Yep, it’s that time of year again. That time when there aren’t enough hours in the day and crunching numbers never seems to end… It’s Budget Season.
In case you’re feeling a bit overwhelmed, check out our budget checklist below to make sure you’ll be nailing your targets for the year ahead.
- Reviewing at least the last two years’ worth of financials. Before you do anything, pull the property budget files for the previous two years. This will give you the insights you need to decide whether your budget was distributed appropriately and if any budgeted expenses were way over or under. Being able to look back further than just the past year will help you to identify the root cause of any discrepancies and correct it for the year ahead.
- “Eat the Frog.” Have you ever heard this saying? It means tackle the most difficult task first, whether it’s staff reviews, capital expenditure analysis, or vendor contract updates. You’re more likely to complete it before you are drained and distracted from a multitude of smaller tasks. Also, the sense of accomplishment you get from completing it is great motivation to keep going!
- Better manage vendor rate increases. We know one of the biggest budget season headaches is reviewing vendor contracts and negotiating rate increases. For the initial outreach to your vendors, have a template ready to go and email everyone at once using an email marketing tool such as Constant Contact or MailChimp. Don’t waste time calling each vendor individually when it could be better spent on other project. In addition, make sure you have one central repository to track when contracts are expiring, if price escalations are built-in or CPI-based, and whether it’s a building level contract vs. corporate contract. A lot of time is wasted contacting the wrong point person because you weren’t tracking that information.
- Identify your most-in-need projects. Pull up a complete list of all projects and repairs that have been requested for the upcoming year and prioritize your list into needs and wants (focusing first on any safety or liability issues). Make sure you have enough budgeted for “needs” before you even consider the “wants.”
- Three Line Items to consider adding: tenant retention investment, team incentives, and technology purchases. If tenant retention is your goal, then dollars in that category should reflect a real commitment to it! i.e. Plan for an extra tenant appreciation event. When it comes to your staff, incentives promote a positive working environment and encourage growth. And technology purchases are a no-brainer… which brings me to item #6.
- Get the right tools. With so many online tools and software systems available to help run your property, it can become really difficult to manage the data – especially if systems don’t play nice together. Many modern property systems can do most of what you need in a single platform, allowing you to save money by utilizing fewer providers. You can learn about Building Engine’s unified Property Management Platform here.