Short Summary
If you're feeling frustrated and overwhelmed by the lack of progress despite implementing various strategies to improve your short-term rental business processes, then you are not alone!
Our guest today, Cody Wood, scaled his short-term rental business to over 150 properties in just eight months. But when he realized that not all of them were profitable, he had to make some tough decisions. Now, Cody is sharing his secrets for success, from process mapping to redundant tech systems. But will his strategies be enough to keep her properties thriving in a competitive market? Find out in this must-listen episode.
In this episode, you will be able to:
Grasp the importance of integrating suitable systems and procedures in the realm of short-term rental administration.
Delve into the art of maximizing property income by employing the 80/20 rule
Familiarize yourself with the essentials of standard operating procedures and their impact on refining the guest adventure.
Recognize the value of maintaining vigilance in tracking metrics and performing upkeep for thriving short-term rental enterprises.
Explore the benefits of automation in the hiring of virtual assistants and the effective coordination of your technology arsenal.
Cody Wood is a former aerospace and defense professional with over a decade of experience in systems and processes. Cody transitioned into the short-term rental industry in 2020 and quickly applied his expertise to scale a company from 75 to 150+ properties in record time. Now, as a go-to expert in the industry, Cody shares his insights on the importance of efficient systems and processes in managing successful STRs. His laid-back personality and friendly demeanor make him an engaging resource for STR operators looking to improve their businesses.
Action steps mentioned in this episode are:
Map out your process and create standard operating procedures for your team to follow.
Implement monthly maintenance checks to ensure the property is in top condition.
Score your housekeepers and address any issues immediately.
Use digital screens in properties to allow guests to give real-time feedback and address any concerns.
Track occupancy, future bookings, and marketing platforms biweekly to ensure overall company success.
Optimize your listings to ensure they are successful and profitable.
Identify the right client for your business and work with those who align with your personality and values.
Use technology to automate and streamline processes wherever possible.
Focus on maximizing income from each individual property rather than getting as many doors as possible.
Process Mapping
Implementing process mapping in the management of short-term rentals (STRs) can greatly improve the guest journey and overall operation efficiency. Mapping out each step of a process, from communication to resolving issues, allows operators to have a clear understanding of their business and its workflows. This visual tool helps identify areas for improvement, streamlines operations and optimizes the guest experience. In his conversation with Tracie Fowler, Cody Wood shared how he used his background in aerospace and defense to develop standard operating procedures and processes for his STR business. He advised operators to map out the guest journey, including pre-stay communication, check-in instructions, and incident resolution. By defining timelines and addressing potential scenarios, STR operators can effectively delegate tasks and focus on growing their business.
Implementing Technology for Property Success
Integrating technology and automation into STR operations can maximize efficiency, scalability, and income per property. By automating processes and using various software solutions, operators can save time, minimize human errors, and track the performance of their properties effectively. Cody explains that utilizing communication and project management tools like RingCentral, Slack, and Trello improved his team's collaboration and management of tasks.
The right combination of software solutions can also simplify processes, provide valuable insights, and enhance overall performance. To achieve this, Cody uses parallel systems, Jurny and Hospitable, which cater to different types of properties. These platforms offer various features, including reservation management, communication, and review tracking. His comprehensive tech stack serves as an example for STR operators looking to optimize their operations.
Link and Resources
Subscribe for free episode bonus materials: https://www.thestrinsiders.com/
Join the conversation with Tracie on Facebook: https://www.fb.com/groups/strcentral
Follow Jacquie on Instagram: https://www.instagram.com/5starbnb/
Connect with Cody on Facebook: https://www.facebook.com/BrandonCodytheCowboyWood
Connect with Cody on LinkedIn: https://www.linkedin.com/in/cody-wood-423a0978
Programs Cody mentioned:
Transcription
00:04
Tracie Fowler
Welcome to The STR Insiders Podcast. We share tips for achieving your STR goals. AHA moments, funny stories, and all the latest gossip of this STR life. Listen in as we keep it real and maybe a little sassy. Celebrate successes and own all the mistakes we've made along the way. Whether you're new to real estate investing and new to short-term rentals or a seasoned pro, there's something here for you. Jacquie is an STR property manager who consults with individuals looking to grow their own property management firm. Traci owns STR Consulting, a media firm that provides education to investors who want to learn all about STR investing. For more information, please visit www.thestrinsiders.com.
