In obsolete times, There was almost nothing like laundry equipments.
Laundry happens by the riverside or in bowls.
Laundry was so stressful and time consuming then.
For instance, the ancient laundry came with stamping of feet on the clothes especially clothes like Jeans.
Lines and grasses did a good job in airing and drying of clothes after washing.
However, technology has made everything easier, hence, laundry equipment was brought into existence. This why laundry service business is one of the lucrative business to start with less than 300k
“Are you in the class of people who do not enjoy doing laundry especially when you don’t have the right laundry equipment and tools?”.
Then, this article is for you. Do you wish to launch a laundry business? Download this detailed laundry service business plan. This business plan illustrates how you can earn up to $28,000 dollars doing laundry business from scratch.
In this Article, we have been able to give you a clear and comprehensible meaning of laundry processes and laundry equipments, Steps to an easy laundry process and 10 laundry equipments to start with.
Laundry simply means the act of washing of clothes or textile materials.
Moreover, it is also said to be a place where clothings or textile materials are washed.
There are two types of laundry;
1. The in-house laundry.
2. The commercial laundry.
Laundry processes are the step by step procedure to follow in the act of washing of clothes or textile materials.
The laundry process is defined as the act of;
This is done by adding water to the bucket, ensuring that the fabric is well covered by the water, adding the necessary detergents or stain remover and stir it till the stain dissolves and allow to rest for 15-25 minutes before washing.
washing is a popular method of cleaning a cloth, usually with water, soap or detergent.
Furthermore, the time of washing varies between the extent of dirts in the clothings.
This is very similar to washing, usually with cold water.
The difference is that it dilutes the dirt and the detergent.
Drying is the act of removing moisture from a clothes or textiles, usually after washing.
This is the act of using a heated iron to remove wrinkles and aids in the killing of germs through heat.
This is the act of bending clothes to cover part of itself.
Most importantly, Before taking in the neat clothes , you should fold them neatly.
Laundry Equipment are tools and machineries used in laundry services.
Commercial laundry equipments are used in professional textile laundry and used by all companies that are offering textile laundry and management services.
Steps To An Easy Laundry Process.
1. Sort the clothes.
2. Choose a Detergent preferably an all-purpose detergent.
3. Select a Water Temperature and Cycle on the washing machine.
4. Check everything to ensure it was done properly
5.Load the Washing machine with the clothes and wash
6.Unload the Washing machine
7. Load the Dryer.
8. Unload the dryer and Air properly.
12 Essential Laundry Equipments To Start With.
The washing machine is the most important laundry equipment in the laundry room.
Most importantly, it is advised to go for a machine that has the capacity to handle the kind of laundry you intend to be doing and still fit in comfortably in your laundry room.
Constant cleaning of the washing machine is necessary for the machine last long.
This applies also to all equipments.
2. Dryer/ Drying Machine.
Drying machine is an equipment that is more convenient and less stressful to use the dryer than having to hang the cloth outside.
However, you should also check the dryer often to ensure that ther e are no debris left inside.
3. Clothes Drying Rack.
Ths crying rack is an essential laundry equipment for airing clothes.
Some items of clothing like towels don’t do so well in the dryer hence drying rack is needed.
Its is convenient too.
The iron is best stored in the laundry room.
Ironing is done to remove creases from clothes.
Also, the heat from the iron helps to kill germs and prevent spread of disease.
Meanwhile, clothes that stayed in the dryer for long should NOT be ironed to prevent wearing off of the cloth.
Related: Laundry Products: List of best laundry products for a successful laundry business
5. Ironing Board.
There are different kinds of ironing boards but the best kind of this laundry equipment is the Fold-out ironing board that can be removed when not in use.
Consequently, This helps to conserve space in the room.
The presence of sink in a laundry room helps you to easily handle stains in clothes, hand-wash light clothes and keep everywhere tidy.
Every laundry room requires a good detergent.
It should be budget friendly too.
Meanwhile, An all-purpose detergent is a necessary in the laundry room.
8. Stain Removers.
It is however important to have these stain Removers handy because clothes get stained frequently.
And again, discover what works for you and your laundry.
9. Baking soda.
This plays a great role in removing odours and stains from clothes.
