52 Week Video Series – Week 5 – The Four Ps!

Do you REALLY know how to make customers return to you time and again? What are the four Ps that make them use YOUR services/ and business more than anyone else’s?

 

 

 

I look forward to hearing how you get on increasing your business by using these four Ps!

Too busy to systemise your business? Or maybe you are scared of the cost of it?

Busy deskIt was a cold, rainy day – the kind of rain that drips over your nose and down your clothes and makes you sopping wet even before you’ve stepped outside. You know the kind I mean. A fairly typical summer’s day in England!

I was sitting in our home office, when Andy walked in, cup of coffee in hand. As he sat down, I glanced across at his desk. The contrast between his desk and mine was stark. Mine – covered in all sorts of paper documents – bills, mortgage statements, letters, post-it notes of to-dos that hadn’t been done and should have been done last Friday. His – a monitor, wireless keyboard, mouse and speakers. No paper, no mess, no distraction.

He sat down and put his wireless headphones on, and I started to hear the muted ‘thud, thud’ of The Gorillaz latest album. I muttered under my breath ‘GEEK’ .. and proceeded to wade through the paper on my desk, deciding the quickest way to deal with the pile was to push it all onto the floor and use it as a new form of carpet tiles. At least that way I didn’t have to look at it. And my desk was then as clear as my darling nerdy husband’s.

‘Do you have the mortgage offer for Gainsborough Road somewhere?’’ Andy asked as he moved one earpiece to hear my response.

‘Um, yes, er, definitely, I saw it this morning’ I said, knowing that it was definitely here, somewhere. The only thing was which foot was it under?

After a search of about 10 minutes I enthusiastically pulled it out from underneath the pile and placed it ceremonially on top of his keyboard.

‘Wendy we need to talk’, Andy turned to me with a serious look on his face.

‘Oh, is the offer not what you hoped for?’ I replied.

‘No, it’s not that’ he said.

‘Ah so is it that we need to buy more coffee when we’re out?’

‘No, we’re fine for coffee.’

‘So what’s bothering you babe?’ I prodded.

‘Well, you know I love you very much Wendy, but there is one thing that is starting to drive me crazy’ he said.

‘Well I know I have that effect on a lot of people’ I said, with a cheeky grin. ‘What’s the matter babe?’’

He took a deep breath, and looked me straight in the eyes, ‘the truth is, unless we sort out our systems, this office and all this paper we simply will not be able to scale up. Your desk is a tip, you can never find where anything is and you are wasting not only your own time but mine too’.

I sat in my chair, feeling totally deflated. I had worked so hard to create a portfolio of HMOs that had given us financial freedom. We now had a regular passive income of £6k per month. The last three years had been nothing but hard work and I had the evidence to show that taking massive action, managing risks that many other people wouldn’t have the courage to do, and using other people’s money could create financial freedom. I had left my job and wound down my other business to focus on this one. Andy had also been able to leave his well-paid role as a contractor.

We were supposed to be happy.

But right now, at this point in time, the last thing I was was happy. I felt annoyed at myself, annoyed at him, and annoyed with the business.

The thing is I realised that Andy was right. Deep down, I absolutely KNEW that my entrepreneurial skills were great when it came to new ideas, growth, and creating income. But on the other hand, creating a system that someone else could pick up and use and freeing up my side of the office from all that paper that I had grown to know and love – well that was NOT within my gift.

I knew I had to change, I knew the business had to change and I knew that the only answer was to systemise.

So over the next 12 weeks, Andy and I set about looking at ways that we could create a leaner, more automated, systematic and ultimately leveraged business. We wanted to employ staff, or outsource the things we didn’t like doing. But to do this we had to start moving our erratic business practices onto a much better platform.

RESULTS

Immediately we began to notice a difference. First in the time we had. We had much more of it! The little jobs, the things that I would have had to write on a post-it note and stick on the edge of my monitor just to remember them, were gone. They were contained within a system. As long as I remembered to go to the appropriate tool, I could find exactly what I wanted when I wanted it.