00:54
Tracie Fowler
Hi everyone, and welcome to episode 14 of The STR Insiders Podcast. Today we're talking to Cody Wood about systems and tech stack. So hold on for your system deep dive. All right, Cody, so tell us a little bit about your background before you came to the STR world so people know why you're such a systems nerd.
01:18
Cody Wood
Sure. So my background is I have over ten years in aerospace and defense systems and processes are basically what is bred into you. When you start into aerospace technology is then kind of packed on top of that because again, I don't think any more technological advances are probably bigger in the world than in the aerospace world and then also in the defense industry. Yeah, that's kind of my short background. I also like to call myself the recovering engineer because moving into this industry was a lot less stressful.
01:52
Tracie Fowler
Good. And when did you get started in short-term rental?
01:55
Cody Wood
So I started with my own property in 2020. Great timing, I know, but basically I stayed booked through all of COVID kind of very little tech involved. I think at the time it was only smart B and B, so before it was hospitable. And at that point I realized that this was very easy to do, very easy to automate, and as long as you have the right systems in place, it's very scalable. Basically, after dealing with my own property for about a year, I realized that it was taking me very little time to do the short-term rental game. And I quickly partnered with a guy that had 75 properties, no technology really other than also smart B and B.
02:37
Cody Wood
And what I quickly realized is that as soon as I started putting the systems and processes into the company, we scaled it to over 150 properties within eight months.
We were really basically I realized though, at the 157 properties, we didn't have enough systems and processes in place to really keep us successful. We were succeeding in some properties and then failing others. So some properties were doing great, and some properties weren't. And that's just because we had certain systems that were kind of the backbone, which was great, and certain technology. But then I also realized you also have to have the right client and understand what that is. And so we started scaling back properties. And right now, we sit a little over 60 properties, and we're just as profitable as were at 157.
03:23
Tracie Fowler
Whoa.
03:24
Jacquie Mosher
So what is the right client?
03:27
Cody Wood
The right client is one that's going to work with your personality, in my opinion. But I think there are really three different types of clients. I believe there's a brand new person getting into the industry, the short-term rental game. They have no idea. They have no education. So you're going to spend a lot more time holding with that client. Then you're going to have the investor who is like, I don't care as long as I get a paycheck, or that you tell me what you're doing and keep the property running. And then you're going to have the homeowner. The homeowner is the one that's going to be probably the toughest client to deal with because they're going to micromanage. Not every homeowner is that way. But the thing is that you have to kind of decide.
04:04
Jacquie Mosher
Do you mean like Traci? No, just kidding. She just cares a lot. Thank you. Do you want to tell me a little bit about the 80-20 rule?
04:13
Cody Wood
80-20 rule is the Pareto principle. So 80% of your revenue is only going to come from 20% of your clients. So if you think about me having 157 properties, beginning of January 2021 and today, as of May 2022, I'm sitting at about 65 properties. I was making almost 80% of my revenue from only 20% of those actual 157 properties. So in essence, about 40 of those properties were actually most profitable. So the same time, it takes me to manage 157 properties, I'm actually spending that now focused on those properties that were profitable and keeping them profitable versus wasting hours and hours on too many properties.
04:56
Jacquie Mosher
I just have to say yes and have to jump in here, because this is something I have been saying for a long time that a lot of property managers don't quite understand. Because I meet a lot of property managers who are like, I need as many doors as possible, and I'm going to do everything it takes to get as many doors as possible. And you listen to all these other podcast episodes, and they're like, how do I get more doors? Right? And for me, I turn away new clients daily, at least once, if not more. And for me, it's always been, how do I maximize my income from each individual property that I have? Then I'm able to give each property more attention because I have fewer properties, but I'm making more money than your typical property manager that just has a million doors.
05:43
Jacquie Mosher
I support this. This is genius.
05:46
Tracie Fowler
The other side of this, too, is that 80% of your time is going to get taken up by 20% of your units.
