Hi guys!
Im struggling at the moment and need a bit of advice if i should end my business service (property management firm). Therefore i like to share something
I am a property manager (fulltime job) and started my own firm at the beginning of 2021. Here I like to refer to my intro-post and my first attemps to start a business. I have a real estate background.
First some numbers:
- 27 Offers to building owners
- 2 customers since January 2022 (2 buildings á 6 units)
- Revenue: ~ 290€/mtl
- Costs: ~ 150€/mtl.
- Initital investments for permits & further training etc. ~ 2.500 €
At the moment im struggling at scaling it up, and i cant get rid of the thoughts that i am wasting my time because of the following reasons:
Cons
- Little chance to scale it. (i used the online tool to grade my idea here: It was a C- or D) lack of time, scale, need, part of control.
- I think it is not fast enough to get a business to live off, because i can manage almost 400 units alone. Depends on the clientel inside the building. (owners or tenants) A regular price in my area for managing a property is 20€/unit which would make 8.000€/mtl.
So they are two types of customers. 1 Owner who rents the building or Many owners who live in it or rent, but share a piece of the property, which means a lot of regulations to pay attention to. For example they decide once a year what things should be done in the owner company. e.g. changing the property manager. Later is more work, more profitable, but slow decision making.
- i looked at two companies to buy, but i recognized that after running the numbers, it would be in one case 2.000€ net/mtl. and the other case 3.000€ net/mtl. profit. Which i turned down because:
a.) i think it was not enough profit. As a employee im earning 2300€/mtl.
b.) since 2021 you can fire the property manager within six months regardless, if the contract term is longer.
c.) reward risk ratio is to low, that means in this sector there a lot of lawsuits and very often owners sue their property manager, if they do a bad job. One of them did.
- Exchanging time vs. money
- in the hard to get employees
- Some years ago it was more fun to work as property manager, but this is fading at the moment.
- feeling stuck in my job and in my business
Some pros:
- recurring cashflow, it´s a cashflow business
- im good at it
- im my own boss, sounds stupid yeah, but i like it to make decisions alone and talk one on one with the customers
- helping customers with their real estate, inspite often they can be very shitty (negative environment)
- i learn a lot of doing business especially sales, which i think is one of the most important skills if you have a service business
- treat customers well, usually it should be ovious, but there a lof of black sheep in this sector
- new regulations force some people to close their business because they dont have the requirements
- a lot of business owner retire soon
- many people dont want to work as a property manager (to stressful xD)
Now my question, if any of you was or is in a simular situation and at which point do you say, thats not worth my time/effort and i going to end this? How long would you stick to it?
What would be a total red flag? I mean i run the idea through CENTS, wasnt that good, but i did it anyhow. I think there is huge need for execution and making decisions, which yeah honestly, i kind of lack at the moment.
And assume your helping customers, providing value etc. what would be a number to say: OK i go for it? 10k a month, 5k a month, 20k a month?
Greetings and thanks for reading.
Im struggling at the moment and need a bit of advice if i should end my business service (property management firm). Therefore i like to share something
I am a property manager (fulltime job) and started my own firm at the beginning of 2021. Here I like to refer to my intro-post and my first attemps to start a business. I have a real estate background.
First some numbers:
- 27 Offers to building owners
- 2 customers since January 2022 (2 buildings á 6 units)
- Revenue: ~ 290€/mtl
- Costs: ~ 150€/mtl.
- Initital investments for permits & further training etc. ~ 2.500 €
At the moment im struggling at scaling it up, and i cant get rid of the thoughts that i am wasting my time because of the following reasons:
Cons
- Little chance to scale it. (i used the online tool to grade my idea here: It was a C- or D) lack of time, scale, need, part of control.
- I think it is not fast enough to get a business to live off, because i can manage almost 400 units alone. Depends on the clientel inside the building. (owners or tenants) A regular price in my area for managing a property is 20€/unit which would make 8.000€/mtl.
So they are two types of customers. 1 Owner who rents the building or Many owners who live in it or rent, but share a piece of the property, which means a lot of regulations to pay attention to. For example they decide once a year what things should be done in the owner company. e.g. changing the property manager. Later is more work, more profitable, but slow decision making.
- i looked at two companies to buy, but i recognized that after running the numbers, it would be in one case 2.000€ net/mtl. and the other case 3.000€ net/mtl. profit. Which i turned down because:
a.) i think it was not enough profit. As a employee im earning 2300€/mtl.
b.) since 2021 you can fire the property manager within six months regardless, if the contract term is longer.
c.) reward risk ratio is to low, that means in this sector there a lot of lawsuits and very often owners sue their property manager, if they do a bad job. One of them did.
- Exchanging time vs. money
- in the hard to get employees
- Some years ago it was more fun to work as property manager, but this is fading at the moment.
- feeling stuck in my job and in my business
Some pros:
- recurring cashflow, it´s a cashflow business
- im good at it
- im my own boss, sounds stupid yeah, but i like it to make decisions alone and talk one on one with the customers
- helping customers with their real estate, inspite often they can be very shitty (negative environment)
- i learn a lot of doing business especially sales, which i think is one of the most important skills if you have a service business
- treat customers well, usually it should be ovious, but there a lof of black sheep in this sector
- new regulations force some people to close their business because they dont have the requirements
- a lot of business owner retire soon
- many people dont want to work as a property manager (to stressful xD)
Now my question, if any of you was or is in a simular situation and at which point do you say, thats not worth my time/effort and i going to end this? How long would you stick to it?
What would be a total red flag? I mean i run the idea through CENTS, wasnt that good, but i did it anyhow. I think there is huge need for execution and making decisions, which yeah honestly, i kind of lack at the moment.
And assume your helping customers, providing value etc. what would be a number to say: OK i go for it? 10k a month, 5k a month, 20k a month?
Greetings and thanks for reading.
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