Soon, this impacted our profits. We had more time so we had more time to do better deals, and more deals, and find more investment. In fact in that year alone we raised over £500,000 for further HMO projects. We bought another 9 properties, and added another £3,700 to our monthly income. There was no way we could have done that if we had been stuck behind our screens or on our phones managing refurbs, tenants or payments.

Our quality of life started to improve as we had more time to exercise, to do more with our family and to R-E-L-A-X.

This was all because we had systems.

Then the best part began as we realised that with the systems we had implemented, we could create a team to manage our properties, with marginal involvement from us. So we began to recruit – first a Lettings Manager who would run the lettings side of the business, then an Operations Manager who would run the day to day aspects of the business. This then, in turn, freed up mine and Andy’s time to do other deals and to speak with investors and to pursue some of our other passions.

So HOW EXACTLY did we do this?

In systemising our business, we both agreed that the key principles we needed in a system were that it had to be

  • Simple
  • Scalable
  • Shareable
  • Suitable
  • Secure

What were the tools that we needed and how would we decide?

We realised that the process would be a three-step process. First we had to SCOPE the business and decide how to breakdown each area, then we had to SPECIFY what our business did in each of these areas, then we had to SYSTEMISE. Most of all it had to be LOW-COST or NO-COST so that we could free up our time without taking up all of our profits.

Although I can happily use a computer and mobile phone, I am not the most technical person in the world so our system had to be easy to learn and implement. The last thing I wanted was anything that needed multiple log-ins or a computer science degree to operate.

After a few weeks of searching and analysis, Andy suddenly rose up one day from his computer chair and shouted ‘Eureka’! I’ve found the exact tool that will work to help us

  • Find properties
  • Fund projects
  • Finish refurbs
  • Find Tenants
  • Future-Proof our portfolio

And that tool is…. ? If you’d like to know EXACTLY what that tool was and HOW we used it to run and grow our business (and still do to this day) and how YOU can too ….
Click here to find out more

To your success!

Wendy

My Top 5 Success Tips For The HMO Property Investor

7 Bed HMO in Stoke on TrentIf you have just started in HMOs you need to get off on the right footing! Here are some key tips on making you HMO work for you:

 

  1. Make sure you know the complete cost of the project before you begin. Always add in a contingency figure (5% on anything over 120k).
  2. Calculate the predicted ROI (Return on Investment) and if it’s likely to be less than 15% DON’T DO IT. You can get faster, cheaper returns by investing in other assets.
  3. Do the Spareroom numbers: if there are any more than 3:1 rooms available to tenants looking, NOW is NOT the time to buy in that area. Too much supply.
  4. Create your Key Performance Indicators (KPIs) at the start, middle and end of the project. You will invariably change what you want to measure but your KPIs will probably include: monthly rental (predicted); monthly rental (actual); occupancy, advertising costs; length of voids; maintenance spend; time spent on business.
  5. Ensure you  (or your accountant) create a Profit and Loss statement that you analyse monthly.  Even if you just have one HMO this will keep you on track and get you to drill down into minimising costs and maximising income.

 

If you implement these first five steps in your first project you’ll start off brilliantly well! You now have the foundation to scale and grow.

To your success!

 

To take your knowledge to the next level, join my new 1-day Fast Track Course on the 14th October! Learn more.

The Insider Guide to Using Spareroom

*This article first appeared in HMO Magazine - The Go-To Magazine for HMO Landlords,
 Investors and Developers

Knowing how to get your goods to market is vital if your business is going to succeed, and this is no exception when it comes to renting rooms. When Spareroom (the UK’s largest flat-sharing website) was launched, it changed the landscape for HMO property investors overnight. There is an argument that it enabled the sector (particularly professional HMOs) to grow exponentially as it allowed landlords and investors to have an immediate and interactive presence on the internet. Even if they had no website, marketing strategy or smartphone, the power of Spareroom was that it removed the pain of advertising for landlords, placing any room directly in front of a willing and ready buying audience.

