Community Association Management companies (Condos, Townhomes, and HOAs) often struggle to increase profitability. This slide deck explains how management of your client portfolio can help increase profits.
This presentation is an excerpt of the CAM Profitability Conference, an educational half-day traveling seminar, and was originally presented in 2014 at the CAMfire Conference in Las Vegas, NV. The presenters were Jeff Hardy, Founder and Chairman of TOPS Software, and Craig Huntington, President of Alliance Association Bank, both of whom are founding members of the CAM Profitability Conference.
3. What are your
reasons and goals
for being in the
community
management
business?
4. “
Provide a valuable service to the community
Offer a desirable workplace for employees
”
Your company goals should include:
Operate a healthy and profitable business
Defining Your Management Company
Set Your Goals
5. Self Analyze & Contrast with your Goals
• Compare and contrast your goals and priorities with the
present state of your organization
• Write it down
• Remember business plans are fluid
• Constantly review and revise
Defining Your Management Company
6. Create a Self Analysis using the SWOT model
• Strengths and weaknesses are
internal factors – completely
in your control
• Opportunities and threats are
external factors.
• Strengths and Opportunities
are helpful, and should be
nurtured.
• Weaknesses and threats are
harmful, and should be
eliminated
7. Self Analysis (Internal Factors)
• What do you really do?
• What need do you fulfill?
• How large is your market?
• What are your strengths? Weaknesses?
(Be honest!)
8. Self Analysis (External Factors)
• What distinguishes you from others?
• Who is your target client base?
• What are your revenue streams?
• What are your costs, margins & profits?
9. • You are a professional, ACT
LIKE ONE (and charge like one)!
• Get rid of the Voice of Treason.
• Decide want kind of company
you want to be.
• Evaluate constantly to see if
you are reaching your goals.
• Never be afraid to fire an
association.
• Don’t spend 80% of your time
on 20% of your clients.
11. Which of these Community Types Fits
Your Business Model?
Single Family HOA’s
Garden Style Condo
Mid-Rise/Hi-Rise Condo
Townhouse HOA’s
Defining Your Management Company
12. The Community Types In Your Portfolio
Affect Your Business
HOA’s
Single Family or Townhouse
communities are easiest to
manage since you’re only
responsible for common area.
Defining Your Management Company
Single Family HOA’s
Townhouse HOA’s
13. The Community Types In Your Portfolio
Affect Your Business
Garden Condos
Garden Condos involve more
maintenance and require 24 hour
on-call staff.
Defining Your Management Company
Garden Style Condo
14. The Community Types In Your Portfolio
Affect Your Business
Mid-Rise & Hi-Rise Condos
Mid/High Rise Condos are the most
difficult to manage. The higher the
units are stacked, the more
problems you may expect. Elevators
and garbage chutes are constant
problems. Must have adequate and
well-trained staff to handle these
properties. May require on-site
staff.
Defining Your Management Company
Mid-Rise/Hi-Rise Condo
16. What is Portfolio Management?
It means developing “Smart
Growth” practices to grow your
management company.
It means taking on new customers
that fit a pre-determined target
business strategy so you not only
cover your costs, but make a
profit.
Defining Your Management Company
17. Who Needs Portfolio Management
• Established management companies
• Start-ups must take any community they can get!
(Only established companies with good reputations can
afford to be picky)
• It takes time to transition your portfolio to “Smart Growth”
• Consider proposing
“Financial Only” management
to smaller communities
Defining Your Management Company
18. Smart Growth Strategies
• Elements of “Smart Growth”:
• Know your fixed costs for each community you manage
• Time Studies
• Estimate Time Spent
• Set a monthly minimum management fee that covers your
fixed costs
• Determine the minimum
community size that meets
your criteria
Defining Your Management Company
20. •You cannot afford
to manage small
or “loss leader”
communities
• Small communities
take as much staff time
as larger communities
• They use up limited
resources that are best
applied to higher
paying communities
Defining Your Management Company
21. Troubled
Communities
take too much
staff time.
Distance can
be costly.
Troubled or Distant Communities
• Troubled communities take too much
staff time
• High risk of losing the contract
• Bad attitudes of officers and
residents
• Distance from your office can be a costly
barrier
Defining Your Management Company
23. “
Portfolio Management is one of the essential
building blocks of a profitable management
company. If you follow "smart growth"
principles, it will bring positive results and
increase your profitability.
”
24. “
For more information on increasing the
profitability of your Condo/HOA management
company, we recommend the CAM Profitability
Conference, a series of half-day seminars, coming
in 2015 to a city near you! Look for the schedule
and register at http://camprofitconference.com
”
Defining Your Management Company
Craig
Huntington
Jeff
Hardy
25. This presentation was given at the 2014
TOPS CAMfire Conference. Learn more about
CAMfire at www.camfireconference.com
For more helpful articles for community association
management professionals, visit the TOPS CAM Blog at:
http://camblog.topssoft.com
Images used were in under the creative commons license, as found on flickr.