I love the Olympics and in the true spirit of competition let’s talk about the Vacation Rental Industry. As the Vacation Rental Industry grows so does the competition. From the Vacation Rental (VR) Company perspective the competition is fierce. There is competition to attract new and returning guests, competition to attract the best properties and home owners, competition to attract and keep great employees, competition against hotels, competition against marketing channels (VRBO, Airbnb, etc.…).
With all of this competition most VR companies have had to adapt and as a result have seen their commissions getting squeezed resulting in a shrinking bottom line. It is because of this that VR companies need to be extra vigilant in every aspect of their business. Taking ownership and responsibility of how and where you are spending will help in becoming a more profitable business:
- The main use of your company’s money is for: 1. Getting More Customers. Cutting Costs. If your money is not going to one of those two things you probably are not spending wisely.
- Cutting costs in a business is important, but in order to do that knowing where you are spending your money is the first step.
- Having good book keeping and meeting regularly with your accountant or CPA is key. Having regular meetings with your CPA can be a revelation as to where you are spending unnecessarily.
- Be sure to think and rethink each purchase and employee hiring.
- Don’t combine personal spending with business. This in the long run hurts the value of the business.
- Make sure you have identified your core most important/vital employees. For other non-vital areas of your business maybe consider temp agencies or outsourcing certain jobs or tasks.
- Be sure to constantly evaluate systems and staff. Look for wasted time, money and resources. Do not get complacent and always ask why.
- You can save on your spend by looking on Craigslist or second hand stores for office equipment (copiers/printers) or furniture.
- Make sure that all employees are diligent about keeping track of their spend and receipts.
- Do as I do and as I say. The company leader/owner should set the example for the rest of the staff and team. Little things count such as turning off lights, haggling with vendors, and how staff are treated.
- When it is possible do the work yourself. Some ideas could be: Cleaning of the office, small repairs, and creating and printing office forms and templates yourself.
- Get to know and partner with non-competing local businesses to buy supplies in bulk or swap services if possible.
- Keep track of petty cash - It may not seem like a lot, but it can add up over time.
- Cut down on waste. If you still print…print on both sides, reuse shipping and office materials, and don’t recycle that scrap paper right away use blank side for note taking.
Remember your company’s money is your responsibility. Knowing how and where you spend is critical to being a profitable business. As the Vacation Rental Industry keeps maturing the competition is only going to become more intense. Be sure to control what you can, and controlling how and where your money goes may be the number one area to winning the competition.