Have you ever wondered how profitable your HOA resale department truly is?
Many management companies neglect to measure the financial health of this crucial department. This lack of awareness can lead to missed opportunities and lost profits.
But what if I told you there's a way to unlock the hidden profit potential in your resale department?
In this article, we'll explore powerful financial metrics used by GetDocsNow to review and maximize the success of our clients' resale document departments. We'll also share some eye-opening data that will challenge your assumptions about how to measure profitability.
Are You Financially Illiterate When It Comes to Resale Documents?
Think about it: Isn't it essential to measure the success of your second-largest income source?
Unfortunately, most HOA management companies are flying blind in this critical area. They lack the financial literacy to make data-driven decisions.
But you don't have to be one of them. Keep reading to discover how to gain a crystal-clear understanding of your resale department's performance.
Key Performance Indicators (KPIs) for Resale Departments
GetDocsNow utilizes a combination of KPIs to comprehensively understand our client's Resale document's performance. Here are some key metrics to consider:
Total Revenue: This is a good starting point, but it's a blunt instrument. Market fluctuations and changes in door count can significantly skew this metric.
Average Revenue per Door Under Management: This provides a more nuanced view, but it's still susceptible to market swings.
Average Revenue per Turnover: This is the gold standard for measuring resale department efficiency. It isolates the profitability of each transaction, giving you the clearest picture of your department's health.
Real Numbers: Unveiling the Power of Per-Turnover Revenue Measurement
We analyzed data from a client who switched from GetDocsNow to a competitor promising a 30% revenue increase "without price hikes." (Unfortunately, they lied and increased prices)
Here's what we found:
Revenue per Turnover with GetDocsNow: $308
Revenue per Turnover with Competitor: $333 (after a price increase)
Potential Revenue per Turnover with GetDocsNow (assuming the same price increase): $447
While the competitor delivered a slight bump in "Total Revenue", it came at the cost of higher prices. It was only by measuring the "Revenue per Turnover", we were able to see: by staying with GetDocsNow and implementing the same price increase, the client could have achieved a significantly higher profit margin. Instead, they lost $107 for each property sale, costing them over $40,000 per year.
The Bottom Line: Don't Be Blinded by Illusory Gains or Returns
Focusing solely on total revenue can be misleading. True profitability lies in maximizing revenue for each home that sells in one of your communities.
Beyond the Basics: Additional Considerations
Once you have a grasp of the core KPIs, consider these additional factors that effect your profit:
Employee Expenses: Factor in labor costs associated with processing resale documents.
Operational Costs: Account for expenses like credit card fees, printing, and postage.
Opportunity Cost: Consider the time and resources spent on manual processing, hindering growth potential.
Free Resources to Help You Take Control
We understand that implementing these metrics can seem daunting. That's why we're here to help! To access these resources no strings attached reach out to me and I'll be happy to help!
Free Consultation: We'll analyze your current statements and help you identify your turnover rate.
Free Excel Formulas: Get the tools you need to easily calculate your key resale department metrics.
Consider GetDocsNow Your Resale Department Resource Partner
If you’re interested in discussing this further or learning more about how we at GetDocsNow measure what matters I can be reached at bgreene@getdocsnow.com or to schedule a conversation click here.
Together, let's unlock the hidden profits in your HOA resale department!
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