Have you made yourself free of your rental business?

Have you made yourself free?

In August I had a horrible experience.

With no prior warning, a friend my age who runs a holiday rental business had a massive heart attack and died.

It was a terrible loss of a fantastic person, but it got worse. He had done the entire booking and back office part of his business and his wife had done a lot of the polish that resulted in delighted guests. But she knew nothing about what happened behind the scenes.

Happily, after some very serious scrambling, his wife made some quick support arrangements for someone to help while she started to put her life back together.

It made me realise that my business was much the same. Although I had good processes, they were not pulled together in a single document that anyone could pick up and run with. Also my wife and business partner had not been thoroughly trained in the work I did.

I was in exactly the same position as my friend, with the same business exposure. The same double whammy if I were to fall sick.

Time for action.

So I spent a few days putting together all my processes into a well organised folder, and my wife has been trained so if the worst were to happen she would know exactly what to do.  Even better the entire operation can be outsourced within hours. I also put all our processes onto the cloud so we can share them and there is just one version.

Here is my checklist of processes:

  • List of advertising websites, with logins, passwords and payment arrangements
  • Process for enquiries, bookings and reviews
  • All templates
  • Process for taking payments and schedule for staged payments
  • Recording system for bookings
  • Arrangements for cleaning, laundry and consumables
  • Contact details for all suppliers
  • Financial recording system
  • All the other little things that would fall through the cracks

I’m now free to outsource any part of the business any time I like, and free up my time. For example like going on a holiday to a place without internet.

Last year I learned the hard way what it is like to be without internet. We were in Cuba for a few weeks and the promised hotel wireless internet was a mirage. I spent 2-4 hours a day struggling on wobbly internet in a distant hotel, just to keep my rental guests flowing seamlessly. It wasn’t much fun, although I did enjoy other things in Cuba such as the time warp of old cars, old buildings and fabulous music.

There was another way and I was not organised enough to do it. I am now!

HOW DO YOU SHAPE UP TO THE CHALLENGE?

Can I challenge you my reader?

What would happen if you or a key member of your rental business were suddenly incapacitated? Are you chained to your business unable to take a holiday?  Would your business survive?

Do you have a clear set of processes in a readily accessible location? Could anyone pick them up and keep the business running without serious business income loss?

Let me know how you shape up!

{ 18 comments… add one }

  • Judy Calthorpe November 18, 2014, 7:29 pm

    Thank you Rex.
    Very useful information and practical advise. Giving me the headings to start immediately to prepare my rental for a more secure future is a fantastic benefit.
    Love to hear more.

    Reply
    • Rex Brown November 19, 2014, 9:09 am

      Thanks Judy.
      This is a difficult topic emotionally for owners and partners alike.

      The owner may not want to face up to something going wrong, and may find it difficult to know where to start. My checklist is actually the simple solution. It assumes the owner is organised enough to have their templates in one place, and this may take a few hours of organising.
      I’d suggest they all be put on Dropbox on the cloud for easy sharing. It is free for modest storage, simple and easy to see what is going on. Google have a free cloud storage service called Google Drive, but it can be very confusing, especially if you have multiple Google accounts.

      The other person is the owner’s partner. Do they really want to know where the information is and invest time in being trained? My real life example story is a motivator. If nothing is in place before a serious event, it can lead to premature selling of the business under stress, and a very big capital loss. The stakes are high, so it is worth having the backup arrangements in place. This should be shared with an indifferent partner to get attention.

      In future weeks, I’ll keep posting useful tips. Next year, the Rental Mastery book will be available.

      Reply
  • Ann Chandler November 19, 2014, 12:05 am

    We have 6 rentals with our son and daughter. 4 are in New Orleans, La. The city council has passed a law restricting rentals to long term only.
    The other 2 are on the Ms. Gulf coast. With the proliferation of casinos with huge hotels long term only has a real possibility of passing the city councils and/or the tourist commission here.
    I have been investigating with lawyer friends legal ways to rent short term in long term
    only areas. There are legal alternatives.
    All three of us can handle the business- long or short term.

    Reply
    • Rex Brown November 19, 2014, 9:22 am

      Hi Ann, it is good to see you are organised and all three can handle the business. I wish more owners were organised like you.

