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If you are in the process of selecting or evaluating a holiday rental PMS software you must consider the fact that Genkan now comes with an added bonus—the opportunity to reach Airbnb’s world of travellers, seamlessly.

Genkan is the only true “all in one” Property Management Solution for professional holiday rental managers available today. The Airbnb connection adds to Genkan’s already impressive Genkan Connect functionality which currently supports, Booking.com, Homeaway and Stayz and that commits to adding Expedia, Agoda and Flipkey in coming months.

PRESS RELEASE

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“Hi Glen,

Thank you for your patience. It has been a busy week. The good thing we noticed about your websites is they rank really well in google search results. This is one of the attractions engage in the service you have offered to rebuild the website. Is this because of your linking or seo codes, words. Is it possible that by you rebuilding our website we will gain a better position on google, perhaps even on the first page of results for Accommodation in Nelson Bay or Port Stephens?  Is there any SEO included in the price?

…………………………………………………………………………………………

The point is that this client, as do many, see SEO as a commodity, something you just buy off the shelf which anyone who has gone down this path would totally understand isn’t true…

so in a very straight from the keyboard… here is my response.

Hi ……

This morning you would have received your SEO report, basically showing you have no search engine presence.

Search engine presence is an interesting phenomenon, its not just one element, its a combination and there is no clear cut answer other than to do as much as you can of all the possible things as good as you can but there is no magic bullet like there was in the early years of 2000.

Is there any SEO in the $price quoted for the website, short answer is yes and no. The website is setup and built in a way that should you do the correct things properly, SEO is included, if you don’t then the answer is no. You must go into each of your properties and enter the appropriate SEO info, Rental Meta Tags under the website TAB under properties at a minimum.

The age of your domain plays a role, “how long has this domain been live” Google seems to take great joy in penalising new business, this has been well documented under the Google Sandbox.

One thing I can assure you is you won’t rise up the search engines, that is google won’t lift your site up the search engines if there is no organic traffic going there ” what if people cannot find me how can they get to my site ” I hear you say.  It is probably worth mentioning at this stage that Google’s largest source of revenue is from Google Adwords , so frustrate the new client to the world of web into spending per click with Google.

This is where Genkan helps on several fronts;

1.  The enquiry email. 

You send the email to prospective guests, they click on the link, that creates regular organic traffic to your site. Using the Stayz PM solution is great here because you get regular enquiries by email which you can respond.

2. The booking manager

Again using the reminder emails and then getting your guests to book and pay online, you send them a link to pay or update their booking, creating natural organic traffic.

3. Surveys

Sending a emails post stay then getting your guests to complete a survey at your site,  creates natural organic traffic.

4. Email marketing campaigns

Sending email marketing campaigns to your database directing them to your website creates natural organic traffic.

Organic Traffic

So Google can now see organic traffic. What else are they looking for  ? 

They want to see people coming from social media places such as Facebook, what they are testing you on is “ are you a real business” 

A question for you … does using a hotmail or gmail email address indicate to google that you are a real business or a pretend ?  Does having a http ( non secure site ) indicate to google that you are a real business or a pretend where a https is possible.

Is your business trading name the same name that’s registered with the domain ?

All little factors but part of the test.

Ensure that you choose a website template that immediately convinces the new arrival to your site that they can do what they came there for. If they are looking for accommodation make sure they can see that they can search book and pay. Everyone is complaining about the OTA’s but what are they doing about it, 90% are playing into their arms and surrendering. Too many ( I believe ) are convinced having a site that looks like AirBnB will get them the same success. WRONG !! 

AIRBNB, STAYZ, HOMEAWAY & BOOKING.COM have already done the hard yards, they have the traffic and therefore they can build sites with this level of design.

Your website homepage design should have at a minimum  400 words in an order that creates relevancy. I can assure you that if I took my high ranking Thredbo Accommodation website and replaced all the words with a large picture I would be off page one in a week.

Google are measuring the time visitors to your site, stay at your site. Unfortunately sometimes the book and pay and surveys above” detracts this score because they only ( possibly ) visit one page and leave.

The enquiry email hopefully engages the visitor to your site and when they get to the property page have great photos that they want to see and watch all of, have a video walkthrough, floor plans that they can study. 

