How to become a vendor for apartments and property management companies

 

How to become a vendor for apartments and property management companies

After a decade of experience in the property management industry, I've learned that there are a few important things that you must focus on to become a vendor for apartments and property management companies. 

This article will serve as a property management vendor guide to help you get more business as a vendor, with the property management companies and landlords in your area.

To understand how to become a vendor for apartments, it's important to first understand how apartment management companies operate.

What is property management, and how does apartment management work?

Like many industries, property management is a niche within the greater real estate industry. 

Real estate in the United States is one of the biggest economic drivers and one of the preferred methods for gaining and building wealth in the country.

As a result, property management companies and high-quality property managers are in high demand all throughout the US.

These property managers are responsible for one thing:

- The successful management of the rental properties

Here's how it works...

1) Someone buys a rental property and decide they want someone else to manage it.

2) They find a property management company, and they sign an agreement with them to manage the rental property on their behalf in exchange for a percentage of the rent collected each month.

3) Often times there are bonuses built into this agreement when the management company is able to manage the rental property at a reduced operating cost. There may be additional bonuses for the management company if they're able to keep high occupancy rates throughout the year to retain optimum cash flow from the rental.

If the property management company fails to perform adequately, the property owner may replace them with another management company (this is a regular occurrence in the property management industry) or take back over managing the rental themselves.

Why become a vendor for property management companies?

Because a property management company is responsible for successfully managing someone else's real estate investment, it's important that they provide the best service possible.

That means that they need to hire the best vendors and service professionals.

And here's an industry secret: Everybody in the property management industry knows each other.

That means that when you get hired by one property manager as a vendor for their apartment community, you just opened the door to potentially get hired by a hundred property managers, and your business has the potential to grow exponentially in a very short period of time.

But be careful.

If you get in as a vendor for an apartment community - and provide less-than-stellar services - you can also quickly find yourself black-listed by hundreds of property managers... because they all know each other.

You should only become a vendor for apartment management companies if you're prepared for what comes next: potentially explosive business growth.

You will still need to be able to continue to provide quality services.

What are the requirements for becoming a vendor for apartments?

In every state, in order to be a vendor for apartments, at a minimum, you will be required to be a legally registered business (e.g. LLC).

Depending on what services you are providing, additional registrations or licenses may be required (e.g., electricians). 

The larger the property management company is, the more likely it is that they will have additional requirements.

They may require: 

- That you be registered with vendor databases like "Compliance Depot".
- That you are bonded/insured with specific coverage amounts.
- That you have passed a background check in the past "x" number of years.
- That you have other property management company or landlord references.

If it's your first experience with the property management industry, or real estate in general, then it's best to start small.

I would recommend that you target some smaller individual landlords who are managing their own rentals, or just small property management companies with limited portfolios in your area.

That will allow you to get some experience in understanding how the industry works, and to get a firm understanding of what landlords expect from their vendors on a smaller scale.

How to create relationships with property management companies?

Like most things in life, becoming a vendor for apartments revolves around building relationships with people in the industry.

You'll need to build trust and provide value. Here are a few ways you can do that:

Connect with property managers online

One of the fastest ways to find property managers, is to go online. You can quickly find them on LinkedIn or even in Property Management Facebook Groups, which have thousands of members from all over the US. 

Just don't hit them with a typical sales pitch.

You'll want to be personal and approachable - be creative and save the sales pitch for later. Just make a connection, let them know who you are and that you're in their area.

Then, gradually follow up with them over time.

If you know where their property is located, you can stop by with some cookies (or something delicious) for them and their office and maintenance staff along with a promotional flyer or letter.

Throw in a few pens with your business name, website and/or phone number on it so when an emergency comes up, they have your contact info. 

It's probably going to take more than one visit over the course of a few months, and it's OK to be persistent, as long as you are professional about it. Just don't ever show up in the office unannounced on a Monday, or between the 1st and the 3rd of the month.