05:55
Cody Wood
Yeah, I mean, to add to that, I just fired a property quite literally last month. I looked at the costs that it was costing me and the revenue he was bringing in. He also has 157 other properties. And I just told him, I said, even though your property is a Lake property, it's a beautiful property, I love this property, but we're not cutting it. So I kind of fired myself, I guess you could say. But at the end of the day, if my tech and labor cost are higher than the revenue I'm making, it's not worth my time.
06:21
Jacquie Mosher
I mean, you want your clients to be successful, and not everything on your portfolio is going to be like the best Airbnb investment or STR investment. So you have to make those decisions.
06:32
Tracie Fowler
So let's switch gears a little bit and talk about some of your systems and processes.
06:40
Jacquie Mosher
Give me all your secrets.
06:44
Cody Wood
I knew this was coming.
06:46
Jacquie Mosher
Or just tell me about process mapping.
06:48
Cody Wood
That's a great starting place, actually to talk about process mapping. So I recently had a conversation with one of my own team members and they called it an SOP. And what he actually sent me was a work instruction, which they are drastically different. I just want to make that clear to everybody. Really a good process mapping and I would share this with anybody grab a whiteboard, take that whiteboard, actually take some sticky notes and map your process. So the first thing I did when I started with this company was I mapped my guest journey. So the guest the journey is looking like, okay, I know that the guest is going to book on either platform just as an example. If you're starting out, it's going to be Airbnb, probably, or VRBO. Okay, how do they find your property then?
07:33
Cody Wood
What happens next? They're going to get your automated check instructions or they're going to get, hey, welcome. I'm so thankful for you booking me. What is that? Communication process. When did they get the check instructions? And so you're kind of given a timeline. So like okay, guest books. Guests say the booking starts in two days. Okay, do the check instructions come maybe 5 hours before they check in. 2 hours before they check in? Or do you send it right away? What is that process? And then as you're mapping this, you'll define better steps. Say, you know what, I don't want to send it to them right away because I don't want them checking in early. Okay, well then send it in 2 hours.
08:11
Tracie Fowler
Cody, people never show up early. Come on.
08:16
Cody Wood
I actually had a guest try to message me at 08:00 a.m. One morning and I'm ready to check-in. I'm like, you don't start until 04:00 p.m. What are you talking about?
08:25
Jacquie Mosher
That happens sometimes.
08:26
Tracie Fowler
Do you remember Jacquie, we had someone show up once. They showed up in the morning. Now they don't get check instructions, so they don't have a code or anything and they knocked on the door while a previous guest was still there.
08:44
Cody Wood
And that's another thing like when you're doing process mapping, what do you do in the scenario when something like that happens? Map that out. Now if you've mapped this journey, what's going to happen is you're going to have a standard process. So for example, if you have an admin team or a support team, or a customer service team, you can now pass this along to them. And then if any of these questions come up or these incidents happen, guess who's not getting a phone call? You. Because now they're just following your train of thought at that point. And so now you can write standard operating procedures if this happens, we do this. So last night, perfect example, we had a gas leak at one of our properties. Obviously, we had the fire department show up.
09:29
Cody Wood
Our team notified us, and we checked on the guest.
We basically relocated them today. And we already have everything moving in the process right now for the property to get back live with a plumber coming out, working with the city of Dallas to get certified to make sure it's all good to go, to be rebooked. Everything just followed our process. The fire department shut off the gas on the property. So they took cold showers this morning. We leaned into it, and we said, hey, polar bear plunge, great job this morning guys, just having fun with it. But I mean, these things happen and you're going to experience them. So plan them out.
10:06
Tracie Fowler
Obviously addressing the Urgency and the needs. First the emergency services, the repair accommodating, but then also making light of it in a way, not taking it too seriously, not getting so up in your head about it that you make it more than it was with the guest. The guest is fine. You took care of them, you did what needed to be done and now you're just kind of like, well that sucked, but the way to power through it.
10:34
Jacquie Mosher
I think what's great about having these systems in place and that they're just following the systems and making things happen is that you are able to make light of it. You are following the map that you've already created and that kind of leaves that opportunity to keep it positive and make it fun.
10:52
Tracie Fowler
So what kinds of KPIs are you setting as far as measuring your success and your performance overall?