Mobile

Mobile devices, I am not going to rehash all the continuous facts and figures on the increasing usage of mobile. Of course its fact but there is a very conflicting argument here that no one really is in agreeance. My personal opinion and in our business of where the guest has to search, research, compare, book and pay that responsive mobile sites do not work. That’s my opinion. The answer is a fully functional dedicated mobile site that mirrors your website with all the corresponding content. Google might prefer a responsive site but if its a user nightmare experience .. whats the point ? It may pass all the Google insight tests but whats the point if it cannot achieve its goal and I havent seen any user benefit from a responsive mobile site nor have I seen anyone loose rankings by having a properly built mobile site.

All these elements contribute to the final answer which is will for my efforts lift my site up the rankings because  apart from Google testing you on are you a real business they are also testing your site on the relevancy of how it relates to a particular search term. If your site isn’t relevant to what the search term is, then your going no where.  So visitors staying at your site, property pages because there are great photos, all the information, YouTube, floor plans tells google the search was correct. Google want to be successful also.

Links is very debatable but I believe in it and have proven in very recent times that this is an important element. The easiest way is to find places/websites where you can enter your email/website and name at someones blog. Genkan has a blog, go there make a comment and you will get a link back to your website. Too easy but how many do it ?

The last is creating additional unique and interesting content that visitors to your site might share. This is tough and sometimes can go a long time with no reward but others are doing it, help them out, see www.moretonislandrealestate.com.au comment on the blog, or share it.

there is a community out there but most are too lazy or content to be working in their business rather than on it.

And that’s the secret, find time to work on growing the business rather than spending every hour possible in it. Use the Genkan tools to automate processes, take the opportunity to allow the ego to say, lets do it another way because this is the biggest hurdle facing holiday rental managers, go with the flow rather than swim against the tide. Far too many PM’s are stuck in their ways and won’t accept change or possibly a superior way of doing things.

After all we are a marketing business that does cleaning.

Glenn

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Is your Holiday Rental Management business the next corner shop?

Is your Holiday Rental Management business the next corner shop?

From corner stores to independent bottle liquor stores, from local hardware to independent caravan parks and independent hotels, a toughening market and vicious competition have wrought change. Many independents have disappeared from our local areas. I miss my local hardware shop, but he couldn’t survive in a world of big-box retailers like Bunnings and Masters – companies whose business strategies kill off the smaller independent stores. Forecasts are that approximately 6,000 of the remaining independent hardware stores in Australia will disappear over the next 10 years. While specialist stores and online retailers are set to grow, the real winners will be the super-barns.

Where’s our industry heading?

It’s not hard to make the leap from the hardware sector to our holiday rental management business: the smaller businesses fall prey to the similar market pressures that have driven corners stores, liquor shops and local hardware stores towards extinction.

History of property management and marketing

The property management industry is dynamic if nothing else! How we did our marketing and found customers, how we managed our properties, and how we treated our guests even 20 years ago all seem quaint. We put advertisements in newspapers and magazines and listed with the local information centres. We listed and waited, fingers crossed, hoping for customers. The logistics of managing arrivals and keys occupied brain power and lots of time. Bookings all went through staff and were manual. We prided ourselves on our independence – we valued it highly and did all we could to protect it.

Up until about the year 2000, holiday property managers called the shots. They were traditional businesses that managed owners’ properties – they took on all the responsibilities of renting the properties and they had control over the conditions under which renters stayed; they managed cleaning, repairs, payments and profits. Owners and customers were passive in this world.

The advent of the internet jolted property owners and managers out of this work paradigm. A new business universe appeared. Some owners and managers jumped early and embraced the new tools and opportunities. Many jumped in the easiest direction: they opened their doors and wallets to clever and professionally built online marketing channels. Priceline, Stays, Homeaway, Wotif, Booking.com, Expedia, Last Minute and others made it easy for property managers and owners to pay and ‘use the internet’ for marketing.

