportunity, creating an RFP, analyzing the proposals, doing your due diligence, and negotiating the language of an agreement can take up to a year with some services/service providers. If you have someone working on one of these agreements who juggle other more critical aspects of their job, you can easily triple the time frame to get an executed agreement. Or you can settle for an agreement that will be missing critical terms and conditions and most likely leaving revenue on the table or locking a property into a bad contract, service or service provider for an extended period of time.
Avoiding Corporate Brain Drain
Did you know…the average staff turnover in our industry is 33% (found in this article from propmodo.com, 2/6/21, The Multifamily Industry has a Talent Problem, Tech can Help). Each time an employee leaves your company, the vendor relationship they built, along with the knowledge they had regarding particular agreements, leaves with them (“Corporate Brain Drain”).. This loss can affect services and revenue because you then need to take the time to get existing and new employees up to speed. If another agreement is signed with another provider during this time, it may lead to legal issues because no one knew an agreement was already in place.