Outsourcing is becoming an increasingly popular strategy for multifamily owners and operators looking to streamline operations, reduce costs and focus on their core competencies. Companies are certainly not alone, however, when feeling hesitant to turn over the reins.

This trepidation is understandable. After all, outsourcing means sacrificing some control, and there are concerns surrounding data security, service quality and more. Dissatisfied residents also have a tendency to put their issues with a third-party service into reviews, making reputation management more of a challenge.

Fortunately, these fears can be easily overcome by thoroughly examining the areas of a community that will most benefit from outsourcing, doing research before implementation and executing diligent follow-up to ensure outsourcing is meeting business objectives.

The Benefits of Outsourcing

There are a multitude of outsourcing advantages for communities, especially when it comes to cost savings. Outsourcing can reduce overhead costs associated with tasks traditionally handled by onsite teams. This is particularly noticeable in the area of package management.

With the unrelenting rise of online shopping, communities are dealing with more deliveries than ever and spending more time logging, storing and retrieving packages for residents. Experienced providers have access to resources and technologies that provide greater efficiency. Turning services over to them frees up teams to concentrate on the resident experience, lead nurturing and other revenue-generating tasks.

Outsourcing also allows operators to scale operations up or down in response to changing resident demands and needs, freeing teams from costly adjustments in staffing and infrastructure.

Steps to Overcome Outsourcing Fears

Assessing business needs and performing due diligence on potential third-party providers helps to alleviate any fears about outsourcing.

1. Identify Areas for Outsourcing: The first step is to pinpoint the areas of operations that are best suited for outsourcing, whether its package management, rent collection, reputation management and more. Many mundane and time-consuming tasks are ripe for turning over to third-party providers.
2. Research and Select the Right Provider: This step is crucial to the success of any outsourcing initiative. Take the time to thoroughly research and vet potential vendors to ensure they align with business needs, values and the desired level of service. Consider factors such as industry experience and expertise, track record, technological capabilities and scalable infrastructure.
3. Develop Solid Service-Level Agreements (SLAs): Once a provider is selected, it's essential to develop a comprehensive SLA that clearly outlines the scope of work, performance expectations and KPIs. A well-crafted SLA can help ensure that both parties have a shared understanding of needs and responsibilities.
4. Address Data Security and Privacy Concerns: One of the primary concerns that multifamily businesses often have when outsourcing is the security and privacy of their data, as well as that of residents. Breaches can be costly and recovery can be time-consuming. It's essential to thoroughly vet an outsourcing provider's data security protocols and ensure they align with company standards and any applicable regulatory requirements. This includes data encryption, secure data storage, regular audits and adequate incident response.
5. Establish Clear Communication Channels and Regular Check-ins: Effective communication is crucial to the success of any outsourcing partnership. Establish clear communication channels and regular check-in meetings to ensure that both internal teams and the outsourcing provider are aligned on status and performance metrics.
6. Risk Mitigation and Business Continuity: Even with a well-planned and executed strategy, there is always the potential for unexpected disruptions or challenges. To mitigate these risks and ensure business continuity, it's essential to have a comprehensive contingency plan in place for disasters or other issues. Work through this with vendors directly and have a clear understanding of their policies.

Letting go of control and entrusting critical business functions to an external provider can be a daunting prospect for many multifamily owners and operators. Remember, the key to successful outsourcing lies in thorough planning, clear communication and a commitment to ongoing collaboration and performance monitoring. By embracing outsourcing and leveraging the expertise of specialized providers, teams are better able to focus on core business activities and achieve leasing goals.