In Australia, these OTA (online travel agents) channels emerged and provided property owners with an alternative to the traditional property manager model. Owners now had a way to self-manage and put the commissions back into their own pockets and return a greater profit for their holiday investment property. Because they were managing it themselves, many owners discounted the rate that the existing manager was charging. Owners then went out to the market and reduced the price because they had an expense removed. They found locals to clean and repair. A new rental management process was born, and it appealed to the holiday maker because it was cheaper – sometimes much cheaper than market price – and it allowed renters to deal directly with the owners.

In this world, price was the key criterion for attracting customers. In some instances, owners marketed their properties at half the price advertised by the property management company. Becoming even bolder, some owners instructed their property managers to decrease charges or they would take back rental control of their own properties. Property managers complied in order to keep their clients. The holiday maker was the clear winner in such a situation. Except that service levels to guests were frequently decreased and local office or assistance began to disappear.

The gravitational pull of the growing mass of online marketing channels attracted more and more owners away from the traditional model at a time when the market made it easier to purchase a family holiday home. Not surprisingly, the channels became stronger as more owners used it. Eventually, the channels came to control not just individual properties but the market itself.

The internet reshaped the holiday property management industry as it has done to nearly every other industry around the world. It created a change of paradigm and a shift in profit distribution: there were more players wanting a piece of the holiday rental pie. Initially seen as a saviour, internet marketing unsettled the status quo and squeezed businesses…sometimes out. Responding to the online channels, many holiday property management businesses have reduced their management fees from above 20% to below 15% in the past decade at the same as a their cost of acquisition is rising in the opposite direction. In this new, competitive world of online marketing, the cost of customer acquisition has risen many times more than commissions and profits. Customers and online marketing channels have been the winners; owners and property managers have suffered the financial losses.

Internet-based tools are the future of property management, and they are already available for efficiency and profitability. Used well, they can assist with marketing, enquiries, quotes, booking, channel management, communication, cleaning arrangements and maintenance. Used poorly, they can swallow the profits and ultimate viability of property management businesses.

The current state of affairs

Today, we all work in a multi-channel reality. How we each manage to adapt to and use this reality for our success as individual businesses lies on a continuum from poor to wonderful. Where are you on that continuum?

The online marking channels have dynamic, engaging, super-fast websites that provide useful, engaging and relevant information. They make booking easy. They attract customers from everywhere. They collect and keep valuable data on customers (and use it for their own marketing). Clever property managers are benefiting from this. Judicious managers are using the online channels to the best of their advantage, piggy-backing on the strengths and global reach of the channels to win the loyalty of customers once they arrive at their properties.

Watch the checkouts view

Naturally enough, the channels charge for the privilege of using them, and those charges continue to rise, eating into profit margins (fees currently sit at between 15-25% of each booking). Online channels squeeze their users through fees and contracts. In September 2015, the Australian Competition and Consumer Commission commenced investigations into the pricing practices – including pricing parity provisions in the contracts – of the online travel agency market.

Customers are also bringing about change. This world is information-rich and our customers are information-empowered! They are no longer passive recipients of information doled out by property managers; nor are they customers waiting to be asked. They search – they scour – the sites for information and better prices. They ask for better deals. They are tech savvy and they know it. It’s not just technology that’s changing how we do our business, it’s the use of that technology by customers. Indeed, in recent years, there’s been considerable discussion on how consumers are gaining marketplace control. That is, they are taking power away from marketers and retailers. Much of this power shift has come from consumers’ increasing access to almost instantaneous marketplace information via the web and mobile communications. And as consumers have learned more, they have demanded more. The more consumers know, the less effective traditional marketing approaches seem to be. Successful property managers are coming to terms with this democratisation of information and power-sharing, and they are learning to appreciate that customers:

• live on line – some eat, sleep and play online; they are connected most of the time
• expect the latest and most efficient technologies from businesses – not just yours; in every aspect of their online lives, they expect the best
• compare and leverage information in order to exact the best deals and experiences; they seek to optimise their bookings and benefits
• use SMS, phones, APPs and every other possible connection tool
• are beginning to consider such things as add-on activities and eco-friendliness.

As property managers, we need to recognise that we are working in an economy that is becoming increasingly people-centred. Just as new leadership principles recognise the primacy of people, particularly employees, in their organizations, so too must holiday rental property managers. We must put people in the centre. We must keep a focus on the people in our business: trained staff, ecstatic customers, efficient suppliers, real and possible competitors, and potential allies.