Spareroom website screenshot.
https://www.spareroom.co.uk/

Since its inception in 2004 Spareroom has continued to be top of the room-renting listings portals and has developed additional features and benefits for both tenants and landlords. There are a number of aspects of which you may not be aware, and in this post, I want to share some of those functions which may help you reduce room voids and increase your profits – particularly if you are not familiar with some of the newer and more dynamic features of the site.

Reduce room voids and increase your profits

Spareroom is an online environment which changes daily. It is a site where prospective tenants and aspiring landlords create profiles and upload photos and videos with ease.  They get over 2 million visitors every month – that’s 11 times the circulation of the Guardian. Much like online dating, there are constant matches, suggestions and recommendations being made to tenants and landlords. Unless you are aware of the speed at which the site can change, you will probably miss out on potential tenants who could be ideally suited to your property.

Be active not passive

Unlike many marketplaces where you cannot see your customer, Spareroom helps connect you directly to people who may be interested in renting a room. In a busy marketplace where choice abounds and there are a number of good looking rooms to choose from, what sets you apart from the rest? Research tells us that tenants prefer to rent from private landlords or people that they feel they can connect with, and who they feel care about them. They don’t like to be treated just like a number (well who does)? They also stay longer in properties where the landlord takes maintenance, customer care and service seriously and puts tenants’ needs first. So rather than waiting for prospective tenants to contact you, you can carry out a search for your ideal tenants on ‘Rooms wanted’ by typing in your chosen location (i.e. the location of your HMO). This will bring up a list of people who are looking to rent in your area, along with their budget. Send them a friendly message, inviting them to arrange a viewing of your property (along with a link to the advert). This also allows you to decide on people who look like a good fit with your property and ensure they meet your requirements. The personal invitation to view is a great way to demonstrate your proactivity. Make sure you read their preferences first though otherwise it won’t look as if you really care if they’ve stated they want a large double ensuite room and all you have to offer is a single with a shared bathroom!

 

Statistics and measurement

One of my maxims in life is ‘Treasure what you measure and measure what you treasure’! If renting your rooms is valuable to you then it’s crucial to know how that well-crafted and beautifully photographed advert is performing (and if it’s neither of these please see below for further help and advice)! When you log into your account go to your advert management page (where all your ads are listed  – called ‘My Placed Ads’). Halfway down you will see a small box named ‘Featured Ads’ and there is a clickable link- ‘Settings and statistics’ which shows the number of times your advert has been seen and clicked on in the previous week (or chosen period of time). One of the key components in keeping your advert at the top of the listings is how often you edit it, and how many click throughs you receive. Keep your advert fresh by occasional edits, changes and re-wordings. Ensure the photos show your rooms off to the best possible standards and please, please, please dress for success! Above all, don’t let your advert languish. Otherwise your clickthrough rate will rapidly diminish and you’ll end up on page 9. Where no-one goes …

If you are still struggling to get enough views of your advert, here is a brief explanation of the ways to upgrade and boost your chances even more:

 

Advertising Upgrades

Three additional services that you can upgrade to are:

  • Early Bird
  • Bold Advertising
  • Featured Advertising

 

Early Bird status allows all new prospective tenants to see your advert as soon as they log in or create their profile. [Named Early Birds by dint of paying extra to see new adverts first. It doesn’t mean they are early risers – please don’t confuse the two]. If you have not paid for Early Bird status it will be a few days before your advert is placed before new tenants, losing you time and valuable viewing opportunities.

Bold Advertising enables your ad to be displayed with a lovely blue border around it this differentiating it from the standard grey border, and enhancing the placement of the listing.

For these services you can pay for a monthly, 3-monthly, or annual fee for a defined number of property adverts. If you wish to add further properties to the Bold Advertising pass this is possible too. Usually, Early Bird and Bold Advertising are purchased together.