It’s a type of cleaner.
Also, baking soda should be handy and always kept in the laundry room.
10. Laundry Additives.
Additives like bleach, vinegar, etc can help in making washing very easy.
They play a great role in laundry services.
11. Sewing kit.
This is the kit you store materials for mending or stitching torn clothes.
However, The stitchings are to be done during sorting or before washing.
Storing of some products here are okay too.
12. Waste Bin.
All laundry room needs a waste bin for little wastes from the laundry services.
Conclusively, Ensure there is a dry towel always on the floor to prevent slipping and falling.
If you intend to start a laundry service business plan, we have put together infallible laundry service business plan to help you set up a laundry business from scratch and start earning right away. click on laundry service business plan to download.
Financial Risk Management: All you need to know (+practical examples)
What is Financial Risk Management?
Financial Risk Management is the exercise of analyzing potential risks ahead, its identification, and the provision of solutions to curb the risks. In making business plans, the ability to manage the risks soundly determines the level of profit and losses involved in the establishment.
Read More: Financial Intelligence
Importance of Financial Risk Management.
It is no doubt that the sustainability of investments or financial resources depends on the risk management factor. Financial Risk Management aids you to monitor, point out, and take charge of your capital, savings, and income. In doing this, one avoids business breakdown. Financial emergencies, management errors, legal liabilities, accidents, and natural disaster leads to financial risks, but when properly managed brings a sure guide to the organization or individual during the hard times. Financial Risk management is very prominent for an establishment to be successful. It also majors in reducing losses and escalating returns.
Types of Financial Risk Management.
Comparatively, there are different types of risks that an organization can face and the division is in three main branches. That includes:
#1. Enterprise Risk:
These are risks by businesses to increase profits and uphold quality shareholding values. For instance, some companies diversify their products into sizes or different packs to gain sales and new investors.
#2. Non-Business risks:
It Arises from a lack of control by the firm. That is, they arise from general economic imbalance or government policies.
#3. Monetary Risks:
This is connected with the losses of the organization, insufficient sales, a drop in interest rates, currencies, and loss of shareholders.
Other types of Financial Risk Management are:
#a. Market Risk:
This type of risk arises due to the movement in the prices of financial instruments. Market risk can be classified as Directional Risk and Non-Directional Risk. Movement in stock price, interest rates, and more leads to Directional risk. Non-Directional risk, on the other hand, can be volatility risks.
#b. Credit Risk:
This type of risk arises when one fails to fulfill their obligations towards their counterparties. Credit risk can be classified into Sovereign Risk and Settlement Risk. Sovereign risk usually arises due to difficult foreign exchange policies. Settlement risk, on the other hand, arises when one party makes the payment while the other party fails to fulfill the obligations.
#c. Liquidity Risk:
This type of risk arises out of an inability to execute transactions. Liquidity risk can be classified into Asset Liquidity Risk and Funding Liquidity Risk. Asset Liquidity risk arises either due to insufficient buyers or insufficient sellers against sell orders and buys orders respectively.
#d. Operational Risk:
This type of risk arises out of operational failures such as mismanagement or technical failures. Nevertheless, Operational risk can be classified into Fraud Risk and Model Risk. Fraud risk arises due to the lack of controls and Model risk arises due to incorrect model application.
#e. Legal Risk:
This type of financial risk arises out of legal constraints such as lawsuits. Whenever a company needs to face financial losses out of legal proceedings, it is a legal risk.
Financial Risk Management Process.
Financial Risk Management process is the skeleton of motions to curb financial risks. These steps are:
#1. Risk identification:
Be that as it may, this is the first step to take in Financial Risk Management. It is pertinent to know the risk associated with your operating location. Since the risks can be visible the organization can now profer solutions to deal with it both online and offline and even in terms of the report.
#2. Risk Management:
Provided a risk is identified, the depth of the risk can be determined. In this process, you point out the harshness of the risk to the business. Then you can now take steps, know if is a major or minor risk, document it, evaluate it, and map out how to curb it.
#3. Risk Ranking:
The level of risks should be classified and prioritized and also the security of risks is seen and this ranking gives the organization a whole view of the risk they are exposed to. Higher risks are ranked first before lower risks for immediate attention.
