Welcome to the Property Management Mastermind Show with your host, Brad Larsen. Today, Brad's guests, Todd Ortscheid and Scott Brady discuss going big or staying small, the merits of both, debating an article Scott wrote that with bullet points from Todd to flush out some key issues.
Todd shares his arguments for staying in the 200 - 500 door range with your property management company, whereas Scott believes that you need to go big and have multiple revenue streams. Scott says that if you take the DNA of a small company and overlap it into a larger company, it's a winning combination.
They both agree that you should know your why, why you want to stay small, or why you want to grow, know your purpose, and have a vision. Scott says that if you have a larger company, you have higher revenue, and it's easier to get a buyer. Todd disagrees and shares that a small company with a strong gross revenue is sometimes more desirable when selling.
Todd speaks about how automation and outsourcing are the ways to stay lean and mean and run a profitable company. Scott says that if you have a target client, compelling pricing, a great brand, and great customer service, you can grow your company and stay profitable.
There is nothing bad about making money just to be making money, and Scott believes you should monetize everyone you meet. The purpose of profitability is to provide a great service, and Todd has a fee program Brad recommends. There are two sides to each coin, but basically, if you know what you want and know how to get there, it doesn't matter your management company's size. You can make it profitable.
In this episode:
[01:40] Welcome to the show!
[02:36] Todd shares a little about himself.
[02:53] Scott introduces himself and what he does.
[03:48] Todd discusses his argument points for staying in the 200 - 500 doors range.
[04:23] Scott defines his argument points for going bigger for multiple income streams.
[05:34] Brad shares his insights into this debate from where his business stands.
[06:28] Scott believes you should take a small company's DNA and overlap that into a larger company.
[08:06] Todd says you need to know why you are doing what you are doing, find your purpose.
[10:33] Scott agrees with Todd that you have to know your why, but he disagrees that the number of doors you manage is about ego.
[12:05] Scott believes that people look at your gross revenue when you sell your business, so bigger companies have bigger revenues.
[14:17] Todd talks about the exit strategy idea, and he doesn't believe that you have to be bigger to have a strong gross revenue.
[17:27] Todd shares his techniques for staying lean and becoming profitable.
[18:28] Todd believes that automation and outsourcing are the keys to running a highly profitable company.
[20:56] Scott discusses staff and how owners get attached to their property managers, so if you are growing, you have a better chance of keeping your staff.
[23:16] Brad shares that he is always thinking of the how.
[24:26] Scott talks about having a target client, compelling pricing, a great brand, and great customer service, which is how he believes he is growing.
[27:41] Todd discusses how to get lean and mean and get your business to where you really want it.
[28:57] Start by mapping out your processes and procedures so you can get your VA's doing your work and automate.
[30:31] Scott talks about monetizing everyone he meets, not just the owners.
[32:40] Todd says there is nothing bad about making money just to be making money.
[33:15] The purpose of profitability is to provide a great service.
[35:25] Todd has a fee program that Brad recommends you look at.
[36:05] Brad speaks about PMMCON in May 2021.
[37:24] Todd discusses capital allocation and defines how to do it.
[39:58] The average profitability of a property management company is 6%.
[41:19] Scott shares his insight into allocating capital; he says his best investment is his company.
[43:56] What percentage of property management companies live month to month?
[47:25] Thank you for being on the show!
Links and Resources:
(619) 988-6708 (Allison DiSarro from Seacoast Commerce Bank)