Outsourcing: dispelling the myths for lettings agents
Outsourcing in the lettings industry will be on many business owners’ minds as they look for ways to operate more nimbly in the face of recession – so it has never been more important to dispel those commonly-held misconceptions.
The current buoyancy in the lettings market - fuelled by low supply, the drop in stamp duty and pent up demand - has led to a renewed interest in outsourcing, according to The Letting Partnership. One major outsourcing growth area is in client accounting and client money protection (CMP), driven by new regulations.
Chris Mason, Operations Manager, The Letting Partnership, said: “Although the movement of travel was already set, the pandemic has only expedited the upswing in outsourcing within the sector.“
“Since April, we have seen a sharp rise in outsourcing demand, as agents seek to focus their attention ‘on the business’ rather than ‘in the business’ and redeploy their teams to play to individuals’ strengths. While we know that agents appreciate the opportunity to focus their energies on strategic business development, leaving specialists to quietly get the job done, for some there are some deep-seated barriers to making the switch to outsourcing.”
A recent Deloitte study highlighted the top reasons businesses decide to outsource, including: to reduce costs (59 per cent); to focus on core business (57 per cent); to solve capacity issues (47 per cent), suggesting there is much to be gained from outsourcing in this climate.
Here are 4 commonly held myths around outsourcing, dispelled:
- Myth: I will lose control
Remember, you are the decision maker and will always be. You should feel comfortable providing input and influencing an outsourcer’s approach. Any outsourcing company worth your custom should be able to provide virtually seamless transition and no drop in service.
- Myth: I can’t trust an external supplier to do the job as well
Outsourcers are specialists in their field. To gain peace of mind, look for a provider who has industry membership, professional indemnity insurance that is robust enough for the business they undertake – an outsourcing company should be happy to be completely transparent about this. Ensure too, that outsourcers have specialist cover suited to their business.
Your outsourced provider should offer genuine transparency and make information available to you at all times – it’s your information after all! At The Letting Partnership, for example, our agents have 24-hour access to view their Client Account.
Be wary of any Client Accounting Service Providers who refuse to set up individual client accounts – pooled client accounts or the sweeping of your client money elsewhere should ring immediate alarm bells.
- Myth: It will cost too much
Outsourcers should be able to offer significant economies of scale and real expertise.
A useful question to consider is: how much is your time worth as a business owner?
Many agents over-estimate the cost of outsourcing, choosing either to take on the task themselves or delegating it to an administrator who may either be poorly suited to the role or not sufficiently skilled, often leading to frustrations, inefficiencies – and ultimately time.
Redeployed time can earn significantly more money than the cost of the outsourcing.
- Myth: The outsourcer won’t be able to work with my existing systems
While there can be issues with legacy systems and integrating software, you won’t know until you ask! In the field of client accounting, for example, you should expect your outsourcing partner to be able to work with the three major software providers Jupix, Alto and Reapit, as a minimum. There should not be any need to buy into a new piece of software in order to work with your chosen provider.
For more information visit: https://www.thelettingpartnership.co.uk/