#4. Risk Treatment:
All the risks that were identified, analyze, and ranked need to be treated as soon as possible maybe by connecting with risk experts concerning the type of risk and its solution. Risk treatment involves setting up meetings with shareholders and experts needed, so everyone can see and discuss the problem and the best ways to deal with them.
#5. Risk Review and Monitoring:
In treating risks, not all risks can be solved at once so those yet to be solved around often reviewed and monitored including those risks that are always present like the market risk and environmental risks. Meanwhile, employees keep a close watch on the risks. Similarly, Risk management is a practice in all sizes of businesses. Small businesses do it informally while big ones do it formally.
#5.Financial Risk Management Techniques.
Here are some techniques involved in financial risk management:
- Risk identification: In reality, this helps pointing out the risks to which the organization is exposed to is and is the first step of the process.
- Assessment: By leveraging a mix of qualitative and quantitative techniques simultaneously, each identified risk is assessed to estimate the scale
- Prioritization: The risks are then placed in hierarchy various methods, most commonly through a map of the estimated risks against a matrix that measures likeliness and impact
- Risk Response: Businesses will then need to look at the assessment and come up with an action plan whether it may be to implement a tool or tactic
- Implementation: Above all, after coming up with an action plan to move forward with, the business would need to implement the plan and monitor its performance
#6. Examples of Financial Risk Management.
The various examples of Financial Risk Management appears in daily markets and investment processes like car loans, mortgage instalments, insurance, student loans and even when people borrow money from banks to pay back wit an interest rate or use their own money to set up a business. More practical examples are the deep thinking we do before setting up a business, diversifying our brands and when a person evaluates the organization debts, incomes and monitor his/her enterprise.
#7. Financial Risk Management Courses.
Certainly, below are some courses on financial risk management one can take for professional and business growth:
1. Statistics in business.
2. Business legislation and compliance.
3. Organizational ethics
4. Risk management process.
5. People-related management.
6. Legal risk management
7. Master class private equity.
8. Accounting and financial analysis.
#8. Financial Risk Management Certification.
You can obtain these certificates by doing Financial Risk Management courses either online or offline. However, to receive the FRM designation, candidates must successfully complete a comprehensive, two-part exam and complete two years of work experience in financial risk management. Professionals who hold the FRM designation can also participate in optional continued professional development.
Be that as it may, the certificate can make you a consultant in Financial Risk Management. Some of this includes:
- Certified in Risk and Information Systems Control (CRISC)
- Certified in the Governance of Enterprise IT (CGEIT)
- Project Management Institute-Risk Management Professional (PMI-RMP)
- Information Technology International Library (ITIL) Expert
- Certification in Risk Management Assurance (CRMA)
Read More: PRINCIPLES OF FINANCE
Personal Finance: Basics, Importance, Types, Management ( + Free Softwares)
The ability to manage your finances properly is the first step to achieving that financial goal you have in mind. Whether you are a spendthrift or not, you still need an understanding of what personal finance basics is all about.
It’s benefits are endless.
Take a look at the richest man in the world today – Elon Musk. With all his finances and riches, you never hear where he was seen making unnecessary purchases.
Musk is so invested in his company Tesla, that when it progresses, he progresses. Some times he sleeps in his factories with his workers.
Now, you may be wondering, what would a man who has it all possibly be doing in a factory?
Truth is, he had basic understanding of personal finance right from his young age and that greatly benefited him.
So, if you want to learn what he knows on personal finance, it’s no mysterious thing. Just keep reading this article.
What Is Personal Finance?
Personal Finance is a term that describes the process of managing your money in the form of budgeting, saving, or investing. It is a broad term that describes banking, insurance, mortgages, retirement planning, tax, and several other activities that you do with your money.
When planning your finances, you would take into consideration the several risks associated with finances and future life events that are bound to occur.
Additionally, you’d check out several bank products and discover which of them suits your needs. Bank products range from checking accounts, savings accounts, credit cards, to investment private equity that includes the stock market, bonds, and mutual funds.
In general, personal finance is needed to help an individual or a family make meaningful financial decisions in their life.
Why Is Personal Finance Important?