11:01
Cody Wood
So I have several meetings set up with KPIs. So I do my weekly meetings on Mondays where I actually sit down. I go through my customer service metrics. So each of my departments, I have several different departments that are actually measuring. So I have customer service, I have vendor support, I have marketing, I also have sales. And then I also have my It and Technology training department, more or less. My customer service is measuring the Occupancy. They're also measuring future bookings coming in. So that way we kind of have a quick window every week of what's booked and what's coming. We're also tracking how our reviews are going. Are we staying in super host status if you're on Airbnb? And then at the same time, how many reviews do we need at this level to get back to super host status?
11:50
Cody Wood
And so then when we roll into our vendor support, then we're talking about how much money are we spending on maintenance per property? Now we're talking about how many maintenance orders we've had in the last seven days. I'm really tracking to see, like, a certain property. Got some serious maintenance issues that are coming up that I needed to notify the homeowner. One of the things that we implemented was monthly maintenance. That's really critical. So these are some of the things that we're tracking, and we're making sure certain items are being touched, certain items are being fixed. We've gotten to the point where one of the metrics we track is, did we change the batteries in the smart locks every month? I mean, it's simple, but I don't have to worry about batteries going dead.
12:27
Tracie Fowler
Well and failed check-in is, I think, one of the best ways to screw up your review before it even got started.
12:35
Cody Wood
Yeah. And then, of course, we're also checking then for the housekeepers. I'm scoring every one of my housekeepers every turnover. We also have digital screens in our properties where, when the guest walks in the door, it tells them their name, and says, hey, welcome to our property, similar to, like, Marriott. And then at the same time, it also allows them to give me a check-in score. So they're scoring me as soon as they walk into the property. And one of those scores is cleanliness. So if they tell me the property is four out of five, I'm picking up the phone and I'm calling. I'm wanting to know what's wrong. And then from there, I'm immediately responding to my cleaner and saying, hey, I need you back over there. I need this fixed, or maybe it's a maintenance item.
13:16
Cody Wood
And then I'm calling my handyman saying, would you like me to take care of that right now?
Or would you rather I wait until after your stay? Is it something you need right now? I'll send them. But by doing that, the guest already knows right out of the gate, I care. Then on the way out, the same thing. They give me a checkout score. Then when my cleaner gets there, of course, we're checking, did you do your reports? Did you give us our photos, videos, things like that? So from there, we move into our sales. So I'm tracking new clients that are onboarding, possibly, or maybe we're off-boarding, making sure that we get all of our technology back, that we may have implemented the property same time. Also that we're implementing all the technology we need for the property to be successful.
13:55
Cody Wood
We're also tracking, do we get all the listing optimized? We're doing quite a few things in the sales process to where it's a lot more than most people probably would care to track. Then we get into our It. Are we having any issues? Is our WiFi strong in all of our properties? Are we tracking our PMS? Like, are there any issues that I need to be aware of? Something that's come up in the last week that's causing a lot of havoc amongst our properties or even our listings. So there are quite a few metrics that I'm tracking weekly. Then probably the other metric that's probably going to be more pertinent to higher level PMS is I get into biweekly tracking. So this is where I go from the 1000-foot view to the 30,000-foot view.
14:36
Cody Wood
The 30,000-foot view is your company even healthy? Are you successful or are you failing? This is where I track overall. Occupancy. I'm looking 30 days back. I'm looking 30 days forward. I'm looking a little bit higher level. At the same time, I'm looking at my marketing. What platform are we booking from? Those are kind of some of the high-level metrics that I track, and I just see a lot of benefit in tracking it that way.
14:58
Jacquie Mosher
Very cool. You had mentioned how you were doing monthly maintenance at one point in there. I would love to know what things you have done every single month when you sent your handyman back.
15:10
Cody Wood
Sure. So for us, it's going to be we're checking every single light to make sure that every light is working. Most people think that's crazy, but you would not believe how many lights go out in between monthly maintenance.
15:22
Tracie Fowler
At least three bulbs out in the condo. I'm staying in right now at least.
