Vacation Rental Entrepreneur Series: Part 1
I’ve decided to start this series because:
1.) It’s never been done before…
2.) I want vacation rental owners to do better and make more bookings and…
3.) I want to help property management companies go farther than their current business structure is allowing them!
So, subscribe to our blog to get the latest vacation rental business tips!
A Vacation Rental Is A Small Business
With that said, I firmly believe that in order for owners to do better with their vacation rental bookings, they have to first fully accept that they’re operating a business. This is a tough pill for some owners to swallow. To them, it’s still just their second home. They’re essentially in denial. Trust me, if you ignore this nugget of advice, you do so at your own risk!
Whenever there is money continuously being exchanged for a product or service, there’s a business. The sooner you embrace that your rental is no longer your “second home,” but that it’s a business, the sooner you can treat it like a vacation rental business and reach new levels of success. The problem I hear from owners is that they haven’t had any formal business training. I’m hoping to provide you with a crash course on business basics to keep you focused and profitable!
Did You Know?
Out of every 1,000 new businesses, 40% fail within the first year.
80% would fail within 5 years.
Don’t throw a party just yet if you’ve been lucky enough to have made it to 5 years.
80% of those businesses fail before they make it to 10 years.
By being dedicated to following a number of key business rules, this year we are celebrating our 10 year anniversary. We’re still going strong! I want to help you reach the 10 year mark and beyond, too.
I’ve seen too many owners lose their investments and managers close their doors. That is exactly why we’re doing this series… it’s that important!
Vacation Rental Owners & Managers ARE Entrepreneurs
Now that we’ve got that out of the way, you should also become cozy with the idea that you’re an entrepreneur. You see, you became one when you chose to open your small business. Don’t think that being an owner of a cottage makes you an entrepreneur?
“a person who organizes and operates a business or businesses, taking on greater than normal financial risks in order to do so.”
I think when you took out that mortgage or purchased your vacation home, you did exactly that. Am I wrong?
Vacation Rental Business Rule #1
Do you ever feel like you’re running around like a chicken with his head cut off? Many small business owners seem to be.
I know. I used to be one of them.
That is, until I read the book E-Myth, by Michael Gerber. It’s truly a classic and a must-read for anyone considering getting into business of any sort.
I was in the trenches of business digging my way through when, luckily enough, I stumbled across this book. Since then, I’ve read the E-Myth several times. It was a process for me to incorporate much of Michael’s ideas and principles into my business. I was a little stubborn at first. After all, I had “my own way” of doing things and I thought they worked for me.
Eventually, I saw quite a few areas I could make improvements in, so I began to re-train myself. In retrospect, I can clearly see that my business mistakes cost me an exuberant amount of money over time, and I wish I would have made the changes sooner.
Are you costing your business money? Don’t be like me, doing things “my way” because that’s “what works.” Learn from professionals like Michael – professionals who can improve your day-to-day business operations and earn you more time and profit.
What’s the biggest lesson I learned from him?
You can’t work ON your business if you’re too busy working IN your business.
Working “on” your business means that the business is moving ahead; you are constantly working on and improving the business. Working “in” your business means you handle a lot of the day-to-day tasks.
If you’re caught up in all the details of your vacation rental business operations, you can’t get your head out of the work long enough to see the opportunities to improve your business.
Your vacation rental is a business and it has the demands of a business. If you’re a smaller agency or single property owner, it’s often just you… sort of like a one man band. Ever felt that way?
It’s easy to try to take on everything yourself to save money or to avoid the feeling of loss of control because you feel like “no one can do it like me” or because “I can’t afford it.”
With that said, there is a lot an owner can try to do themselves, like property management, marketing, maintenance, website maintenance, guest check in/check outs, bookings, cleaning, taxes, pool cleaning and the list goes on.
What jobs do you handle in your business?
Maybe – just maybe – some of those tasks you’re doing are actually holding your business back, causing you to make less profits while increasing the stress in your life.
For example, let’s say that while you can balance a checkbook, you are new to accounting, yet you have opted to keep the books for your business. It takes you hours to get through the invoices and bills, and the whole idea of taxes just freaks you out! Is it wise for you to continue serving as the bookkeeper/accountant? What would you be able to do if you delegated this task to someone else? Someone more experienced?