Personal finance is about meeting your personal financial goals. Hence, its important you plan your finances properly to enable you have enough for all of your financial needs. Whether its for short-term financial needs, planning for retirement, or saving for your child’s needs. It all depends on how you manage your personal finance.
It is very important that you take charge of your finances. However, there are more pressing reasons as to why you really need to do so.
#1. No formal education for personal finance
Experts say that to properly manage your finances, you need to become a financial literate. However, most countries do not have formal education on how you can manage your personal finances.
As an individual, you learn how to manage your personal finances on your own, mostly through personal experiences. There is no formal education at the elementary or basic levels that teaches you how to manage your personal finances.
No straightforward curriculum that teaches you the difference between needs and wants to help you make better financial choices. Instead, individuals pursue learning to earn a livelihood.
This shows that it’s important to learn about personal finance as early as you can. As there’s no laid down rule you can refer to when the debts keep piling up and you are overwhelmed with all your expenses.
HAVE A PROJECT AT HAND? READ THIS PROJECT FINANCE: Simple Guide to Kick start any Project(+ best picks)
#2. The expenses never end
Whether you have an income or not, there’s always something that needs your money. It could be the medical bills, rent, house mortgage, groceries, etc.
In the US, medical insurance is covered by employers, private insurers, or the federal government. In fact, it is mostly for senior citizens and still doesn’t include some medical bills like chemotherapy. While in Europe, most of the medical care is nationally reimbursed.
Regardless, you still have other expenses and if you don’t have a basic knowledge of personal finance, you may go into depression.
#3. Ensures that you maximize your money
Having good knowledge of personal finance will make you look beyond money being a reward for working 30 hours a week. You’d realize that it is a tool to having financial security and aceiving that financial goal you’ve always wanted to achieve.
It enables you have a plan for your money and how you can maximize it to work for you. Additionally, you’d be fully equipped with the knowledge that you need to face financial challenges, opportunities and responsibilities.
#4. Manage your income
It’s in human nature to please ourselves. We’d naturally shy away from pain and move towards anything that gives us pleasure.
This means that if you don’t plan your income, you are more likely to spend it all on buying trivial things that you really don’t need.
However, with proper knowledge of personal finance basics, you can manage your income in such a way that you spend what is necessary and invest or save the rest.
Additionally, you’ll know which expenses are most important and which should come later. Then you’ll know which to pay for taxes.
#5. Financial security
Financial security is something that everyone dreams of. Everybody wants to be assured that they can cater for the needs of their family whether the economy is failing or not.
The COVID 19 Pandemic really showed everyone the importance of financial security and how having a savings you can rely on in difficult times helps to save lives.
No one wants to think that they’d go broke or begging when difficult times come. Hence the need for personal finance.
Good knowledge of it gives you peace of mind. As you are rest assured that regardless of whatever happens, you have the finances to literally keep you alive.
Types of Personal Finance
Earlier in this article, I told you that personal finance is a broad term that describes all you do to manage your income.
Similarly, it’s the combination of several areas that make up personal finance. Hence, for you to have a comprehensive understanding of it. We need to discuss these areas in details.
The areas of personal finance include;
Income is a source of cash inflow that an individual receives according to a period of time. According to Wikipedia, it is the sum of all the wages, salaries, profits, interest payments, rents, and other forms of earnings received in a given period of time.
You can receive income through different sources which can be in form of salaries, bonuses, wages, dividends and pensions.
In general, you can say that income is anything that brings money into your pocket.
An expense is the outflow of money to another person or group usually to pay for another item or service. (It is not an investment).
According to Wikipedia, it is an outflow of money, or any form of fortune in general, to another person or group to pay for an item or service, or for a category of costs.
Expenses can come in different forms. For a house, its expense is called rent, for students or parents, tuition is an expense.
In general, expense is anything that takes your income out of your pocket. If your expenses are greater than income, then you really need to be careful as that’s a red flag and you may be on your way to a lot of expenses.
Saving refers to the amount of money left from your income after you have done all your expenses. If there’s a surplus from what you earn and what is left after spending, then that is your savings.
Savings is the most critical aspect of personal finance. This is because, your ability to manage your finances and save determines if you really have a basic knowledge on personal finances.
Fortunately, there are several methods of savings. Financial institutions have created several means through which individuals can either get reward for their savings or save their savings.