Will you become the next corner shop?

Nothing is standing still. Technology is galloping ahead. Marketing strategies are evolving rapidly. Customers are up and running. The balance of control and profits in the holiday rental market shifts almost daily. Longevity in this industry requires us to keep up. Keep up. The bottom line in surviving the dynamic nature of our industry is protecting and improving the bottom line of our businesses. We have to keep up or we get left behind. Efficiency of service, quality of premises and effectiveness of marketing truly matter. But survival in the future will – I believe – require something extra.

Survivors will have to use the best of what’s available in technology and communications. Technologies and the industry are evolving faster than most individual businesses, so keeping up takes focus and effort and investment and awareness. I believe the next dominant species of property managers will be those who evolve to use the latest Property Management System (PMS) software; they will have a new philosophy on the whole business and pick up the majority of bookings from the internet with minimum human intervention; they will have a website that is strong organically and found easily through search engines. Further, they will have integrated information and communication systems that talk to each other. For customers, it will be easy to book and pay on the website.

In the future, there will be no keys; all doors will have digital locks and date and time-stamped door codes that are sent by SMS to client phones at check-in time. The trust accounting component of the system will be so automated and integrated with the bookings and management system that the time spent each month managing the process will be hours, not days or weeks. Maintenance personnel will be notified by SMS and emailed directly from the PMS. The maintenance person will close off jobs directly into the PMS with invoicing and outcomes from their mobile device. In the property management industry of tomorrow, staff will be an expensive luxury, so automation of all aspects will become imperative.

Longevity in this industry will require managers to use the best technologies available. The real change, however, is linked to marketing. After we are a marketing company that does cleaning.

Marketing Survival 101

Survival 101 says managers must be in control of their own destiny, and your destiny is your marketing.

By the way, a holiday rental business is a “marketing business that does cleaning”.

Survival 101 requires us to use the channels as best we can, but not rely solely on them or they will be making profit off our hard work. We will need to become marketing companies and build a website that attracts and owns our customers! We’ll need to ensure the website is aesthetically pleasing, satisfyingly functional, super user-friendly and full of relevant and useful information. We’ll use our websites to create emotional responses of awe, anticipation and surprise. They will be a vital part of our direct marketing strategies, strategies that include opportunities to build customer loyalty when they arrive at our properties. Without a direct booking strategy, the online channels own our customers.

Survival in the future will also require us to learn from the experiences of the individual hardware stores, the corner store hotels and caravan parks.

Two of the major lessons from other independents are about collaboration. Independents have come together to market themselves under one umbrella, and some smaller entities have joined in order to survive.

Hotels work in chains – they work under a marketing arm and bookings are done in a central location. Caravan parks come under the banner of an amalgamated organisation. Independent hardware retailers join HBT, a national buying group with low overheads that suit the smaller stores. The independents have come together to survive and thrive in an environment where the big-box retailers across those sectors are claiming an increasing share of the market.

The time is right for independent holiday rental property managers to do the same or come together as larger organisations. The drivers (competition, global customers, dynamic and evolving customer needs, online channel monsters, costs) and our capacity to do so (technology, communication, networks) already exist. In fact, both are pushing us in this direction and we must grasp the opportunity – or wither as sole businesses.

Amalgamation as a group will allow the group to afford a highly talented marketer who develops a high quality marketing strategy – something out of the financial reach of most independents. Working as a group, visibility will be UP. Selling power will be UP. Buying power will be UP. Costs will be DOWN. We will thrive not just survive.

What could these groups look like?

The amalgamated groups could be under the same marketing company. Here, properties retain their own independence and identity but share costs of marketing. The marketing company promotes our businesses locally, nationally and internationally; it makes it easier for us to work with partners (e.g. frequent fliers, seniors card) because a group looks more attractive than individual properties.

Amalgamated groups allow the potential for a cross-property loyalty club that offers benefits and deals at regional and national levels, with the potential to extend internationally. Groups can also seek awards from state and national tourism bodies.

The possibilities are endless, this is an idea whose time has come.

