Managing with Metrics What Numbers Can Tell You

Managing with Metrics – What Numbers Can Tell You About Your Business Eric Wetherington Director/Broker Carolina One Property Management

Are You Measuring Your Business? • Budget • Basic Tracking • Advanced Tracking

“The great majority of people are ‘wandering generalities’ rather than ‘meaningful specifics’. The fact is that you can't hit a target that you can't see. If you don't know where you are going, you will probably end up somewhere else. You have to have goals. ” ― Ziglar

Objectives 1. What Are Metrics? 2. Why Should I Measure Anything in My Business? 3. What Should I Measure in My Business? 4. What Can I Do With Numbers Once I Am Measuring?

What Are Metrics? Standards of measurement by which efficiency, performance and progress can be assessed. Businessdictionary. com

Performance

Progress

Why Measure?

“Measuring business performance will keep you focused on the strengths and weaknesses of your business. When you know where to focus your attention, you can use specific problem solving techniques and decision making tips to help minimize areas of weakness. ” Kris Bovay

What Should I Measure? Actionable Auditable Accessible

The Basics • • • Applications Received Applications Approved Move Ins Move Outs New Managed Units • • • Total Units Occupied Units Occupancy Rate Vacant Units Rent Collected Average Rent

What Can I Do With Basic Numbers?

• Simplify menu • Drop low-selling items • Give more regional control to add menu items

Big City Property Management Rent Collected 2013

The Basics • • • Applications Received Applications Approved Move Ins Move Outs New Managed Units • • • Total Units Occupied Units Occupancy Rate Vacant Units Rent Collected Average Rent

Avg. Monthly Rent $1, 308. 53 Total Monthly Rent $1, 461, 630. 07 Portfolio Name Unit Name 1829 -602 Dogwood Rd 183 Decatur LLC 183 Decatur Drive 186 Smith Street LLC 186 B Smith Street 186 Smith Street LLC 186 A Smith St 186 Smith Street LLC 186 C Smith Street 197 Decatur LLC 197 Decatur Drive 233 Little Oak LLC c/o Michael Oshaughnessy 2393 -2 L Folly Rd 318 Deep River, LLC. 318 Deep River Road 414 Decatur Dr LLC 414 Decatur Dr 6794 Amberlake Dr LLC 6794 Amberlake Dr Showing Rows: 1 -10 of 1117 Edit Del Go to Report •

Advanced Revenue Per Unit Compensation Per Unit FTE’s Per Unit Marketing Expenses Per New Unit • Operating Expenses Per Unit • Profit Per Unit • •

What Can I Do With Advanced Numbers?

Project Big City Property Management has an opportunity to take on a new customer and add 100 units to its portfolio. Should you take on this new customer? Why or Why Not?

Project Average Metrics of Big City Property Management 400 Units Managed • Rent $1, 000 • Revenue per unit $150 • Compensation per unit $75 • Operating Cost per unit $65 • Profit per unit $10 Big Name Investor, Inc • 100 units (avg rent $750) • 25% discount off management fee • Expect weekly calls and daily reports • Maintenance performed by their crew only

Budget Worksheet 01/14 02/14 03/14 04/14 05/14 06/14 07/14 08/14 09/14 10/14 11/14 12/14 TOTAL 192, 710 201, 536 214, 248 219, 358 228, 729 228, 377 235, 973 236, 786 222, 768 219, 268 213, 047 218, 452 34, 316 36, 026 39, 025 40, 023 40, 906 41, 521 42, 389 43, 263 40, 550 39, 654 38, 137 39, 291 158, 394 165, 510 175, 223 179, 335 187, 822 186, 855 193, 584 193, 522 182, 217 179, 613 174, 911 179, 161 1170 1170 1170 14, 040 1, 761 1, 761 1, 761 21, 132 2, 931 2, 931 2, 931 35, 172 2, 018 2, 068 2, 118 2, 168 25, 117 Total Compensation 85, 841 87, 485 90, 466 92, 028 93, 963 94, 652 96, 423 97, 237 95, 761 95, 691 95, 278 96, 899 Total Operating 19, 648 21, 665 20, 086 20, 162 22, 725 21, 094 21, 218 20, 703 20, 043 20, 923 21, 066 20, 059 249, 391 110, 438 114, 100 115, 501 117, 189 121, 687 120, 744 122, 690 122, 989 120, 853 121, 713 121, 443 122, 057 1, 431, 403 Preliminary NOI 47, 957 51, 411 59, 722 62, 146 66, 135 66, 111 70, 894 70, 534 61, 365 57, 900 53, 468 57, 104 724, 745 Admin Allocation 9, 862 9, 862 9, 862 118, 345 38, 095 41, 548 49, 860 52, 284 56, 273 56, 249 61, 032 60, 672 51, 503 48, 038 43, 606 47, 242 19. 8% 20. 6% 23. 3% 23. 8% 24. 6% 25. 9% 25. 6% 23. 1% 21. 9% 20. 5% 21. 6% 1255 1117 47 100 45 1269 1129 55 120 52 1285 1144 70 125 53 1302 1171 72 125 54 1318 1186 75 190 40 1331 1198 77 150 31 1340 1220 79 190 52 1356 1234 82 150 47 1371 1248 65 100 48 1386 1247 60 100 40 1398 1258 50 90 41 1411 1270 55 95 37 Gross Real Estate Commission Total Income Commission Paid to Associates Total Commission Expense Company Dollar Office Marketing Subtotal: Office Marketing Company Marketing (Allocated) Subtotal: Company Marketing Total Marketing Information Technology Total Information Technology 475, 103 Compensation Operating Costs Total Selling & Operating Profit / (Loss) Net Earning Total Units Occupied Units Move Ins Applications New Units 787 1535 540

A Wandering Generality or a Meaningful Specific?

As a result of attending this session… What are two things I am going to start doing or stop doing when I get back to the office?

Contact Me Eric Wetherington Carolina One Property Management 4024 Salt Pointe Parkway Charleston, SC 29405 843. 202. 2131 ericw@carolinaone. com