Follow through every single time

This is true of everything in life, but it's especially important when it comes to working in the property management industry. 

When you have made a connection with a property manager and have become their apartment vendor, if you say you're going to do something, make sure you do it!

If you say something will be done in a certain amount of time, it needs to be done in that time frame. If you say that you will be there for an appointment, then be there for the appointment.

If anything comes up that will change the course that was already set, then communication is vital. 

Property managers are often on tight timelines, or need things to happen in a certain sequence (e.g. cabinets installed before the new flooring goes in), and if you show up out-of-sequence, you can mess up their entire process.

Invoice accurately and on-time

One of the biggest issues that property management companies have with vendors is that they are notorious for billing REALLY late.

That is a pain for property managers and property management companies, because they typically operate on monthly budgets and bonuses are issued each quarter for performing under-budget.

If you did work as a vendor for the apartment community in January, and then did not invoice them until April, that would be a HUGE problem for them.

The second issue with invoicing is that invoices are often not accurate or itemized with the work that was done, with detailed information. Simply saying, "Painted unit 101. $327.36" on a handwritten invoice won't work.

And if you invoiced them for an amount that was not agreed to, then the property manager will now have you on an audit list where every time you send them an invoice, they're going to triple check your invoices.

That just adds unnecessary work to their already busy schedule, and they may end up replacing you with another vendor if it happens too frequently.

It's best to use billing software to streamline the process of invoicing property managers, and it's especially important to make sure that you invoice the property management company as soon as you have completed the work.

Tell them thank you

If you are getting a lot of business from a particular property management company or landlord, then make sure you tell them thank you.

Actions often speak louder than words, and that includes the words "thank you". Instead of just saying thank you, show them you're grateful for the work they send your way.

You can do that in simple ways like sending the office a pizza delivery - you can always let them know the day before so they don't bring their own lunches.

Just make sure if you promise to do something like that, that you DO NOT FORGET to send the pizza at lunch time the next day - remember, they didn't bring their lunch because you said you were buying it!

Or just drop off donuts and coffee on a Monday morning (which is almost always guaranteed to be one of their busiest days of the week). Drop the donuts off, say hi and bye and get out of their way for the day.

If you are making a killing on business with them, you can take it up a notch and buy the whole office gift-cards to go bowling, play at top-golf, or some other fun activity that they can either opt to do together, or separately with their own families.

Acts of kindness and appreciation will help for those times when mistakes do happen down the road (and they will). Your transgressions are easier to forgive when you've spent the time and energy to build a relationship.

How to get referrals

The apartment management industry is a tight knit community of real estate professionals. It's not uncommon for a property manager to work for half a dozen property management companies (or more) in a single city over the course of their career. 

That happens a lot because property owners change property management companies, or an owner will sell the property and the new owners have their own property management company and sometimes the original employees at the property will stay on with the new company, or they'll move to another office with the old management company.

For instance, in the span of one year, I personally worked with two property management companies in Houston, TX and worked with some of the same people at both management companies.

That happened because properties were bought and sold and placed under new management, and I was mixed in with the management shuffle.

Because of how the property management industry works, I now know dozens of property management professionals who I've worked with in various capacities.

Each of those property management professionals have moved on to other companies, other roles, etc. As a result, I have connections at quite a few property management companies across the US at nearly every level (leasing agents, property managers, regional managers and VP's).

I say all of that to say this... If you provide quality services, and you've been doing business with a property manager for a while (8 - 12 months at least), then referrals will often just start happening organically.

Your name will start coming up in conversations and you'll start getting phone calls from other apartment community managers; other companies, even.

If referrals don't happen organically, simply let the property manager or maintenance supervisor that you're working with know that you are looking to take on more work and can scale up to meet the additional demand.

Just ask them to pass your name on if they know of other people in the industry needing your services. Or, you can also just ask if it's OK to put them down as a "reference" on your marketing material that you'll be dropping off at other rental properties in the city.

Sometimes all you need to do is ask!