As a vacation rental business owner, you should be trying to make everything easier, faster and better. Doing so will increase quality, profits and productivity.
Whenever our company has grown, I had to make a decision, and that decision usually included increased costs – whether the decision was to get our first office (since I was starting out of my home) or to hire my first employee.
The thought process was something like, “Can we afford the cost?” And in many of those cases, the bank account said no, we couldn’t afford the expense. Looking back, it’s more like we couldn’t afford NOT to do it.
Our calculated decisions have always led to an increase in business and income.
In my upcoming newsletter, I’m going to show you several ways that will help you work less “in” your business and more “on” it. This is the perfect way to get your New Year started right!
Sometimes you can do more by doing less. I’ll show you how!
In this series I will diagnose you with a multiple personality disorder and you won’t disagree with me, stay tuned.
Have a tip or example of your own? Post it in the comments section below.
Wow, I love this post! I feel like I definitely have a better understanding of what it means to be an entrepreneur. I never thought about a business owner having to learn how to work “out” of their business, because conventionally, it makes more sense to be completely immersed “in” your business….it is yours, after all!
But this post really hit home with me for some reason. I feel like if I can learn how to apply this concept in all aspects of my life, not just in my career, then I’ll have a lot more success. I need to learn how to delegate tasks when I can and let loose of the reigns a bit when possible. Who would’ve thought I could be more efficient by doing less, haha.
Thanks for the post, Jay! Definitely something to think about here!
I know Megan, this goes against everything we are taught. I always thought we are to do as much as we can in our business, boy was that thinking wrong! Thank you for sharing how this blog has helped you. I hope it has done so for others.
The older I get Megan, the more I delegate out to other “experts”. I also understand more about what “I’m good at” and “what I’m not so good at”. I’ll give the part of my business that “I’m not so good at” to someone who is much better at the tasks than I am.
Jay -Great article, glad that you’re writing about that the Vacation Rental as a real business. Most people who invest in a vacation rental don’t have a clue about the amount of work and marketing effort it takes to get a guest through your front door. Kudos to your new series!!
Thank you Maria! I wasn’t sure how it would be received. I know many owners reject this idea of “business”. They don’t see themselves that way and I feel that some of them think they don’t want to be in “business” they want to ‘rent their second home” (its sounds more fun) and to be able to do what they want to do without any guidelines, expectations, pressure and the responsibilities that come with owning and running a “real” bonified business.
I find it hard sometimes to pull myself out of the work because theres always something that is needing to be done. This is a huge struggle for me but your blog Jay has reminded me how important it is to stop and think to myself, is this a task I should be doing, does it makes sense or am I costing myself more money by not giving it to someone esle who can do it on time, better and for less. My time as a “business” owner I think is more valuable than I sometimes realize and the cost of me doing things cost me more than I am aware of.
Maria, I couldn’t have said it better myself. I’m learning each day that I have to learn how to turn things over, both in business and everyday tasks. We’ve all got our strengths and weaknesses…recognizing that is so important in being successful!
Thanks for your thoughts, Maria, I appreciate the words of wisdom!
Excellent points, Jay! Utilizing a team is important for sure.
With a team you’ll achieve the dream!
Tyann, glad you liked!
This is so true and afflicting my partner and myself right now. But, finding the right people to take over all the jobs that we do at a price that makes sense does not seem possible. Our business is too small to support a full time Australian worker because of the very high hourly pay rate. So we need to look at using a virtual worker or a helpdesk.
We list and take bookings for holiday homes in the Cairns region. Our big difference from the giants of VR listing is that we are phone available and our knowledge of all our listings is first hand. It is probably the major reason for why customers come to us because they can ask questions about any of the thirty odd properties listed with just the one phone call.
Replacing ourselves by others working IN the business will require us to describe in detailed documentation our procedures and processes. That is no easy task, especially when we are already time short. Some jobs can be automated too – email and contact management for example.