The post Is your Holiday Rental Management business the next corner shop? appeared first on Genkan | Holiday Rental Management Software.

MIGS in Dubai !

Great news for the 3 Dubai genkan customers with the introduction of the MasterCard Internet Gateway Service – MIGS gateway into the region through Mashreq Bank. The MasterCard Internet Gateway Service (shortened to MiGS) is a payment gateway  system that allows banks to accept card not present transactions  MiGS, which is sold by MasterCard , is PCI-DSS  and is typically branded and priced by the acquiring bank .
It is used to interconnect online merchants to their acquiring banks through standards-compliant technology and API (Virtual Payment Client).
This payment gateway provides support for services such as “MasterCard SecureCode”, “Verified by Visa” and “JCB J/Secure”.

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What does it mean to be ready?

In our business as in all other sectors, nothing is standing still. Technology, customers, marketing strategies, expectations and needs are all changing and morphing as we look at them. Much faster than grass growing.

Long-term survival in this industry of holiday rental management requires us to remain at least parallel with those changes – to keep up to date with technology and people. We need to also look ahead, because the future is also on the move – and speeding towards us but also away from us. Remember, There is no choice, if we are to survive, we must future-proof our businesses.

Not in the sense of protecting ourselves from the future (like fire-proofing protects from fire and water-proofing protects from water), but in the sense of welcoming the future, embracing it, and being ready for it.

Indeed, we have to help create it!

Future-proofing is about anticipating the future and then developing strategies and processes that would minimise the effects of possible shocks and stresses of future events and technological or other changes. Future-proofing is also about being ready to make the most of what happens in the future.

The term “future-proofing” is commonly used in many industry sectors, including electronics, data storage, communications systems, industrial design, computers, health care, sustainable development, climate change planning, and product design. To date, the term has not been used in the hotel rental management industry. I propose to change that.

Drawing on the language and ideas from work in other fields, I have developed a set of future-proof principles for our industry.

Future-proof gurus (and there are several – check Google!) have prepared sets of principles for a range of industry sectors. In the main, these principles apply for material- and product-based industries, not service- or marketing-based industries. And our business is in marketing and servicing.

Below are 10 principles for future-proofing our holiday rental property management businesses. Note that it’s important to build these principles into to your whole operation of marketing, relationship building and maintenance, cleaning, work with trades and suppliers……

Future-Proofing Principles for the Holiday Property Management Sector

1. Know and understand the business you are

Holiday rental property management business is a “marketing business that does cleaning” So where in your business is your marketing professional? After all you are a marketing business !!

Where is your marketing plan?

2. Do no harm – especially to yourself

Get everything right. Ensure your communication and operation systems make it easy for customers and suppliers and trades people to deal with you. Don’t shoot yourself in the foot with cumbersome systems and faulty communications. Ensure your communications, marketing and booking management systems are integrated and smoooooth. You will not, “in the future“ be able to afford anything less.

3. Build long-term relationships

It’s not just about marketing good properties and deals; it’s not just about understanding and meeting customer requests; it’s not just about technology. You need to help your customers, suppliers, trades people and staff establish an emotional connection with you – a bond with you.

This principle is about valuing people and training your staff to do the same. Invest in people as you invest in other changes. For example, help your staff have dialogue with the customers not just solve problems. Help them build intuition and read between the lines of customer needs. Guests want to be respected and feel respected as people, so help your staff learn to deliver not a script-driven welcome but an appropriate, personality-driven welcome. Know your customers, have incentives, build loyalty, train your staff, and be the best property manager the suppliers and trades people have ever worked with.

4. Stimulate flexibility and adaptability

It goes without saying that if you cement your systems in place because they work today, your business will find itself being dragged behind by the weight of that cement! Remain flexible and be ready to adapt; be open to critically assess new ideas and take them up if you believe they can yield greater benefit than your current ways of doing things. This is as much a frame of mind as it is the tools you use, the training and support you provide for staff, the plans you put in place and the business approaches you take.

5. Fortify against competition

This principle is not about castle towers, sturdy walls and a permanently lowered portcullis. Indeed, it suggests thinking that is opposite: being open. Open to the idea of working together, forming alliances and possibly coming together as a larger competitive force. So, lift the gate, lower the drawbridge and welcome others in to talk about how you can survive and thrive together.