Although it’s good to have savings, it is not advised to have lots of it, as it doesn’t return any interest rates. Which is definitely not what you want. Because you want to continuosly increase your income.
Investing involves putting your money into a business that generates rates over time. There are several investment platforms designed to help you get the value for your money and even more.
Conversely, Investing can be very risky. This is because some investment opportunities may seem fruitful initially but due to bad investment strategy, things can go south.
Regardless, there are some trusted investment opportunities like; stocks, mutual funds, bonds, real estate, private companies, etc.
Insurance refers to protection against unforeseen circumstances to a property. There is a wide range of products designed to offer protection to the property. They include; Life insurance, health insurance, and lots more.
Insurance is another area of personal finance where people seek professional advice. Things can easily get complicated so it’s best to seek professional advice who can carry out several analysis to determine which insurance is best.
These areas, when put together form personal finance, and make it a very vital part of human existence. This is because managing your finances well, can even elongate your life.
Proper Personal Finance Management Strategies
Personal finance is a must for everyone. So, the earlier you learn how to manage your finances, the better. Here are the best tips and strategies to win this thing called managing your personal finance.
#1. Create a budget
Preparing a budget is essential for managing your personal finance. It is your best shot at achieving that personal financial goal you have set for yourself.
According to Investopedia, one method that proves to be most effective in creating a budget is the 50/30/20 percent rule. Let me explain.
- 50% of your income goes into settling all monthly expenses (e.g electricity/water bill, taxes, and several other living essentials.
- 30% of your income goes into settling personal needs ( e.g money for shopping, salon, etc)
- While 20% of your income goes towards your future. You can use it to save or invest.
The truth is, its not easy to manage your money. However, with the range of available budgeting apps, you can stick to your financial plan and hit your goal.
#2. Reduce debt
This is pretty straight to the point. Reduce debts. Don’t spend more than you earn. resist the urge to always go for something you can’t afford. If you can’t afford it, then take your eyes off it. Don’t even go into debts. But if you do, then don’t let it go out of hand.
Conversely, debts can be advantageous over time. Especially if it leads to acquiring an asset, or is more economical at the moment.
Regardless, try to stay within your budget. I think its the most important personal finance basics you must learn. As it’ll help you manage your finances properly.
#3. Use your credit cards wisely
Although it’s almost impossible to not have a credit card in today’s world, it’s more important that you use it sparingly. This is because they can be very tricky.
I’ll explain. Using your credit cards can help to improve your credit ratings and track your spending. Which is totally good for managing your personal finance. But, if you keep making purchases, you may forget to pay your bills. And one way to ruin your credit score is to pay bills late.
In general, just manage your credit cards correctly.
#4. Monitor your credit score
Your credit score is determined by your credit card. So, monitoring your credit spending goes hand in hand with monitoring your credit score.
This because, if you want to obtain a mortgage or any type of financing, you’ll need to have a solid credit history. Factors that determine your credit score include your credit history, credit payments, and your debt-to-credit ratio.
Usually, credit scores are calculated between 300 and 850. So aim to be somewhere between 650 and above.
It’s best to set up an automatic payment system where you get directly debited to pay your bills monthly. This way, you never miss a payment.
Additionally, you can subscribe to receive free credit score updates, to enable you monitor your scores well.
#5. Create an Emergency Fund
Before going on a spending spree, ensure you have some money saved up for emergency situations.
As humans, we live in so much uncertainties and urgencies. The car can go bad, your spouse can suddenly fall so ill, the rent may become due sooner than you expected. Hence, one way to ensure you are prepared for any situation is to create an emergency fund.
Financial experts generally suggest that you save 20% of your income monthly for emergency funds. It’s not a one time thing, continuously save your 20% every month. This way you are building your future.
#6. Pay off your student loans
As soon as you have a stable income source, pay off your student loans. There are loan-payment reduction strategies available to graduates.
If you can’t pay all the loan at once including its interest, you can pay off the principal amount first before the interest rates.
Additionally, if you can minimize payments to just the interest rate, then by all means do so. It saves you a lot of money and you can invest it somewhere else.
