How to collect rent digitally in the midst of social distancing
Just like us here at Zego, we know you are trying to navigate this stressful pandemic crisis as best you can. As a property technology company, we can’t offer any advice on how to pacify toilet paper panic, or tell you what ideally-lengthed tune to hum as you wash your hands. We’ll leave all official guidance up to the CDC, and your local and state health departments. However, we can advise you on how to keep your business running digitally, while limiting, or completely eliminating face-to-face resident interactions.
The first of the month is rapidly approaching. Are you going to accept checks, money orders, and cash that have travelled via the hands of residents, convenience store clerks, bankers, and more? If there was ever a time to make digital payments the new standard for rent, it’s now.
John Maihofer, COO of Coast Property Management, decided to stop accepting paper-based payments altogether back in January. “We’ve made a business decision that, starting in 2020, for all of our market rate properties, we’re only going to allow them to make a payment electronically.” Even before the spread of COVID-19, John said that the acceptance of cash and money orders “from a risk mitigation standpoint isn’t good for us.” His timing could not have been better. But it’s not too late to close up shop on paper payments if you haven’t already.
The first step in achieving 100% digital payment adoption across your resident base is a focus on change management & training for your on-site staff. Just because your onsite managers know how to register a resident within your payment portal, doesn’t mean they will register every resident that walks through the leasing office door. You need to get your onsite associates on-board, or even better, fired up about the initiative. In this article we’ll outline the most effective ways to encourage your team to champion digital payment adoption by setting and tracking key metrics, offering critical training and encouraging healthy competition.
Step 1. Eat, sleep, and breathe the value of digital payments
Educate managers and on-site associates not only on the functionality of your digital payment system, but more importantly, on the value of it. These are your folks on the front lines, interacting with your residents on a daily basis. Here’s how to turn those physical transactions virtual:
Decide on a company-wide digital payment adoption percentage goal. Feel free to use our metrics below for reference:
Keep on Track with KPIs
Stay on target with the help of portfolio-wide Key Performance Indicators (KPIs). Your KPIs should be measurable values that demonstrate the effectiveness of your team’s efforts. Once you’ve established KPIs, align your entire staff on the gravity of these targets. Communicate what’s at stake – the trajectory of your business as well as your associates’ professional growth. Track your progress with the help of your payments provider, and review your KPI’s on a weekly or monthly basis.
Sample KPIs to track:
- Boost digital payment adoption from 20% to 80% by the end of the year
- Increase portfolio-wide adoption by X%
- Increase individual property adoption by X%
- Get X amount of AutoPay sign-ups
Be Transparent with Your Team
Set monthly or quarterly benchmarks for your portfolio and celebrate company-wide achievements by catering pizza or ice cream to each office. Build digital payment adoption metrics into your company’s rally cry. If no one is driving the train, the whole operation will derail. A firm commitment to these metrics will give them weight, which your team will respect.
Drive Home the Value
Over-articulate the value of digital payments during your new hire training in addition to the functionality of the program itself. When your team understands how digital payments can improve or alleviate time-sucking, monotonous tasks and increase productivity, they’ll naturally work harder to ditch paper payments.
Own the Initiative
Don’t be afraid of your team’s reaction to your decision to go paperless. Tina West, COO of Capstone, said her on-site team was pretty receptive to the idea, “I think there’s some fear with learning new technology, but for the most part, you don’t get pushback or resistance from managers when it comes to automating the processes and reducing the time with paper.”
Benefits for on-site associates
We’ve jotted down some talking points you can relay to your team to really drive home the value, and get them on board:
Dear On-site Manager,
As we highly encourage you to stay healthy, wash your hands, and swap handshakes for elbow bumps, we also encourage you to avoid collecting potentially contaminated paper payments. Please collect all resident payments digitally moving forward. In addition to hygiene, you’ll also benefit from digital rent collection in the following ways:
Digital payments will streamline and automate many of your accounting tasks such as reconciliation, managing deposits, month end close, etc.
Assessing and collecting late fees digitally is much easier than the awkward and gruelling process of hunting down and manually collecting additional late payments from delinquent residents.
Credit reporting will boost your renewals, which will decrease vacancies, making you look like a rockstar on-site manager.