Hi Nick, your comments are going to play into my next posts, so I’l save some of my suggestions for then, but don’t give up on this Nick, because your life and sanity count on you making this switch in your business. Its worth whatever you have to do to make it happen, it might take some time, like it did me, but thats OK! Finding people to help has become easier since people can work remotely and per project like a contractor, so theres no excuse for owners not to get help today. Its harder to find the “right” people though, but they are out there! Keep making efforts toward this Nick and make it a goal for this year, your life, family, business and customers will thank you for it! If it were easy everyone would be succesful in business! Dont take your eyes off the prize “ON” not “IN”.
Thanks for the encouragement Jay.
Hi Jay, very thought provoking, I like it! As someone who is 1 year in to a new business those stats scare me! But having a little “scare” is good, it forces you to focus on what really matters.
Which is? Ensuring you prioritize your list of tasks and accept you can’t do the entire list right away. I see owners constantly saying “I don’t have time to do upload my new professional photos”, or “I can never find the time to update my listing copy”, etc. And I always hear “I don’t have time to do everything”. Well that’s why the “scare” is good – you need to know that trying everything will lead to business failure.
Focus. I write all the tasks down and give them a priority scale. If you have 20 things, your scale is 1-20. If you have 10, the scale is 1-10. Take 10 minutes to do that and then go after them in order of priority. It’s about figuring out what is the most important.
Andy those stats are scary and make us all aware of what the stakes are and how many people lose everyday at this game we play called Business.I believe this series hits at the core of many of the issues owners and managers face and explains why the industry is so fragmented. Andy, thanks for sharing that great task management technique. However if you are working off of your to do list, would that mean you would still be working IN your business?
Ha ha you’re right Jay! But I would say that, for the early start up period, there is no other way – you are required to multi-task. But the same logic applies – prioritizing will help to focus you on the important goals, some of which will be working ON your business, some will be IN your business. Even working ON the business requires a list to ensure the goals are clear, hence the scale technique!
Thanks Andy for clarifying that for everyone following and for adding value!
Another consideration too–It is a small business–back to staying ON it, if you’re listing with the big dogs (VRBO, Flipkey, Airbnb) they create work additionally from the day to day tasks. You always need to keep up with changes they make, many that actually create more work for your listing. that’s why forums such as this help with ideas and info to help streamline a little. They have many glitches too-so you always have to keep checking calendars, emails they send out, proper updates on pricing. If you list and let it go, you see how many mistakes happen. Another reason to work ON your property, not just day to day stuff.
Hi Blamona a big welcome!
So true, it has become such a task to keep up with these listing sites.
Very timely article Jay! I am the ‘chicken with its head cut off’ as I wear ALL the hats in my business. I NEED to hire help!! Theoretically, I know if I out source some of the more mundane jobs (like cleaning, maintenance, getting supplies…) I can free up some of my time and focus on growing my business even more. But it’s hard to let go especially as I come from a family of do-it-yourselfers! I also fear that if I give up some of these jobs my business will suffer or I’ll come across as not authentic. How do you balance that? I look forward to the rest of the series and maybe I should pick up Michael Gerber’s book to learn how!
Hi Amy, I know that feeling of running around crazy all to well but part of the reason thats happening is that you’re fighting against yourself and there’s no way you can win that fight. If you’re like me your probably the biggest problem in your vacation rental business. You have to “fix” you before you can fix your business.That sounds so harsh to say but likley the truth with us “entreprenuers”. I am sharing this information because I’ve had these same problems. Sometimes I have to put myself in check and remind myself what my roles are and that keeps me together. Your fears are common ones Amy, hopefully the series will help you let go. I’ll give you a mix of proven tips that if applied they will make things better. This series will have several layers of entreprenuership training. If I haven’t offended you yet Amy wait til next week where I call “you” crazy. Looking forward to sharing it with you.
Ha ha Jay! You haven’t offended me yet! 😉
Being in business since 1982 and owning my Vacation Rental for the past 15 years. I realized that I can’t run a business alone, you need a team of experts who know more than you do, at skills you don’t have or haven’t acquired as yet. Why take the chance of failing at business when you don’t have to. What Jay is saying is very true. I’ve seen tons of businesses come and go in the Vacation Rental business because of inadequate marketing.
Update: Part 2 of The Entreprenuer series has been posted Check it out! http://villamarketers.com/vr-business/
You must log in to post a comment.