6. Innovate to reduce costs

Wherever you can, automate. Automate to reduce costs and failure. Staffing costs will be the greatest burden for any industry on the future, especially the business of holiday rental management.

7. Become data driven

Data matters. Ensure your systems ( PMS included ) captures user behaviour metrics such as rental dates, lengths of stays, and browsing patterns. Then connect the dots: first, to check your assumptions; second, to develop and refine your marketing strategy to suit the information.

Become a data-driven organisation that approaches each business challenge objectively and with as much information as possible. Remember, it’s an ongoing, regularly-refined strategy to survive and thrive that you must keep putting put in place.

Data is gold, real data is invaluable.

8. Invest in knowing what’s coming

Watch and listen. Think about and be aware of what’s coming. Use mainstream and specialist media, newsletters and Google alerts. Attend conferences outside your own backyard and develop knowledge networks as far and wide as you can. Keep growing and testing your own insights into the future.

9. Market yourself to the world

Your website must be your greatest asset. Nurture it, invest in it daily, weekly, monthly. Use it as an important tool in your future-proofing survival armory. Use it to build your own business not someone else’s. Here, it’s vital to know and accept that online marketing channels are not your business. Build an amazing website that your clients love and that speaks to the world.

10. Healthy people, healthy community, healthy planet

Customer expectations about health and low environmental impacts are rising. Customers are coming to expect eco-friendly products and services across all industry sectors. Ours is not exempt. Remember, don’t just say you care, show it – through product choice, use of resources, management of waste, support for local initiatives and businesses, etc.

Commitments and efforts in these directions don’t just win customers. If done well, they can reduce costs and build a network of local businesses that support you.

Ten future-proofing principles for our sector. One for each finger. Remember them. Let them all work together to build approaches that future-proof your business. Apply these principles to build resilience, creativity and future profits.

Glenn Smith
CEO GENKAN
January 2016

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The post Genkan offers Live availability calendars with AIR BnB appeared first on Genkan | Holiday Rental Management Software.

According to the Wall Street Journal, and other sources, “Expedia Inc. has agreed to pay $3.9 billion to buy holiday rental company HomeAway Inc., capping a string of increasingly expensive acquisitions and moving more directly into competition with Airbnb Inc.”

So what does this mean? Well those that follow my newsletters and the Genkan blog will already appreciate my opinion this but here are 3 survival action plans that will help holiday rental property managers survive.

1. YOU HAVE TO BUILD YOUR OWN BRAND

There is no alternative, with HomeAway and Stayz, your individual property listing is about one of one million. When someone is looking for a holiday rental in your area, your competitor’s property is literally right next to yours. Now, the possibility exists not that far down the line that your property will be competing with the hotels on Expedia. HomeAway may continue to operate independently, but with Expedia in the mix, it’s not outside the realm of possibility that over time your holiday rental properties will now have even more competition.

How do you combat that?
You build your own brand! and build that brand on your land !

I am not saying that manager of holiday rental properties should abandon listing sites at all costs because we all recognize that your properties need to be where your potential are. However, if you are 70% or more reliant on third-party sites like Stayz, HomeAway or Booking.com for your business, you need to really think about whether or not you’re comfortable with your business model changing overnight and you having no decision in the matter. You need a strategy to go forward and the bottom line is  Now is the time to regain control of your customer and build your brand before its too late !

2. THE HOLIDAY RENTAL INDUSTRY IS HERE TO STAY

Ok, so that might not be earth-shattering news for anyone currently in the industry, but has there been a stronger statement exclaiming exactly that? Sure, Airbnb is valued at more than $25 billion, but Expedia has now lumped holiday rentals into their broader travel mix that include, airlines, rental cars, hotels, etc. Of course they purchased WOTIF several years ago and WOTIF had been and has been promoting holiday rentals for some time. But what this means to the manager of holiday rental properties is that IF you own your clients and own the territory on which your business grows upon, then you have a valuable asset because this acquisition trail isn’t ending here, get ready to be a a part of it.

