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Cost-Benefit Analysis: The Structure of Property Management Fees

The American Association of Apartment Owners lists six mistake property owners make that cost them money.(1) Five of them are directly related to repairs and maintenance, which can be addressed by hiring a property management company. Hiring a management firm to represent your commercial interests can be a time-saving move, and as we all know, time is money. And, when it comes to money, management agencies have a flexible fee schedule to meet their clients’ needs. An owner’s primary goal before signing with someone to manage commercial property is to find out what all those fees actually buy.

The enigmatic “property management” fee

Property managers keep your property leased with paying tenants, and that’s what makes property ownership either profitable or unsustainable. The management fee can be a percentage of monthly gross rent or a flat fee. It pays for the property manager’s time spent showing and advertising units, administering lease agreements, screening applicants and resolving tenant issues. This fee pays for the public face of your property and keeps it full and profitable. It is the bulk of what you will pay a manager.

Administrative management

This duty may require a separate fee that covers administrative work such as managing dispute resolution with tenants, sending out statements and providing reports to the property owner. If this fee is separate from the management fee, it pays for extra time spent on issues specific to your property. It will cover postage for tenant statements and office costs for administrative services as a whole. You could also consider part of this a supply fee, which pays for paper, printer ink, time spent stuffing envelopes, and any other office supply or mundane task associated with property management.

Collection fees

This looks pretty self-explanatory, but it doesn’t just deal with past-due collections. This service encompasses collection of all rents, fees, revenues and delinquencies.

Maintenance fees

These are special costs tailored specifically to your property’s upkeep. While management takes care of the leasing aspect of your bottom line, regular maintenance can greatly reduce the risk of serious investment losses due to deferred maintenance and property damage. Maintenance fees cover interior and exterior repairs, minor improvements and cleaning.

Other unspecified fees

Property management companies all differ in what they include in their basic management fee schedule and what is considered “extra.” Ask for a complete fee schedule before you sign with a management company, and avoid any surprises by asking plenty of questions and getting details in writing.

A Guide on Successful Product Creation and Internet Marketing

Product creation in Internet marketing is getting stiffer and stiffer nowadays owing to tough competition between Internet-based businesses. Putting up a new product requires plenty of brainpower and finances along with an ability to take risk. With that, even if you have the product well-set already, you have to position it strategically in the Internet landscape for others to notice. You should get the interest of Web users and turn them to actual customers. Aside from the usual physical products, many different products that thrive well on Internet marketing include E-books, membership sites, and video lectures.

The long and difficult process of product creation begins with ideas. They are easy to get – compared to the effort that comes with analyzing the market for that idea. Before the idea turns to a product, businesses often spend money, even amounting to millions of dollars, to ensure the success of the new product that emerges from an idea. Businesses undertake many types of market research and surveys before releasing their products to the public. Now, you may think that because your business is small, you can’t afford research or you don’t have to do research; you can and you should. The Internet allows you to disseminate materials needed for your market study to many people at once without your having to spend a cent.

It is a common maxim in business: Look at your destination first before mapping out your journey. So what are the goals you intend to accomplish with your product creation ventures? The everyday travails of your business may make you forget the end in sight. On the other hand, prepare to entertain new developments that come to your mind in your product creation. Your conception of a product may have started this way, but a few tweaks here and there along with some market research results and it ends up another way. Take it as the result of a creative process, not as a failure to reach your goal. After all, your product creation activities are intertwined with a long-term goal that you should strive to sustain at your utmost: profit generation. So if your less profitable initial idea evolves to a more profitable product, be thankful!

With your product made up already, start doing some aggressive Internet marketing. A product purchase typically comes after more than five times a customer is exposed to an informative call-to-buy message. Thus it is important to get the contact details, like the e-mail address, of potential customers who are on the brink of a sale. Use the results of your market research to determine the demographics to which you should concentrate your marketing efforts.

With consistent product creation, you can make an inventory of your products that you can market in due time. Just keep making products – the moment you succeed in making and marketing a product, customers are surely wanting more from you, so give it to them. Keep them on your side through constant product creation.

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Tax Season! Ugh! The Benefits of a Home Based Business at Tax Time

Yes, it’s a royal pain in the butt to have to file our tax returns, but it HAS to be done, so stop whining about it and get going on it! (I have told myself this for the past 28 days, it’s now March 26th. I have 17 MORE days until April 15th to procrastinate with. I really shouldn’t be writing this article. I SHOULD be working on my taxes, UGH!)I know that many people feel the same way that I do when it comes to getting the tax return done. Why does it have to be so complicated? It seems that taxes are just one of those ADULT chores that NEVER goes away…hence the saying “death and taxes.”OK, I’m done whining for now.If you are a home based business owner, make sure that you take advantage of all of the tax deductions that our generous Government makes available to us when it comes to home ownership (something that is becoming more and more obsolete these days!) And what I mean is besides the normal deductions of mortgage interest and property taxes paid…if you are running a home based business, and even if it is just an internet business and it doesn’t take up a lot of space, you can still take the Home Office Deduction.Remember to Take These Home Based Business Deductions: The Home Office Deduction- This deduction can help take the biggest bite out of your tax bill. If you are a small business owner, self-employed and do your work from your home in a space that is consistently and exclusively used for your business, you can take this deduction, even if the space that you use in your house is not a completely separate room. It must be a clearly defined workspace where no personal activities take place.A percentage is allowed for this deduction…
Figure out the approximate percentage of your home used for business. For example, if you have an eight-room house and your office occupies one room, your workspace would be about 12.5 percent. You can also add up the total square footage of your home and the square footage of your workspace to figure out the percentage.
Add together your rent or mortgage interest, utilities, maintenance, real estate taxes and insurance and multiply the total by the percentage you use for your business. (If you own your home, you can also factor in the depreciation on the room or space you work in.) Your final figure is your allowable home office deduction.Business Expenses – Even if you don’t take the home office deduction, there are many other expenses that you can take deductions on to help reduce your tax liability. Keep all of your receipts throughout the year and a running log of all of your daily and weekly expenses to have proof that your deductions are legitimate. Below are some expenses that can be deducted:office supplies
postage and shipping costs
printing expenses
all phone expenses..land & cell
internet service used for your business
memberships in professional organizations
subscriptions to journals and magazines needed in your work
all advertising fees
business insurance
seminars and courses (include travel expense to and from)
services by other professionals (attorney, maybe a good tax accountant?)Big improvements, such as a new computer system or a suite of office furniture, can either be immediately deducted up to $25,000 in the year they are bought or depreciated over several years. (Five years is the typical depreciation period for most equipment.) It’s worth it to deduct large equipment purchases right away if your business is showing a profit.Hope this information has helped you out with your home based business.Good Luck with your taxes…I wish you many Happy Returns!