The future of the lettings industry will be tech driven says Michael Day, Managing Director of Integra Property Services and Director of lettings platform teclet.
Nothing remarkable in that view but Michael goes on to say that technology, whilst potentially a business driver, will not, in itself, be the answer, and it needs to provide tangible and immediate benefits to both business and end users in terms of measurable value and user experience.
He said: “We have all heard the stories about technology finding solutions for problems that don’t really exist and there are undoubtedly examples of that although they often don’t exist for very long!
Much more crucially, there has been a lot of noise recently around “joining up” the many and various software and other services that permeate the lettings industry, rather than agents and others having to spend time (and therefore cost) in inputting the same data into various systems and platforms and therefore reducing the benefits that can be derived from an integrated approach. This is clearly a desired position but there are many players in the market who see this as a threat to their current operations and, despite making the right noises outwardly, are inwardly studiously avoiding change.
With pressures on income streams and increasing regulation it clearly makes sense for lettings businesses to take a thorough review of their operations and get away from the “we’ve always done it like this” mentality that still exists in many places.
Maximising income, reducing cost and improving service are key to a successful future.”
In looking at these three key areas, Michael makes the following observations.
Many agents already generate income from a range of products and services but due to the lack of automation in their processes, the way in which this is done is often haphazard, not monitored and non-compliant (aspects such as GDPR and Consumer Protection Regulations in regards referral fees and commissions are key points compliance wise).
Following the Tenant Fee Act that came into effect on June 1st many agents will see a reduction in direct fee income of around 15% or more of their annual revenue. This deficit could be wiping out the profits of a business and finding new ways of generating revenue easily, compliantly and cost effectively will be key.
The ability to justify higher fees from landlords will be largely based round what services are being offered, the quality of that service delivery and the ease of the client and customer in accessing and using those services.
The opportunities for delivering improved services and providing a greater range of products from which to generate revenue really hinges on seamless integration with providers in utility switching, referencing, insurance, document signing, merchant service, inventory suppliers etc. Top quality organisations such as Moving Hub, HomeLet, Docusign, Worldpay, No Letting Go, to name just a few, are all integrated into the teclet platform.
People are the highest cost in most businesses and so the question really is – how productive are they? Automating as many tasks as possible enables each individual to add greater value to a business by being able to process more work – win more listings, let more property, manage more tenancies etc. Automation that engages with end users such as landlords, tenants and guarantors effectively extends the opening hours of a business to 24/7. teclet for example find that over 30% of their consumer interactions take place outside “normal” office hours and this is steadily increasing. Staff that were previously spending half their days chasing the return of documents or booking appointments can now spend their time much more productively. Anecdotally the average length of time spent on an outgoing phone call in an agency office is less than one minute - basically just enough time to leave a message and ask someone to call back!
Managing many different supplier accounts can be time consuming. However, if they are all integrated in one place this time can be better spent on business generation or other activities.
The one thing in life that you can’t get back once it’s gone is time. Anything that makes better use of time or effectively “extends” time has to be a good thing. As mentioned above, the teclet platform allows the working day to become 24/7 without the need to employ additional staff or incur additional premises costs.
Like agents, landlords and tenants are busy people and want to interact when convenient to them quickly, securely and efficiently. Whilst personal contact is important, when it comes to transaction processing, more and more people are much less concerned about the “human touch” and, in fact would rather avoid it (providing they feel their interests and transaction are being looked after properly and they are kept informed and updated at all stages). The beauty of a platform like teclet is that you can choose the level of automation or personal involvement and so can better meet the needs of each individual client and customer.
He added: “We live in challenging times and the opportunities for businesses to step back, review their operations and plans has never been more crucial.
As far back as five hundred years ago, Machiavelli said “There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success than the introduction of a new order of things, because the innovator has for enemies all those who have done well under the old conditions and lukewarm defenders in those who may do well under the new.”
Change may seem slightly daunting but standing still is, in reality, going backwards.
Don’t get left behind. Bring a little “joined up” thinking to your business.”
Michael S Day MBA FRICS FNAEA FARLA