      The council restrictions issue on short term rentals will hot up over the coming two years. It is being driven reactively by the stonishing growth rate of Airbnb, which is taking local communities and councils by surprise. In some cases, new restrictions are being imposed, and in other places Airbnb is successfully challenging retrictions. If you sign up to http://www.Skift.com, you can get a feel for the current changes. For example there is a legal challenge by Homeaway about a sweetheart deal deal done between Airbnb and the San Francisco authorities.

      The simple but unhelpful piece of advice is to check the regulations in the area BEFORE buying a short term rental, but I’m sure that is what you are doing. In our case, we purpose built Sea Zen (www.seazen.com.au) and made sure the planning folks gave us explicit planning permission first.

      Reply
  • Nick Marshall November 19, 2014, 3:02 pm

    This is such good advice. It is so easy to keep putting off making a plan for when things go wrong. We never imagine that a disaster will befall ourselves. The list above is a good start. If you want a more formalised way of writing up the policies and procedures of your business, I can recommend this site: http://www.theprocedurepeople.com/
    The benefit of documenting your business is not just for a time of disaster but will make the running of your business easier because you can delegate more easily if you have a well documented instruction manual.

    Reply
    • Rex Brown November 19, 2014, 5:46 pm

      Thanks Nick.
      You certainly need to have a system appropriate for your size and complexity.
      In a former life, I was in charge of setting up a documentation system for a national retailer, and finished training all 3000 staff from scratch in 18 months in a totally standard approach. The most important part was deciding what was best standardised (15%) and what should be optional/ local (85%).
      I try and keep my rental processes VERY simple, work hard training my few fabulous cleaners and delegate everything possible to them. All guest decision making answers one simple question – what would I expect as a customer of a world class rental?

      As you say, it is easy to put off making the plan, and hopefully the story helps!

      Reply
  • Antonio November 19, 2014, 10:43 pm

    Hey Rex,

    What a great topic you covered! I’ve been doing part of it but not all and the story you shared makes me want to finish my duty.
    I’ve been thinking about the ‘what if’ possibility and sometimes I struggle with the rejection my wife has to even think something can happen to me. But so is life and I’ve always been a promoter of the ‘get ready in case it happens’ mindset.

    Thanks for sharing, Rex!

    Reply
    • Rex Brown November 20, 2014, 9:43 am

      Thanks Antonio, nice to hear from you.

      Yes it is ironic that we spend a lot of money each year on insuring against small losses, yet our single biggest risk is our own incapacitation!

      I hope this true story will be a helpful motivator for owners and partners alike.
      Rex
      PS readers may not be aware that Antonio is the mastermind behind the very successful Vacation Rental World Summit in June 2014, in which I also spoke.
      http://2014.vacationrentalworldsummit.com

      Reply
  • Mary November 26, 2014, 2:59 pm

    Hi Rex,
    Thank you for this article.
    My husband and I had talked about recording all the key processes down several months ago as I’m the one who does most of this but he would like to be able to when he is not so busy in his full-time work. Just recently, I was able to do this and found it was very useful in updating what we were doing as well as having a record that he could use or our adult children if something were to happen to both of us.
    There is always more refining to do and your checklist gave a couple of other items which need to be added.
    Really interested, also in what you said about Antonio. Will you be sending out information about the next Vacation Rental World Summit? We would love to hear about this. Thanks.

    Reply
    • Rex Brown November 27, 2014, 5:01 am

      Hi Mary
      Looks like you are well on the way to having your husband as a backup AND your children as backup, a lot more than most rental owners, well done.
      I’m finding that my wife is providing some good challenges to our processes as she works through my own checklist and becomes more immersed in the bookings process.

      You asked about the next Vacation World Rental Summit. This was a huge success this year, driven by my good friend the amazing Antonio Bortolotti. I enjoyed being one of the speakers. Coincidentally, he has just published a special offer for the 2014 material at half price. http://2014.vacationrentalworldsummit.com/black-friday-access/
      I am sure Antonio is is working on plans for 2015, right now and I’ll ask him to give me more information I can share with my readers. You may wish to contact him and ask to be put on his mailing list. You can contact him on: info@vacationrentalsecrets.com

      Reply
  • Sheron January 12, 2017, 11:47 am

    My husband and I were just talking about this today. He told me if something happened to me, he would have no idea how to continue. Thanks for a very good article. I like the list and will get to work on getting my business in order.

    Reply
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