Featured Ad status is a pay-per-click service. This works on the basis of a bid price which is calculated by Spareroom’s internal algorithm. It takes into account the number of rooms available in your locality, the level of competition for top advertising space, and the number of potential matches for your advert. As I mentioned earlier, Spareroom is a dynamic advertising environment which means that there can be rapid transactions taking place simultaneously. You can find that one day the cost to place your room advert at number one position is 80p and then a week later, £1.20. To understand the way Featured Ad status works and how to get to number one position, you need to go to ‘My Featured Ad’ page (which you get to by clicking on ‘Settings and stats’)  accounts management page and click the tab named ‘Rankings’. Here you will be able to assess the current ranked status of your advert and decide how much you are willing to pay to be at number one in the rankings.  You can then decide how much to pay for the privilege of number one position by going to ‘Individual Ad Bids’ (on the same page).

 

It is worth considering Featured Ad status if you have one particular room that you’re finding hard to shift. Avoid having a number of adverts all featured at once, or you’ll find you are bidding against yourself and then having the difficult choice of which one to prioritise.

Otherwise, remember the tips above to keep your advert fresh and current to raise enough interest to rent your room.

 

Information and advice

Spare room recognises that the site has many facets and if you are new to online advertising you may need some additional advice and help. If you click on the ‘Info and advice’ tab in the top right-hand corner of the site you can gain further access to useful information and examples about how to improve your advert, how to create a video, how to describe your room, how to market your property effectively, and much more.

 

Spareroom is a marvellous resource if you know how to use it. But it can be overwhelming and confusing too! For a free webinar with further information about ‘How to Harness the Power of Spareroom’ please visit my website www.hmosuccess.co.uk and register with your name and email address.

Free webinar insider guide to Spareroom
Free webinar insider guide to Spareroom, register now!

 

 

 

Is a ‘paper-free’ office really possible?

Paper free office Creating a clutter-free and paper-free environment will massively help your productivity and efficiency.

When you run a business, however much you rely on technology to reduce your use of paper you’ll still find that there are office-dinosaurs out there who just LOVE to write things by hand, or type letters, or send paper bills in the post. It seems that you just cannot get away from using paper!

There are so many reasons why using paper wastes space, burns time and uses up valuable resources. Getting rid of it from your office will allow you to do so much more with the space you save and also give you a much faster working environment. So how do you reduce the overload, streamline your work area, and get rid of all unnecessary paper?

When we committed to running a ‘paper-free office’ in 2015 we had to invest in two key pieces of kit to help us do this quickly and well. I suggest you do the same – the first is a FAST double-sided scanner that saves copies to pdf.

  1. A ScanSnap S1500 scanner by Fujitsu ( discontinued now but the replacement is the Fujitsu ScanSnap iX500). It isn’t cheap at £350. Worth every penny though, as it scans super-fast and then saves each document into your chosen folder on your drive. We use Google drive as it is so fast and searchable which means you never lose a document.
  2.  An efficient shredder, and a young shredding assistant to do the work! The former you can buy from Amazon – our latest one is the AmazonBasics 5-6 Sheet Cross Cut Shredder which is just £30.99 from Amazon. It is fast, takes up to 8 sheets of A4 at a go and also shreds credit cards. The shredding assistant is harder to come by unless you have a ready supply of children impatiently wanting to earn some extra pocket-money. A neighbour’s child will do if you can’t supply your own. A half hour of shredding for £3.50 in return works wonders!

Our maxim is scan-save-shred. We apply this to almost every little teency bit of paper we get in the house: receipts, useful articles from magazines, letters, bills – you name it. We pile ‘em up, scan them in, save them in an online folder and shred ‘em.

It has created cubic megameters in our home office. We no longer have paper clogging up our in-trays, or shelves full of magazine files, or filing cabinets bulging to the brink with documents. De-cluttering your office of paper will bring you mental as well as physical space. But you need to regularly attend to it or the overload happens incrementally!

If you want to know more about how to streamline and systemise your processes, we are running a Property Power Systems Workshop on 2nd Sep about how to use Google to build your business. There will be LOADS of useful ways you can save money, create time, and freedom by using low-cost and no-cost solutions just like this so you can reduce your overload and create true freedom.

