Huge Mistake #3

Ignoring Whether A Property Management Company Is A Franchise Or Not Here’s how the property management market works in Phoenix. There are a couple of large national franchises...and then local companies. Almost no one pays attention...or is even aware of this fact. Big mistake.

Why? Franchises are built on systems mandated from the main office. Franchisees pay money every month to headquarters for the right to use the franchise name and participate in franchise advertising programs as well as use franchise operations approaches. In Phoenix the main franchise options are Renters Warehouse (headquarters: Minnesota) and Real Property Management (headquarters: Utah). What difference does it make where you do business with a franchise or not? Here are two reasons why it matters:

1. “It’s Company Policy”. Don’t you hate to hear that when you ask for something as a customer and their response is “sorry, can’t, its ‘company policy’? That’s what companies say when they don’t have the ability to make a local decision. Franchisees can’t just decide to run their business ‘any old way they want to’. Their ability to stay in business depends on them adhering to the franchise agreement, and that means that ultimately if you work with a franchise, your Phoenix property is going to be controlled by a policy decided by a guy at a desk in Utah or Minnesota.

2. Is McDonald’s The Best Food You’ve Ever Had? The franchise concept was pioneered by Ray Kroc with McDonalds’ restaurants.

Ray did not know how to actually make fries, or burgers or shakes. Ray actually sold milkshake makers. But Ray was good at making systems. So Ray systematized McDonald’s and the rest is history. But think about McDonald’s...is it known for diverse and interesting local food offerings? Nope. You get the same food whether you are in Phoenix or Utah or Minnesota...same. The entire concept is built to support ‘sameness’.

That’s one of the points of a franchise concept: its the same wherever you go. No local innovation. No cutting edge new ideas. Safe, boring, 1 year behind the times. The same with franchises. They can’t allow local franchisees to experiment or innovate...it will destroy the systems of the franchise. So even if there is a better way to market your home in Phoenix, don’t expect a franchise operation to be the first to think of it. They can’t, it puts their franchise agreement in jeopardy. They have to wait for the folks in Utah and Minnesota to ‘approve’ of their idea...which takes weeks, months, or never.

How To Avoid This Mistake

1. Ask if the company is a franchise or not.

2. Consider a locally owned and managed company. Then you know they can make decisions about your home on the spot, in Phoenix. No need to wait for ‘corporate approval’ on an exception about how to treat you or your property.