Aaron Marshall is CEO & Co-Founder of Keyrenter Property Management, the nation’s leading property management and real estate franchise.
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I’m often asked what sort of franchise opportunities are out there and how to select the best one. Of course, that’s when I tend to say, “Well, drop by my office, and let’s talk.” OK, actually, now I’m more likely to say, “You can come by my office, and we’ll sit six feet apart while wearing masks, or maybe hazmat suits.” Yes, these are surreal times.
And when I’m with prospective franchisees, sure, I tend to sing my own franchise’s praises and suggest my competitors are nice to work with as long as you don’t mind their questionable body odor, because I’m only human. But, seriously, there are many other good property management franchises, aside from my brand.
Really, it isn’t hard to find excellent property management franchise opportunities — it’s how to select the right one that’s the tricky part. And that’s where I can probably help you. If you’re wondering how to select a property management franchise that’s right for you, you’ll want to examine several areas before signing on a dotted line and becoming a franchise owner.
What The Franchise Covers
That is, who are its clients? A lot of property management franchises will help you manage pretty much any property that can be rented. Examples include single-family homes, duplexes, apartment complexes, homes in homeowner associations, vacation rentals and commercial properties. That may thrill you — or you might feel like you’ll be spreading yourself too thin.
That said, you probably don’t want to work with a franchise that specializes in only one type of property. It may work out well for you to specialize, but you may feel that you need different types of properties to manage so you don’t feel as though you’re limiting your revenue.
There’s no right or wrong answer as to what type of franchise you want to work with — one that does everything, or one thing very well, or several things very well — but it’s something you’ll want to mull over before getting too entrenched with a franchise.
What The Franchise Offers In Training
This is crucial for anybody looking to buy any franchise, whether in the property management field or not. Is there training? Probably — I can’t imagine that any franchise in the world doesn’t offer some training, but does it appear to be good training? Are you going to go to a training facility? Or is the training more along the lines of being handed a manual and best wishes? Is there ongoing training? Do you have a couple of days at a training facility, and then you’ll never see the franchisor again? Or will you be able to access webinars, participate in online seminars, return to the facility periodically or whatever you feel is reasonable?
After all, you’re buying a business model, or if you prefer, a business system — you need to know how the business model and system works to make it run successfully.
Of course, finding out what the training is like before you buy the franchise might seem challenging, but it really isn’t. A lot of franchises offer “Discovery Days” when you can go to the headquarters and meet the people in charge (and definitely do that if you’re serious about buying a franchise). You also should consider contacting franchise owners who have already invested in the brand you’re looking at and ask if they can tell you about the training and anything else you’d like to know about being a franchise owner with this particular brand.
Understand The Business Model
So the property management franchise that you’re considering buying will help you manage other people’s properties. What does that mean? Will it help you find and screen tenants when there are vacancies? Will it help you communicate better with those tenants? What about collecting rent, doing regular inspections, solving maintenance issues and offering the type of thorough accounting processes that you’re going to need to be successful? Does it have procedures to help you evict a tenant in a worst-case scenario?
You really want to know that the property management franchise you’re buying is going to help you do your job in the best and most efficient way possible.
Figure Out The Financing
This, too, is important. Few franchises are what you would call cheap, though property management franchises are generally far more affordable than owning, say, a fast-food outlet. In that scenario, you not only have to think about construction or leasing costs; you also have to consider inventory and meeting an extensive payroll, and you will generally need hundreds of thousands of dollars as an investment.
Nevertheless, you’ll still have to look into whether the franchise offers customized financing solutions or whether you’ll be looking to get a commercial loan with a bank, a Small Business Administration loan or loans with alternative lenders.
You’ll want to do this relatively early in the process. There’s no sense in getting yourself all excited about your new career only to realize that you can’t get a loan at this time, or to realize you simply don’t want to make that sort of investment.
Bottom line: Selecting the best property management franchise, or any franchise, for you is like figuring out any career path you want to take. Do your research, and pick the brains of anyone in the franchise world willing to talk to you. Fortunately, at least in my experience, most franchisors — and franchisees — are happy to share whatever knowledge they can. So don’t be afraid to ask. Pick up the phone. Send an email. Reserve a spot in a Discovery Day, which may or may not be virtual these days.
But you want to ask the how, why and what now so you can find the right property management franchise and feel great about your decision. The worst question of all would be to make a rushed decision and later constantly be asking yourself, “Why didn’t I ask more questions?”
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