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Why Choose an Independent Managing Agent?
Why Choose an Independent Managing Agent?
After the Directors of the Residents Management Company (RMC) became increasingly dissatisfied with the poor service levels being provided by their National Managing Agent, In June 2024, we took over management of a development of 36 apartments over 4 blocks at Spath Holme in Didsbury, Manchester.
Dissatisfaction over poor service levels is a common experience for RMC’s. It’s the main reason they seek to appoint new Managing Agents and it’s one of the main reasons prospective clients get in touch with us. I’d also add that, in our experience, we’re more likely to be approached by an RMC using a national Managing Agent than one using an independent agent.
This suggests that you may be more likely to experience poor service levels from a national organisation, so, when answering the question ‘Why choose an independent Managing Agent?’, getting a much better level of service is the first answer.
Why do Independent Managing Agents Provide Better Service?
This may not apply to all Independent Managing Agents, of course, but to answer this question from a Casserly Property Management perspective, it might be useful to look at some of the reasons why you may be more likely to experience poor service levels from a National Managing Agent.
Coming back to the RMC at Spath Holme, it took them some time to reach the point of no return, when they finally made the decision to go ahead and replace their National Managing Agent. This is understandable. I mean, if you’re experiencing poor service levels, it’s natural to give your current agent the opportunity to improve, isn’t it?
This is what the Spath Holme RMC did. Repeatedly. But service levels didn’t improve and, eventually, the decision was made to replace their National Managing Agent. Once that decision had been made, they knew it was important to take a rigorous approach to appointing a new one.
Why?
Because the biggest fear for the Directors of an RMC is that they spend a lot of time, effort and energy researching, interviewing and choosing a new Managing Agent, only to find that they’ve jumped out of the frying pan and into the fire, where poor service levels continue with the newly appointed agent – or even get worse – both of which would be a disaster.
If you happen to be a Director of an RMC and you’re reading this from the perspective that you’re seriously considering changing your existing agent – or have already decided to change them – I’m sure you’ll understand and appreciate exactly what I’m talking about.
In this case, the RMC Directors at Spath Holme did take a very rigorous approach but an added - and for them - an unexpected complication, was the fact that our Management Fees were 50% less and our Health & Safety Fees were a staggering 80% less than those charged by their previous National Managing Agent. Given that, in life, we tend to have this belief that ‘you get what you pay for’, it’s completely understandable that such large savings complicated the decision for the Directors of the RMC.
I’m sure those same circumstances might give you pause to think twice if you found yourself in the same situation. Can an independent Managing Agent provide a better service when they’re charging less?
The Truth About Economies of Scale
We tend to think that 'economies of scale' apply to all large organisations but the truth is, whilst economies of scale do apply to manufacturing industries - often dramatically reducing the cost of a product as prodcution numbers rise - when it comes to service industries, like Block and Estate Management, they’re still incredibly labour intensive – even if you have access to the best, most highly efficient systems available.
In practice, the underlying costs for National Managing Agents are always higher than for independent Managing Agents like ourselves. This is due to the fact that national organisations require increased layers of management, as well as a whole host of other things such as much larger, far more costly premises and the need to use other national companies to ensure the provision of nationwide coverage for all of the maintenance and support services they need to provide for their clients.
This means they need to contract in services from other national organisations that are also in service industries where economies of scale don’t apply. Scale in service industries only ever serves to increase costs – and those costs have to be passed on to you, the client.
As an independent agent that focuses on providing our Block & Estate Management services in a clearly define area – that being Manchester and the North West – we don’t have any of the huge additional costs that go with national organisations. Lower costs means we can charge less whilst providing a better level of service, which is one more good answer to the question, ‘Why choose an independent Managing Agent?’.
A Dedicated Property Manager
Another consequence of the additional layers of management in national organisations is that you, as a client, may never speak to the same person twice in your dealings with your National Managing Agent. And the people you do deal with almost certainly have an unprecedented workload. This is because a) each individual or team will generally have a larger portfolio of clients to deal with and b) consistently poor service levels will always result in a greater demand on the time spent on each issue. This leads to challenges with communication, which leads to even more poor service.
Every time you speak to someone new, you may have to explain much of the situation again because, even with good systems, the time pressures lead to poor quality note taking in the system.
This provides us with another great answer to the question, ‘Why choose an independent Managing Agent?’ because, here at Casserly Property Management, we take great pride in the fact that you always have a single point of contact in your appointed Property Manager. They’re always up to speed with anything you’ve previously spoken about.
The Marvels of Modern Technology
My final answer to the question, ‘Why choose an independent Managing Agent?’ – at least for this post - comes down to technology. We now live in a world where small, independent companies are easily able to compete alongside national or even international companies when it comes to highly efficient and effective systems because the latest technological advances make them easily accessible via Software As A Service – or SAAS.
This means your National Managing Agent no longer has the advantage of access to highly efficient proprietary systems that are too expensive for smaller, independent companies to access, as was once the case. We now have access to comparable systems that are every bit as efficient - sometimes even more so. This is because some National Managing Agents still have their own proprietary systems that are old, expensive to update and, quite possibly, a little (or a lot) out of date. Consequently, they may also be less efficient than the latest SAAS platforms, which are easily accessible, highly cost-effective and are being updated and improved on a daily basis.
In Summary
There are other good answers to the question, ‘Why choose an independent Managing Agent?’ – some of them dependent on your specific situation - but I’m going to stop with these four. Just to recap on them quickly, as an Independent Managing Agent, Casserly Property Management are able to:
You can probably imagine how, by focusing on these answers to the question, ‘Why choose an independent Managing Agent?’ we were able to explain them to the Directors of the RMC at Spath Holme and help them deal with their perfectly natural concerns over whether we could really deliver a greatly improved level of service for them, even though our costs were so significantly lower.
As I mentioned before, we commenced the management of Spath Holme in June 2024 and the feedback from the RMC has been excellent.
If you’re a member or a Director of a Residents Management Company and you’re currently frustrated by the poor service levels you’re receiving from your current Managing Agent (national or independent), please do get in touch (use the button below) and take advantage of a free, no obligation consultation. I’d be delighted to explain how it all works and answer any questions you may have.
You might also like a copy of our free eBook, ‘The 6 Topics to Review When Removing a Poor Managing Agent and Appointing a New One’, which you can download by clicking here.
Best wishes,
Paul
Paul Casserly
Casserly Property Management
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