Source: Southern Metropolitan Daily, January 6, 2012; Author: Chen Zhiping
Summary: Various signs indicate that the real estate market is no longer deteriorating locally but is rapidly declining overall. Moreover, its downturn has affected other industries, including property management.
In the past, many developers' property management subsidiaries invested heavily in both hardware and software to support housing sales. Since these investments were relatively small compared to the total sales revenue of the properties, they were mostly subsidized by the developers. Property management companies did not need to directly face the survival pressure brought by management costs. This situation led them to pursue high standards and quality without delving deeply into the control of operating costs for property management. However, as the market environment changes, when developers stop subsidizing, property management enterprises fall into a loss-making predicament.
In fact, property management, as an independent industry, has its own commercial laws and must possess the ability to resist market risks. "Low-cost operation" should become a long-term research topic for property management enterprises. So-called "low-cost operation" does not simply mean reducing staff or budgets but refers to property management enterprises placing more emphasis on refined management during the process of management, thereby fully demonstrating professional value.
Firstly, it's important to clarify the principle of "living within one’s means." For different levels and categories of properties, different service standards should be implemented rather than continuing the old method of setting posts based on hardware indicators like neighborhood entrances and exits, building numbers, etc., and equipping materials accordingly. For example: two similar residential areas, one with a management fee of 1.8 yuan per square meter and another at 1.2 yuan per square meter. Based on the principle of "living within one’s means," the staffing, organizational structure, and service standards of the two neighborhoods should be different. In terms of personnel allocation, the latter cannot have all types of positions like the former but should reasonably allocate resources according to actual conditions through integrating some positions or adjusting shifts. The service standards should also differ. For instance, the handrails in the corridors of the former can be cleaned every six hours, while those of the latter might be cleaned every twelve hours. Of course, this does not imply any difference in service quality between the two neighborhoods because, whether cleaned every six or twelve hours, the cleaning standard and the required quality are the same. The difference in charging standards determines the frequency of services. This is similar to how the price of a cup of coffee in a star-rated hotel differs from that in McDonald's. The amount we pay determines the product differences we enjoy, but essentially, they are all qualified coffee that satisfies needs.
Secondly, there should be more focus on "refined management." After property management companies collect management fees from homeowners, how to reasonably allocate and use them is a very specialized topic. For example, in some older neighborhoods, property management companies may repaint the curbs of pedestrian paths with yellow and black paint; when planning parking spaces, they may paint all four sides of each parking space with white paint. Homeowners often think that property management companies doing this are being responsible, but never consider whether such expenditures are reasonable. From the perspective of low-cost operation, when planning parking spaces, painting only the four corners with white paint and drawing arrows indicating the direction of parking can achieve the same result while saving on paint and labor costs. Including parking lot lighting and public lighting within the community, through the rational setup of switch control systems, energy consumption can also be effectively saved. Professional property management companies will provide professional advice to developers during the planning and design phase of properties, helping to save construction costs and thus reduce subsequent maintenance costs. For example, in high-rise buildings, setting up a mop-washing pool in the corner of every five floors facilitates cleaners washing mops, improves work efficiency, avoids repeated elevator use by cleaners washing mops on the first floor, which increases elevator energy consumption, and reduces contact with homeowners. In short, different management methods can result in completely different costs. Truly professional property management companies should know how to spend the least amount of money to achieve the best management results.
Thirdly, reduce human factor influence and shift towards technology-intensive operations. In the past, people generally believed that the property management industry belonged to the labor-intensive industry, and its value was traditionally the "four guarantees" (security, cleanliness, landscaping, and maintenance). When developers sold houses, to reflect the quality of the development, they required security and customer service personnel to be good-looking men and women. These factors objectively caused the industry to be continuously influenced by "human" factors, leading to discussions about issues such as "difficulty in recruitment, high turnover, low employee quality, and talent shortages."
From the experience of some cities abroad, whether in urban management or community management, service personnel are often valued more for their experience, background, and maturity. On one hand, in those regions where labor costs are high, this naturally leads to older service personnel; on the other hand, individuals with certain social experiences and who are older tend to communicate better with customers and can appropriately resolve problems.
Currently, China's property management industry also faces rising labor costs and difficulties in managing the "post-80s and post-90s" generations. Therefore, it can learn from the successful experiences of other cities by emphasizing the selection of experience and background during recruitment and lowering rigid requirements for age and appearance. While improving service efficiency, it reduces the impact of "human" factors on service quality and cost. Meanwhile, the property management industry also needs to strengthen the development and application of new technologies to save costs and promote the transformation of the industry from labor-intensive to technology-intensive.
Chen Zhiping, Executive Director of Shenzhen Zhiping Property Development Co., Ltd.