Another type of relationship is with your vendors. Making sure your vendor is top of the line is the first step in your blossoming relationship that cannot be overlooked. In these rapports, mystery loses its allure. According to a Buildings magazine article, Vet Your Vendors: Screening Steps to Ensure Your Vendor Is Top Notch, “more than 80 percent of companies conduct formal background checks on their full-time employees, but less than 20 percent do any type of screening of their vendors, supplies, and contractors.”
It’s imperative today for many property management teams to adapt their approach and processes to meet the demands and expectations of modern tenants and owners in the information age.
This more often than not involves evaluating and implementing new technology solutions to help deliver on those expectations and to help management companies and building owner-managers differentiate their property and building based on the way they operate and utilize technology. This can be a daunting task, but, these 5 questions can help and should be a part of any evaluation process.
1. Can you provide us with the names of three current clients?
All vendors obviously will provide you with a list of satisfied, happy clients. But the question the buyer should ask is, “Are they relevant and comparable companies to us?” By this I mean, are they of a similar size, with use cases and workflows that mirror ours? If not, keep in mind that most good partnerships begin with thorough preparation and attention to detail. Either the salesperson didn’t do his homework, or the company may not have clients that resemble you.
2. How will you ease our transition?
Many commercial real estate firms are transitioning from another property management software system when they partner with Building Engines. We have significant experience in large scale transitions, offer unlimited, no-extra-cost training and service, along with the expertise of dedicated deployment specialists, which puts clients in that situation at ease. If your prospective partner answers questions about the transition with assurances without examples and substance, you may want to probe more deeply.
3. What will this really cost me?
Think of it like getting on a plane. There’s the cost of the ticket, which is easy enough to understand. But then comes the weight-adjusted checked baggage fee, half-inch of legroom charge, assorted overpriced junk food, carry-on baggage fee, ticket-stamping-fee, and looking-into-the-cockpit-as-you-board-the-plane surcharge. Yes, I made that last one up. But did you have to stop and think about it for a second?
My point is, working with a vendor shouldn’t feel like buying from an airline. Ask this question, and if it takes more than sixty seconds to calculate what you’ll be paying for the first year, keep looking. Good partners are transparent about pricing and make it simple to understand.
4. What’s your client retention rate over the past five years?
This speaks for itself. Always ask for the five-year rate, because many of the larger CRE companies now require contracts of 3-5 years, rendering the one year turnover rate less relevant. You are looking for proof of a minimum 90% renewal rate as this a terrific indicator of a company’s commitment to service and long-term partnership with their clients.
5. And, how this next question is answered can tell you a lot…
“Who are your competitors and how are you different from them?” This is a question every sales person gets and should never shy away from. We all operate in businesses with competition and at Building Engines, we respect the intelligence of our prospective clients enough to understand that they typically know who the providers are in the category they are evaluating. The question is an opportunity for a prospective partner to clearly articulate the value they deliver and the differentiating characteristics of their product and company for you. The rest of the sales process is where you’ll have the opportunity to determine whether or not their answer rings true.