Taking payments digitally eliminates conflicts with residents since the digital record provides an indisputable proof point on when the payment was made, if a fee is owned, etc
Most importantly, no more paper-based payments means
No more trips to the bank
No more manual payment data entry
No more in-house cash or money order thefts
No more risky large-sum cash deposits to the bank
Emphasize that eliminating mundane manual processes from their workload will free them up to focus on higher value activities (e.g. leasing, engaging with residents, etc).
“We want them out there doing what they do best. They are people-oriented, great at getting leases. Then, we shove them in a room, shut the door and tell them to count checks.” – Michael Wise, RAM Partners LLC
Set Them Up For Success
Provide each community with the reporting and insight tools they need to drive results. Use BI Tools such as the Zego Insights Dashboard, and daily batch deposit report email notifications.
Greystar provides team members with ongoing training and a variety of resources to help support the adoption of paperless systems. “We’ve implemented a monthly promotional campaign with tools, marketing campaigns and resident-facing collateral that can be used to promote all the benefits of paperless activities to applicants and residents.”
Step 2: Run Contests
Encourage a little healthy competition between communities and co-workers – results guaranteed. Ask your payment provider for your digital payment adoption report broken down by property. Share this report across your portfolio so on-site managers can compare how their community’s digital payment utilization rate stacks up against other properties.
One of our top clients has successfully increased their digital payment adoption month-over-month, year-over-year for three consecutive years. What’s their secret? Every month Zego provides them with a comprehensive utilization report that the owner/operator forwards to all 400 properties within their portfolio.
While a digital payment adoption rate of 30% is considered decent, this company currently boasts a rate of over 55% across their entire portfolio – proving you can really push the needle if you champion it as part of your company culture.
During monthly meetings or your company-wide newsletter, recognize and celebrate the site managers whose rates are rising, and call out properties that are falling behind. This tactic stemmed directly from a highly-regarded management company with lofty utilization rates. So while it may seem a little cruel to draw attention to the “losers,” we guarantee it will light a fire under your lackadaisical associates to step up their game.
“We focus on rewarding community teams and regional property managers whose portfolios have had the highest level of participation with their residents,” – Puryear Helling, Greystar
Follow the steps below to run your own successful digital payment contest.
Step 3. Train with Purpose
Provide continuous product training for your staff, especially if you experience high turnover (not uncommon in our industry). Average turnover for multifamily community staff ranges from 21-54%. Use consistent educational refreshers to combat knowledge gaps and poor customer service within your team.
Receive the information
Tap into your payment provider’s wealth of resources to gather all of your initial training webinars, videos, manuals, and FAQs.
Host the information
Pull all pertinent written, recorded, SOPs, FAQs, and documentation together to create a well-organized, easy-to-access training database for your staff. Your database should easily guide managers through your payments solution at the program level.
Share the information
We suggest an in-depth training during your new-hire/on-boarding program, followed by refresher trainings for the entire team every 2-3 months. Require new associates to attend training webinars hosted by your payments provider.
Curious to know how well your team currently understands your digital payment system? Copy and customize the pop-quiz below to gauge their knowledge.
On-site staff change management & training is only the first step. Our recently published eBook, The Property Manager’s Guide to 100% Digital Payment Adoption, takes you through the value of digital payments and provides the tools and tactics to achieve 100% adoption across your portfolio. This comprehensive program takes a deep dive into the next steps following on-site staff change management & training. Those steps include:
With samples and templates we’ll show you what information you should provide new residents upfront, and set clear expectations around when and how payments should be made.
Alignment of Resident Incentives
Think about what your residents want, and use our checklist to create a win-win payment structure that benefits both you and your renters.
Multiple Payment Options
We’ll review the different payment types you should be offering, including a cash payment alternative. The more digital options you provide, the less cash, paper checks, and money orders you’ll receive.
Resident Engagement and Communication
Your residents have been conditioned to lose patience for clunky, slow, or outdated software. Here’s how to ensure your community engagement technology is up to date.
Not sure if you should take your digital payments initiative to the next level? Take our “Health Check” quiz below to find out how your current process stacks up against our industry’s best practice methodology.
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