I think it goes without saying that the economy is bad. And, in a bad economy businesses from every discipline across the world face the prospects of truing up and or slashing expenses. The multifamily space is no different. Payroll being the single biggest expense in nearly any budget is likely the first line item to get scrubbed. I think it important to think about how that line gets evaluated. In other words, how do you go about selecting the team members that get laid off?
It’s a new day and companies are contending with a rapidly changing climate. The speed of that change demands minds that are agile and adaptable. It requires talent.
What criteria are you using to make decisions about laying off team members? Is talent one of them or is it just the last one hire is the first one to go?
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I don’t think that trimming down the team is really the best option. After all, an understaffed property is going to lose occupancy and once we lose rent from a budget we can’t recover it.
It seems a much better option is to find a way to devote resources to retention and look at some ancillary income options such as partnering with a local dry cleaners to offer community service with a 5% return rate or using your cabana walls to display local artist’s work on a 30 day rotating basis and keeping 20% of the profits from art sold. There are a hundred other ideas out there, too.
There are better options than firing someone. Of course, if you have someone on your team that you’ve been looking for an excuse to get off your payroll… well this might be a good time for that.
Most people in a recession forget that there is more than one way to fix a budget crunch. It’s not just about spending less; it’s about bringing in more. And that’s hard to do with an understaffed property.