READ THIS POST ON: Student Finance: Grants, Loans, Applications (+ How to Start Guide)
#7. Remember your family
If you have built your personal finance up to a point where you have a lot of properties and assets, you can ensure your wishes are safe when you die by creating a will with your lawyer.
You can also teach your children the value of money at their young age to enable them manage your finances and properties better when you hand it over to them.
Depending on your needs, you can set up a few trust funds for them too. Either way, look into several financial management structures and determine which will be best for you and your family.
#8. Save for Retirement
The best time to start saving for your retirement was yesterday. The more time you waste in starting your retirement fund, the longer you’d have to work before you retire.
You wouldn’t always be this young, strong and vigorous. Maximize this moment now and save towards your future.
Although there’s no particular amount that you’ll need to save for retirement, I suggest you save multiple amounts of your salary as you get older.
For example, At 25, your income is $100/hr. So you can save $20/hr towards your retirement. Now at 40, you work at the best Law firm in New York and earn $500/hr. You can now save $100/hr for retirement. Now that was your entire salary at 25.
The aim is to have more times your salary as your retirement fund as you grow older.
Additionally, you can use special accounts that give you beneficial tax breaks. According to CNBC, Many workplaces offer retirement accounts that you contribute to, such as 401(k) and 403(b) plans — the former by private employers, the latter by nonprofits and the government.
With both 401(k)/403(b) plans and IRAs, you may be able to choose between a “traditional” account or a “Roth” account. The difference is when you grab your tax break.
#9. Make use of your tax breaks
Every year, save receipts and track expenditures for all possible tax reductions and credits. A tax reduction deduces the amount of tax you get to pay on your income. While a tax credit reduces the amount of tax you owe.
So figure out when you have any and focus on taking advantage of the opportunity when the time comes. This is one of the personal finance basics you must learn.
After you have saved up your millions for just saving purposes or retirement, give yourself a break and invest. It’s time to make your money work for you
Get a brokerage firm if you can and have them manage your investment portfolio. You are permitted by the god of finance to enjoy the fruits of your hard labor.
Personal Finance Software
Choosing the best personal finance software depends on what your financial goals are. Some software help you with budgeting and expense tracking, While others help you with investment management.
Regardless, I recommend you clearly define what your financial goals are and use software that helps you meet that target.
Below are some free and paid personal finance software that you can use.
GET TO KNOW THE PRINCPLES OF FINANCE
Personal Finance Books and Courses
These online learning centers have proven to give out the best knowledge in collaboration with top schools in the world.
A proper understanding of personal finance basics and management will help you live a better life.
Don’t wait till you start earning in tens of thousands of dollars before you save. The time to save and manage your finances is now.
I hope this post helps your financial life.
Property Management Business: All You Need to Start From Scratch (+ a Workable Model)
“It’s time to start my own property management business.” You’ve said to yourself. However, there are a lot of things to do, learn, and check for. It may seem easy to do especially if you’ve worked as a property manager before but there’s a lot of work to be done.
Property management is a business that involves managing properties and people such as landlords, tenants, and lots more. And it comes with its own risks and challenges.
For those who can comfortably manage people and properties, this can be a very good career option.
Regardless, whether you can comfortably manage people and properties or not, the truth is, you are here because you want to start a property management business.
So, let’s get started!
What Is Property Management?
Property management is the overseeing of one or multiple properties – residents, student housing, commercial buildings, or industrial buildings.
According to Wikipedia, it is the operation, control, maintenance, and oversight of real estate and physical property. It is also the management of personal property, equipment, tooling, and physical capital assets that are acquired and used to build, repair, and maintain end item deliverables.
The owner and manager can be one person. Additionally, a real estate investor can decide to hire a property management company to oversee all of his property investments.
Who Is a Property Manager?
A property manager, also known as an estate manager is a person who manages, oversees and operates a real estate property when the owner is unable to do so.
A property manager has a primary responsibility to the landlord or property owner and a secondary responsibility to the company.
Similar to real estate managers and community association managers, property managers operate the business of property management and must be licensed for the profession.
Property Manager Roles and Responsibilities
Generally, property managers oversee and manage buildings and other real estate properties for their owners. Here are their other functions.
- They handle everything about the rent of a building. Property managers are responsible for dealing with rent issues, collecting rent, adjusting, and increasing the rent if need be.