3. WILL HOMEAWAY / STAYZ CHANGE THEIR MODEL TO COMPETE WITH AIRBNB ?

The same Wall Street Journal article states, “HomeAway said it could start charging some travellers fees to book properties on top of the commissions it already charges homeowners. This has already been re-enforced by an article in the Sydney Morning Herald in speaking with the local director Anton Stanich

This new fee strategy copies the structure Airbnb uses to collect revenue, though Mr. (Bryan) Sharples (CEO at HomeAway) said HomeAway would seek to undercut its rivals’ overall charges and this was confirmed locally”

A few things to think about:

• Were you planning on raising your tariffs in 2016?
• Will you still be able to raise your rates if HomeAway / Stayz will automatically start charging the guests a fee on top of your listing price?
• If HomeAway / Stayz is trying to copy the model set forth by Airbnb, is it smart to put some listings on Airbnb (the “best” listing model already in place) as opposed to waiting for HomeAway to catch up?
• Is all this too much to think about? Wouldn’t it be better to collect the majority of your bookings directly through your website?

OF COURSE IT WOULD !!!

The best place to take a booking, finalize a booking is currently – and will always be – and directly through your website. Direct bookings are the only way for you to completely control the process, build your brand and own your customers. It continues to amaze me on the number of clients that wont spend $10,000 on their own website but would happily spend 4 times that amount in commissions to listing sites.

If you are ready to take the step to decrease your dependence on third-party booking sites, Genkan is here and has always been here to help. Let us show you how to;

• Turn your Website into pure inspiration to influence decisions.
• Establish an adequate degree of independency from listing sites.
• Increase your occupancy rate with minimal efforts yet smart marketing strategies.
• Make the most of the single most important asset you have – your website and your brand.
• Leverage all streams of traffic possible to your property’s site
• Capitalise on your ever growing database, make it work for you

Visit www.genkan.com.au or call +61 2 99297944 and we’ll set up a time to chat about our unique strategy with the Genkan PMS  that has helps our customers achieve these goals every day !

The post 3.9 BILLION REASONS TO RE-THINK YOUR HOLIDAY RENTAL MANAGEMENT BUSINESS STRATEGY appeared first on Genkan | Holiday Rental Management Software.

Business owners everywhere want their businesses to be worth something! Those in the property management business are no different. After all the long hours, investments, risks, keeping up with changes in technology and customer needs, and a long list of miscellaneous hard work, owners want to know their effort is building value.

Here, I look at two models to calculate the value of your property management business – one for buyers and one for sellers. Play with them. Disagree with them. What models would you use or prefer to use?

To be clear, I don’t have a preference. Neither is perfect – such a model does not exist in our industry. Each is a tool that can be used as needed. My focus is on keeping up, keeping out there, and developing strategies that build profits and remove threats to profitability. More on that later.

If you are in the business of holiday rental management, you:

• Market and promote holiday rental properties
• Accept and manage bookings and reservations
• Arrange the cleaning
• Arrange the trades for repairs and maintenance
• Manage staff.

This is what you do, and the value of your business hinges on the quality of each aspect. The value of a business is what you can sell it for – what a buyer is prepared to pay.

Business value comprises:

1. Management Commissions
2. Commissions from selling properties not under management
3. Profits from linen and cleaning
4. Profits from the supply maintenance work
5. Selling of properties, real estate sales
6. Commissions from ancillary services
7. Return clientele
8. Automation and staffing levels

Here are two models in calculating a sales price.

Model 1 – the Seller’s model

This first model calculates the value with this formula: Total gross commissions X  “Ratio” then adds the net profit from other activities such and maintenance, cleaning and the “on-sell of other items, (  extras such as grocery packs, tours, hire etc.. )

In this model I would be expecting to see at ratio of between 1.5 and 2, so a business with gross commissions of around $400,000 a year value would have a sales value of close to $700,000 plus some input for the value of net profits from other activities.

Where do we get a ratio of 2 from ?

There is general consensus that you would look at the area of the business and firstly understand from a banks position what the value ration of a permanent rent roll is. Banks generally consider a permanent rent rolls value far superior to that of holiday / short term rental. Generally the consideration of the value of a holiday rental rent roll is 60-70% of the value of a permanent rental rent roll. Across the board and from Macquarie Bank figures the ration of permanent rental rent rolls depends upon the actual area and this ranges from 2.5 -3.2.

