American cowboy Will Rogers uttered the famous quote: ‘It takes a lifetime to build a good reputation, but you can lose it in a minute.’ In Management Rights it’s not just your reputation that must be built, but that of the complex as well – this can be particularly problematic when a complex is purchased from a less-than-perfect, former manager.
Many onsite managers to-be will seek out businesses with a very small internal letting pool and a large number of outside agents. This situation is often symptomatic of an incompetent manager who has lost the trust of investors and is selling an under performing business. If it can be purchased at the right price it represents a great investment opportunity for a skilled manager who can turn it around with a bit of grit and hard work, but it’s not without its caveats. In the ‘information age’ disgruntled owners and tenants rarely go quietly and the stigma of a poor online reputation can haunt a business for years to come if it isn’t carefully addressed.
I recently had a manager call me after they took a peak at what people had to say about their newly purchased complex… There, in black and white, were accusations of extortion, theft, adverse QCAT verdicts and downright incompetence, laid bare for all to see.
It’s terrible stuff to read and really unfair when the new managers had absolutely nothing to do with the incidents described. They were finding these reviews were not only discouraging tenants from considering their complex, but worse still, were worrying investors considering using them for management.
It pays to do some online research as part of your negotiating process while purchasing a Management Rights. Search for the complex name, search for the business name, search for the individual staff working at the complex and pay particular attention to Google, True Local and (if it’s holiday accommodation) Trip Advisor. This will help you identify any potential skeletons in the business and can be a powerful bargaining tool during the sales process.
Most review sites will flatly refuse to remove negative reviews regardless of the complex being under New Management. All hope is not lost, however, as reviews will display in chronological order so you can replace the negative with positives if you put in a little effort. Call on your investors and tenants to lend a hand with positive feedback. Your business’ reputation can be improved quickly if you get all your contacts on board to help. If someone has posted a negative review about your complex onto the internet before it was under your management, you should publicly respond, clarify that the complex is under new management and apologise for whatever infractions are alleged against the FORMER management.
The bottom line is: Knowledge is power; so always arm yourself with a solid understanding of a Management Rights’ reputation before you sign on the dotted line. But don’t be disheartened if your newly acquired complex has some bad press. Work with your tenants and investors, build their trust, gain their support and encourage them to come to your defence with kind words and positive reviews. It may take a lifetime to build a reputation, but you can rebuild one in a few weeks with a little help from your friends.