 

For only £99 reserve your place on the morning workshop here: https://goo.gl/JkDzWk

Or the afternoon one here: https://goo.gl/rcSQfz

 

Nike, Adidas or Puma -does your brand really matter when it comes to HMO rooms?

footwearBelieve it or not, what you do, how you do it, what you say and how you say it says a LOT about YOU. And that applies to properties and HMOs too. If you’re not convinced, let me share how your BRAND speaks volumes to your customer.

Let’s say you are a prospective tenant called Paul, a working young professional, perhaps starting a new graduate trainee scheme in a new area. You don’t want to rent a flat with all the encumbrances of bills and direct debits. You just want to pay one price for fully-inclusive rent. Simples! The answer is of course to rent a room in an HMO – a shared property where you have a private bedroom and possibly ensuite, but shared kitchen and outside areas. You will have to take on some of the responsibilities of emptying bins, locking up and cleaning your own room, but if you haven’t mastered those things by the time you’re 21 what use is good parenting or a University education??

So, you are quite prepared to take the ups with the downs of communal living, and you start searching on Spare Room (self-proclaimed number one website for house shares in the UK). There are a number of vacancies in the area you’re searching and you’re pleased with the choice. As you start to examine the photos and the descriptions of the properties, you notice some stark differences between the adverts. Some have great photos of lovely rooms, presented well and with detailed descriptions of what’s in the all-inclusive price. Others look frankly neglected – a mattress with obvious stains and an unmade bed; mismatching furniture, and blurry photos taken on a dated phone camera after the cameraman had had one too many lunchtime pints at his local. You’re reaction is ‘Yuk, who would want to rent THAT room?’

Two very different offerings and two very different brands. Probably two very different landlords and two very different sets of tenants. Not necessarily two different sets of profit figures though, which might surprise you.  There is a market for both. At the lower end of the market there is a need, a great need, for cheap, simple and basic accommodation. True, the tenants you attract may also be described as such, but as long as they pay on time and look after the place, are you bothered?

On the other hand, you might want to corner the local market for more up-scale, trendy rooms which demand a higher price tag but can also demand a more discerning and, ahem, a more demanding clientele. In this case, Paul has a choice. He can choose to pay more for a more luxurious room, but in his mind he might also be wondering, ‘Will the landlord be a pain, checking up on me all the time? Will the other tenants be high maintenance and always complaining about stuff?’. Paul then wonders about the other room. It’s certainly cheaper and less salubrious, but it probably means he can get on with his life without any hassle. On the other hand, if there’s a leaking tap, how likely is it that this landlord will be bothered to fix it?

As Paul ponders these questions, I want to put some questions to you, dear HMO investor. You see, the way you or your agency interfaces with tenants also says a lot about your core values – are you traditional (old fashioned some might say) and do everything with paper (remember that stuff that comes from trees)? Are you highly geeky and use all the latest apps and online tools but find that an actual conversation with a person is quite stressful? Maybe you are the next and upcoming editor of HMO Vogue and know your pantone colours from your RAL codes (paint codes for the colour ignorant).  Your HMOs are beautiful inside and out, but you have to rent an additional warehouse for all the arty additions displayed in your photos and you are VERY protective of your designer wallpaper.

What about communication? How do tenants contact you? Will you accept a text at all hours of the day or night? Or is it by telephone only during office hours? When a tenant moves in, what kind of impression do you create? Do you carry out an induction, explaining how everything works and the ground rules, or are you more laid back, letting know that the key is under the doormat, please keep the fridge clean, and we’ll see you in 6 months?

Each aspect of your business builds your brand – so examine WHAT you do and HOW you do it. You are conveying a message with everything you do. In marketing, professionals use the three Ms – Media, Message and Mode – and these can be directly applied to property too.

What Media are you using to communicate with your customers what does this say about you? What is the Message you are trying to convey (a better question is what emotion are you trying to elicit so that the tenant will rent your room and stay) and what Mode of communication are you using – and which modes do your tenants prefer?