Example

• “XYZ Property Management” operating at 18% commission
• Total Rental Sales = $2,000,000
• Total Rental Commissions = $360,000
• Approximate Value = $650- $720,000
• PLUS one years net profit from “extra items

Model 2 – the Buyer’s model

A potential buyer might use a formula like this: Total net commissions X a ratio (that is, profit) X ratio).

In this model I would be expecting to see at ratio of around 3.5 – 4.5, so a business with net commissions of around $100,000 a year value would have a sales value of close to $400,000 plus some input for the value of net profits from other activities. As above proven profits from ” other activities” could add significant value to the business when selling.

Example

• “XYZ Property Management” operating at 18% commission
• Total Rental Sales = $2,000,000
• Total Rental Commissions = $360,000
• Net Profit 40% = $144,000
• Approximate Value = $576,000 ( factor of 4 )
• PLUS one years net profit from “extra items”

In understanding the net profit, the salaries of the principle have not been included in cost calculations and remember, a buyer buys profit, not turnover.

There is merit in both models, and the final figure probably sits between the figures each produces. The bottom line is someone looking to purchase a holiday rental property management business is looking at a sell price / profit / return.

The other variables that influence the value of your property management business for sale include:

1. Lifestyle change
2. Availability of a property for sale or inclusiveness of a place to live
3. Growth over the years, is it going backwards or forward ?
4. Seasonality, stable over the entire year or defined seasons
5. The validity of the contracts and agreements
6. Prospect of growth – increase profits
7. Are you growing your business on your land ?

One take-out message for business owners is keep good data.

Fingers crossed or focus?

The bottom line on the matter of the value of your business is….well, the bottom line. That figure will influence what someone is willing to pay for your business.

But do you just hope that your business is going well and its value is high and growing? Do you hope that your bottom line is getting better all the time and is it really your business or are you building your business on the land of another business?If you are this will seriously diminish the value of your business.

My experience tells me that if something is worth hoping for, it’s worth working for. The next article will look at the elements of value above and how you can do focused work to increase the value of your business and prepare it for sale. It will consider how to reduce costs and therefore increase the value of your business (e.g. automation and staff); and it will look at threats to profitability and therefore to the value of the business (e.g. online marketing channels and loyalty of clientele).

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The post How much is your holiday rental property management business worth ? appeared first on Genkan | Holiday Rental Management Software.

I have been in the holiday rental industry now for some 20 years, for some that’s not that long but for many / most in this very quickly changing business I am a grandfather. Well a grandfather since the arrival of the internet.

One of the most significant changes over that time has got to be the cost of customer acquisition.

Lets travel back to 1996 and look at a property that I still have under management. Today it’s weekly income has risen 20% above 1996 however the cost of customer acquisition, mainly bought about the introduction of the world wide web has increased by 1000%.

The newspaper add ( how flawed a financial model was that..) $25 a quarter and it filled 3 months of enquiry, today in the market for the snowy mountains $4 buys you a Google click to your website that may lead to a booking or may lead to 5 seconds of the clients time.

But its not only Google, all marketing, advertising, OTA channels, major promotions loyalty programs all taking their slice of the cake. A cake that previously belonged totally to the holiday rental manager.

In fact revenue acquisition costs have outpaced holiday rental accommodation revenue growth from the day of the internet. Or has it. No not quite, there was a hiatus where the future players were planning their attack, an attack realising the value of the industry.

Google Analytics

Back to Google again, the incredible part of Google in all of  this is that they are poacher and gamekeeper. Google adwords I still believe is the most efficient process of client aquisition. They  as one of the mediums of the increased cost of acquisition then provide you with tools to analyse the efficiencies and conversions.

In conclusion the impact of Pay for click and and the OTA channel ‘s is having such a substantial impact both on revenue growth and profitability of the holiday / vacation rental manager. If rising customer acquisition costs are unavoidable in the near term, then effective marketing becomes even more critical.

See from 2012 www.business2.com.au/2012/01/the-true-impact-of-the-internet-on-holiday-rental-property-management/

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