Disclaimer: This Article Was Originally posted on Tabbli’s Blog. Read Full Article at https://tabbli.com/the-hell-of-rental-property-inventory/
You do not just know, but you live with these challenges
- Your tenants are not happy with your services;
- Some of them ready to leave negative feedback on Facebook or Twitter to hurt your brand reputation;
- Your inventory manager not sure if some item exists on the Unit or not. The same in the warehouse.
- The update of each Unit for inventory and furniture requires multiple deliveries;
- The Unit Renovation process takes longer than estimated;
- You can’t handle more Units because your employees are overloaded;
- You can’t handle more Units because your employees are overloaded;
- Your departments are not synced between each other: sales, operational, logistics, marketing, financing, customer care;
- You have a few non-integrated software tools and copy/paste data manually;
- You overloaded with operational workflows and no time for strategical steps;
This article is relevant for you if:
- You are a real estate Agency or Landlord with several properties;
- Some of your processes have a mess, not fresh, not reliable;
- You and your employees are completely overworked and unsettled with it;
- You are working together for your software instead of it working for you;
- You want to scale up but stuck with routine workflows;
- You haven’t a clear business picture and dynamics;
- Existing ERP systems are too expensive and not adjusted specially for your business
We take a look at the more common mistakes that companies make, and give you the definite inventory management problems list to find the best possible way to solve them.
1. No inventory tracking
It is quite astoundingly, but the statistics fact is that 43% of small businesses do not track their inventory or use a manual process.
I’m not sure how to be convinced in the following:
- If something not stolen or damaged;
- If it requires repairing or replacement or not;
- If it already replaced or not.
- When was it repaired and by whom?
So easy to count the significance of this problem in money just starting to make an inventory regularly.
2. Manual accounting by pen and note
Manual inventory could be ok when you managing only one object with a very short items list. But it looks like some area out of the real estate. I’ve never seen the apartment or even small rooms with 10 items of furniture and no more.
3. The inventory or furniture list is not fresh
It should be quite struggling to understand the real situation with every rental unit if you manage it together with some other team members. I don’t say now about your brain memory accounting system :). Or about pen and paper. But even if you send your teammate the excel file to handle it, then how to merge it back with your local file?
Google spreadsheets could be an option for some first time. Because it works online and saved in the cloud. But it is not a much better solution. Because you never know who changed what and when.
Since your spreadsheet becomes bigger and bigger you should be waiting more and more looking for what you need there.
4. Mismatch with other related workflows
Let’s look, how many different workflows could be related to the inventory process:
Suppliers requests for purchasing
After the first general unit overview, you prepare the full request list to change or set up. Then you have to separate the whole request list by different suppliers. As an example, furniture for Ikea, electronics for Mediamarkt, etc.
The request list for each supplier should contain the proper product name, article, price, and quantity. So it should be existing on your catalog at least.
And you don’t send such a small request like one lamp only. You have to collect it or another way Inventory Forecasting helps you.
But before purchasing new items, you should be convinced if it does not exist in your warehouse. So, check it in the Warehousing system first.
Delivery of the Inventory / Furniture
Managing the delivery from your warehouse, and from external suppliers could be stretched in time. Some of the suppliers provide the delivery to the unit directly or you should get it yourself. It requires extra forces to predict the date and time.
Assemblage and placement
When the delivery of all things has been done it requires to set up and check if everything working fine. When you use some agency for this workflow you have to communicate them and arrange the date and time to provide them access.
Updating the Inventory / Furniture list
After the installation or repairing it would be nice to reflect it in the inventory list to keep information fresh.
The best way to provide property inventory regularly is cleaning. But it means that a responsible cleaner needs to have a fresh checklist for it. And if something damaged or not exists, then new process should be launched. The communicating with a tenant and regulation how it should be updated and who will do it.
Check-in / Check-out
The normal process on the move-in date is creating an inventory report and having this signed by all parties (landlord and tenants). As every deposit taken by a landlord must be registered with an approved scheme, giving the tenants the right to dispute any deductions, a landlord must protect their asset by creating a proof of the initial and end condition of the property.
When you install the wash-machine in the unit, it would be nice to reflect it for all the ads channels you use. Or vice versa there is no need to mislead your future tenants if it is absent.
The helpdesk department very often needs to see what is exists in the room when they get a new complain ticket.
5. A mismatch between software tools
Some parts of real estate agency workflows listed above or others you can have already covered by existing software tools.
- CRM — convenient to guide leads through the funnel and close deals.
- Warehousing — stock management and movement
- Property management — check-in /check-out functions, caretaking, cleaning, safety in the rented property
- Advertising — publishing of units, reflecting the free/busy days
- Financing — invoicing, billing, managing deposits
And the most often situation we’ve met is the lack of integration between all of the listed tools.
- CRM usually contains the contact information of tenants and landlords. But property management and financing need it also.
- The Warehousing system should contain unit information, but property management and advertising need it as well.
- The warehousing system and property management both need the whole catalog of all possible items and inventory/furniture lists.
The worst case is when you make it as a copy-paste approach. I’m sure in a couple of months it will be impossible to sort out something in such a mess.
But import/export via csv-excel files is not much better. Very easy to generate duplicates in all systems. And if you are making it regularly weekly or even daily — you are not sure if something has been changed in other systems since the last update.
So what happens anymore!!! You’ve purchased the software tools to work for you, but you are busy to be working for it. Incredible!
6. No Inventory Forecasting
Some of the most complicated workflows related to inventory management are delivering items from many suppliers, installation, repairing, placement and arrangement all of this in time between all participants.
The easiest way to avoid such a mess is having everything in their own warehouse. But how do you strike a balance between optimizing stock levels and managing cash flow?
Inventory forecasting can be a powerful tool to help you do just that.
It is the process of calculating the inventory needed to fulfill future requests based on how much items you predict you will use over a specific period of time. These estimates take historic data, planned promotions, and external forces into account to be as accurate as possible.
The bottom line.
It is very important to be able to coordinate all team members and provide them fresh and reliable data
Connecting different software tools let you avoiding the data duplication or belate data.
Automation and digitization give you an understanding of the overall picture of the business.
Let us know which issues still you have in your logistics or warehousing workflow. And which software solutions do you use or consider to use?