- They are responsible for searching for new tenants or buyers for a building. If there are vacancies, they advertise the space and meet with potential tenants or buyers.
- Property managers maintain the financial records of a building and manage its budget. They keep thorough financial records of the building and operate within the specified budget for a building.
- Property managers are responsible for keeping the property in good condition. They conduct routine maintenance, repairs and updating of facilities. Similarly, when there’s need for renovation, they hire someone to do the job.
- They assess tenants who want to live in the house by running background checks on their employment and credit card status.
If this seems like something you can do, then you are on your way to becoming a very good property manager.
How to Become a Property Manager?
If you’ve decided to enter into the property management industry, the processes are a tad easy.
Firstly, to get the best of opportunities, you need to get a degree in either business administration or real estate, or any relevant field as stated by the Bureau of Labor Statistics (BLS).
Afterwards, you need to get a license. Most states require you to get a license so check to see if your state is one of them.
Next, since you’re just starting out, you’d have to start as an entry-level employee and work your way towards the top.
Subsequently, you’d learn everything about property management and make valuable connections that would help you when you eventually start your own property management company.
Property Management Company Requirements
Before you can work at a property management company, there are some skills you must possess. This is due to the nature of the job. And sharpening these skills gets you to the top of the adder quickly.
- Ability to be well organized
- Knowing how to connect and empathize with people
- Ability to be creative under urgent circumstances
- Ability to communicate with potential buyers, and residents
- Strong customer service skills
- Knowing how to create good working relationships.
- Must have basic knowledge of local, state, and federal housing laws.
- Financial reporting
- Facilities Management
Is Property Management Business Profitable?
Yes. Property management is a very profitable business. In fact, according to PayScale, the national average salary for property managers is $50,436/year. For higher experienced property managers, they earn $59k per year. While an entry-level property manager with less than 1 year experience can expect to earn an average of $41,059.
LEARN CUSTOMER RELATIONSHIP MANAGEMENT (CRM): Definition, Tools, and Importance TO HELP YOUR BUSINESS GROW.
How to Start a Property Management Business
Starting a property management business is similar to starting any other commercial business. As long as you follow the right procedures, you are definitely on the right track.
So, here are the steps to start a property management company.
1. Draft a Business Plan
Having a good business plan can help you make better decisions. Take some time out, stay focused, think about what you want your business to be like and what exactly you intend to do.
Consider your long term and short term goals, what kind of services you intend to render, how to handle maintenance, how to hire a team, and how to structure your team. Answering these questions will give you a clearer view of what you want to do.
Let us do the thinking for you. There are several other things you have to focus on doing to get your property management company up and running. Hence, you don’t have so much time to spend on drafting a business plan.
You can choose any from our catalog of business plans designed for your business to succeed. These plans were put together by experts in business management and all factors have been put into consideration including market research and analysis.
So, waste no more time, click on the button below to get started with it.
2. Brand your business
After you have drafted a business plan, the next step is to brand your property management company. This means that you have to come up with a business name, logo, and business card.
More so, it’s your business name that your customers will remember, and will be used to carry out transactions. So, when thinking of a business name, be sure to create something clear, simple, and unique to you.
Resist the urge to make it mysterious, that its only you that it makes sense to. If your customers find it hard to understand, remember or pronounce, that’s bad for your business.
3. Determine the Legal structure of your business
The next thing is to establish a legal entity for your business. This means that you have to determine what type of legal entity you want to do business as. This will determine the taxes you’ll have to pay, investment properties, and paperwork to file.
There are four types of legal structure for a business. They are:
- Sole Proprietorship: This means that you are responsible for your business profits and debts. It is the most basic business structure.
- Corporation: This is entirely different from the owners. corporations can own properties and are held accountable to pay taxes.
- Partnership: A partnership is a shared responsibility between two or more people who are liable for a business
- Limited Liability Company(LLC): This structure allows owners to limit personal liability. However, they still get to pay taxes and enjoy other benefits.
Generally, most property management companies operate as a Limited Liability Corporation (LLC) or an incorporated business (S or C-Corporation). And you can decide by going to your state’s official site; you’ll find information there. Or you can hire an attorney to do it for you.
