Five Times Faster Profit than Rent Roll Growth

Wednesday, December 06, 2023

When we conduct training, the sad fact is that just about everyone believes the only way to grow your rental department’s income and the profit margin is exclusively by rent roll growth.

When we conduct property management business health checks around Australia we have found on average, the departments that measure their profit margin (as opposed to the profit margin over the entire company including the sales department) have approx about a 20% profit margin.

So for every dollar earned, the boss gets to keep 20 cents (before tax), losing 80 cents in the dollar to expenses (expenses like staff costs, car allowances, desk costs etc).

It makes good sense then if we can grow our income and profit margin without rent roll growth, we do not need to factor in the extra expenses needed to take on a larger workload. We get to keep the 80 cents per dollar as well!

Five times faster

This means for every dollar we earn without growing our rent roll and taking on a permanent extra workload we get to keep 100 cents in every dollar generated- five times more than if we earn extra income through rent roll growth!

In most cases, done the right way using the right strategies we should be able to grow another 20% in income, which in effect doubles our profit margin (if our profit margin is approx. 20%).

What stops this from happening?

We have found that the biggest two things that stop us from earning extra without rent roll growth are our mindsets, and also the fear factor of losing clients.

We know for a fact that if we can get past our perceived outcome on what we think the result could be, we will be very pleasantly surprised at what can be achieved with the property management goldmine contained within the walls of your office!

I encourage you to challenge our mindset and fear and spend time exploring ways you can increase your profit margin five times faster than just by growing your income through rent roll.

All the best!


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