The three Ms can be applied to all aspects of your business, none more so than in your interactions with the outside world – your market. For them, like Paul, they are assessing those three Ms subconsciously to be convinced that you have exactly the right room in the right house, and that they will be the right tenant paying the right price.

 

Finding your Power Team

What is a Power Team? And do you really need one? You may have heard a lot of people speaking about their Power Team – and how valuable they are. If you are new to property, or going up a gear in your investing, you definitely need a team of people to support, advise and work with you. Known as a Power Team because they empower YOU to be better, they undertake specialist roles that you can’t do and they enable you to do stay focused on the BIG PICTURE.

So who are these people and who do YOU need?

Optimally you will have all of the below who you can call on when you need advice, guidance and support. Some of these people you will deal with very regularly and others only occasionally. Dependant on your strategy, some of these people will become more or less useful to you. For example, we specialise in HMOs but have an internal team who manages the rentals, so we need to know how to market and sell as much as how to source property. If you haven’t identified someone in each of these categories yet, make that your goal for 2017.

Internal Power Team *who work either exclusively for Best Nest or are contracted to work with us:

  • Operations Manager
  • Lettings Team
  • IT specialist
  • Property sourcer
  • Project Manager
  • Maintenance team

It may be that you want a more ‘hands-free’ business, in which case the above list may be irrelevant for you. We’ve found that the best way to manage HMOs is to keep them ‘close to your chest’ – in other words to handle the lettings personally and grow your business through further development of units of accommodation.

External Power Team

  • 2 mortgage advisors (IFAs)
  • A specialist property solicitor – who can not only undertake conveyancing but can also advise me on transactions and structures of deals
  • Accountant and bookkeeper (can be the same or can be different people)
  • Builder
  • Commercial and residential estate agent
  • Structural engineer
  • Surveyor
  • Tax advisor
  • My mentor

These core people have access to sensitive, personal information and help us with strategy, guidance and risk. So being able to trust them is critical and their reputation and continual commitment to high levels of service delivery is also crucial. Outside of this immediate External Power Team we have other contacts within our network who we know personally and who we can pick up the phone to if we need advice, help or suggestions.

  • A letting agent
  • Planning expert / advisor
  • Marketing expert
  • Furnishings experts and Interior Designer
  • Tradesmen – Gas Engineer, Plumber, Electrician, Joiner, Window and Door fitter, plasterer, tiler, bricklaye

If you network and also test these individuals for reliability, commitment, pricing and delivery, this will massively help you grow your income from property. Knowing all these people within our network enables us to find answers to questions,  brainstorm dilemmas, and find solutions. Unleash your power by finding the right team – ‘cos when you do that,  not only will you help them, you’ll hugely help yourself too. jobs-quote

 

How you make people feel really matters

“I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.”
― Maya Angelou

So how do you make people feel? In different transactions and relationships we probably want to make people feel a variety of emotions – desire, anticipation, regret, loyalty, empathy, fear, longing, even love. This is not manipulation, this is interaction – all humans have an amazing ability to create feelings in other people without even realising it.

How often on Facebook have you felt sad, envious, pitiful, happy, delighted or worried? Just by reading other people’s posts about their lives and seeing what they’re up to! As someone who generally likes to get along with others and have harmonious relationships, I have often struggled when I have created pain in others. Well you could say that the pain was already there and I brought it to the surface by something I said or did. I think many of us don’t want to cause pain in others so shy away from those interactions which bring it to the surface.

However, in becoming a speaker I have realised that bringing pain, fear, loss, regret, longing to the surface is my job. It enables people to look at their lives and take action to make changes. In fact if I DON’T do this then I am doing them a disservice. I am not there to make them feel content and happy, or they won’t commit to change, and the key reason I am speaking to them is to create the environment for change.

I am still not terribly comfortable making people feel uncomfortable, but I believe that if I can connect to the deep love which I feel for them underneath it all, and serve them with all my heart, then I can both hold them and stretch them at the same time.