FIND OUT WHICH Business Model: Definitions, Examples, and Types IS SUITABLE FOR YOUR BUSINESS
4. Obtain a License
Not all states require a license for property managers. However, before you set up your property management company, make sure to check if your state requires a license. If they do, ensure you have the license to practice in your state.
5. Organize your Finances
The next major part of starting a property management business is your finances. You need to consider your revenue and expenses.
Now, to properly do that, you need to set up your property accounting. Keep track of your owner’s properties, as well as money coming in and going out. Money coming in – revenue can be from rent or management fee while money going out is from expenses made on the property.
Keep your records monthly, quarterly, and yearly. This will enable you to understand if you’re making more profits than loss or vice versa. Additionally, it’ll help you set more realistic revenue goals.
6. Set up your office and website
Just like every other business, you need a place where you can operate from. So, get a good place where you can meet with your clients, discuss properties, respond to email, and receive uninterrupted phone calls.
Often times, most property managers choose to work from home to cut expenses. And as soon as business starts growing and expanding, they can hire staff and rent a commercial space to serve as the office.
Whichever way, set up your office with equipment and stationery designed to make your work easier.
Also, build a website for your property management business. In this time and age, the internet is the go-to for anything. A lot of people prefer to go online to search for property managers around them, so you would want to be part of the team.
Ensure that your website can be used by both you and your clients. It makes your work easier for you.
Additionally, employ the use of the best SEO (search engine optimization) practices to make your website more visible and easily discovered by your potential customers.
7. Create a marketing plan
Well done for getting to this point in this article, you’re half way to setting up that successful property management company you’ve always wanted. Moving forward, the next step is to create a marketing plan.
You need to understand that customers wouldn’t just lose their way and find themselves at your office. You need to go in search of them and lure them to you. What other way is there to do that than by marketing?
As a startup, the traditional method of advertising which include word of mouth and referral can be good for marketing your business. However, as you grow, you’d need to reach a larger audience.
So you can hire a digital agency to advertise your business everywhere including all social media platforms.
Also, you can use paid ads on Google to increase your chances of getting new clients.
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8. Set your pricing
Just like every business, you need to determine your pricing structure. Make sure to choose one that brings you enough income while still being affordable by your clients. You don’t want to underprice yourself or become the most expensive.
Since you’re just starting, the best thing is to carry out a local research to determine the prices of other property managers in your area. To help you, here are a few fees that will affect your pricing structure.
- Lease fee: This is a fee for leasing a property when it becomes vacant. Usually, it is equivalent to a month’s rent or a percentage of the rent. It is a one-time fee.
- Setup Fee: This is a fee that you charge landlords as the cost of opening an account with your property management company. It’s usually around $250 or less
- Management fee: This is the main deal for your business. You can charge this for as long as you manage the property.
So, find out what your competitors are charging for these services. It’ll help you come up with the perfect pricing structure for your property management business.
For this line of business, it is essential to start heavy networking to gain more clients. This is the only way to grow your business and get investment opprtunities.
So, dive into the sea with big fishes. Create connections, meet new people who’ll patronize your business and becoming your long lasting clients. A real estate investment club is a great place to find landlords and investors who can become your clients.
Although this can be time-consuming as it requires constant effort, you’ll get used to it as soon as you start getting results.
10. Build your clientele
Finally, build your client base. Clients from marketing and networking all make up your client base. Give them good customer treatment as they can tell others about you too.
Offer discounts or gifts once in a while just to show them how much you appreciate them and watch your business grow steadily over the years!
Property Management Companies
Below are the top 5 property management organizations.
- Institute of Real Estate Management (IREM). For residential and commercial real estate managers.
- Building Owners & Managers Association (BOMA). For building owners, managers, developers, leasing professionals, real estate asset managers, and corporate facility managers.
- National Apartment Association (NAA). For apartment industry professionals.
- Community Associations Institute (CAI).
- National Association of Residential Property Managers (NARPM). For small-sized real estate property managers, real estate agents, and brokers.
You’re all set.
However, starting a property management business isn’t an easy task. But with well-explained guidelines, you can be successful at it.
Let me know how starting your own property management business has been going so far using these steps in the comment box below.
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