15:28
Cody Wood
Yeah. And it's super simple. So that's one thing I'm looking at. The other thing I'm doing is what I call 36 and below. So 36 inches on the wall and below were basically the size of a suitcase where they're scuffing up as they're coming in. I'm going in there and I'm touching it up at least once a month, especially during the busy season, because I want to make sure that the property looks spotless. Batteries. Oh, man. I change batteries every month now. It's just not worth it. Remotes smart locks. It's simple. By doing this, you eliminate 99% of your headache. The other thing is the air filter. You should change this every month, just period. At the same time, I have my guys walk around with a Clorox bottle.
16:09
Cody Wood
They take a little cap full of Clorox, and they dump it into the actual drip line so that way if there's any growth in there, Clorox will clear it out. That's super helpful maintenance for your guys to do when they're changing the air filters. So those are kind of some of them.
16:24
Jacquie Mosher
The things we have a similar system. And then I was thinking the only item on the list was Snaking drains that I didn't hear, which is something we have them do is check because those drains everywhere. They constantly need to be snaked well.
16:37
Cody Wood
And also dryer duct is the other thing to add.
16:39
Jacquie Mosher
And that too, yes,
16:42
Cody Wood
It's easy to do and it builds up faster than most people realize. And then I also have my guy walk the outer perimeter of the property because I'm looking for cracked windows anywhere there could be leaks. And then also check the blinds because that's the other thing that gets damaged more than anything is the blinds.
16:58
Jacquie Mosher
Blinds are constantly breaking. I always wonder what guests are doing to break blinds all the time. I'm blown away like every single time I'm on site I see a set of broken blinds. It's unbelievable.
17:12
Tracie Fowler
So you've told us about your systems and process. Can you tell us a little bit about your tech stack? What tech are you using to implement all of these systems?
17:25
Cody Wood
So basically I have two parallel systems, so I have a redundancy of tech. Most people would be like, that's really expensive. And it is. But my tech actually when I calculate it out for every property, it comes up to like about $20 per property. So it's really not much. But that's also understanding your numbers. So MyTech I have one system, which is JURNY. J-U-R-N-Y. JURNY is more of a connector system. They're kind of developing their PMS, but we signed up with them because they had a lot of integrations that were really great. They have what's called the JURNY MoS. It's about $60 a month. But JURNY is great because you can basically take your property, put it on there, and then immediately connect to multiple OTAs or different platforms to list your property. They also include Breezeway with that, which is huge.
18:15
Tracie Fowler
Wow.
18:16
Cody Wood
Because now you don't have to go spend $1,000 to onboard with Breezeway. You immediately get that when you sign up for this deal. They bring in a review tracker. So they're tracking your reviews. They give you the Journey app, which is also a way for people to book your property. It also allows the guest to actually control the thermostat and the door lock coming into your property if it connects with their system. And then of course they have their complete listing revenue management through Wheelhouse, which is also great. So they're bringing a lot of great systems for a really good price. They also include gut screening with that. So auto hose, super hog, all that's integrated into there. You really have a lot of great features with them.
18:56
Cody Wood
And then of course you also have their if you have a direct booking website, they can connect it and connect the calendars so that way it communicates between Airbnb VRBO and your direct booking website.
So really cool, a really good price. Honestly, if you really understand what the cost of all that tech is it's not cheap.
19:13
Tracie Fowler
No, that's amazing, honestly.
19:17
Cody Wood
Yeah. So that system is really great. Of course, they have the automated, unified inbox automated messaging, all that stuff, which is great. So then in parallel to that, I also still have hospitable because I don't have every property on JURNY. So I have to still kind of piecemeal some of my tech, which is fine. Then I also have software called Easy Care. There's a lot of good stuff with Easy Care, a lot more customization. The only problem is, if you're going to use Easy Care, I will tell you, it feels like you went back to 1996. It looks like the first version of Windows when you're using it. Now the great thing is Easy Care interfaces really well with vendors. So I make every vendor agree to use that. So they have to download the app.
19:58
Cody Wood
I send them the work orders through Easy Care. They take their photos, they can even put in their invoicing. So it's immediately sent to me right away. So it's really great. The other thing is, Easycare does have a tracking software tied into it. If you have w two employees, you can track their mileage and where they're driving. So if they're making random pit stops, easy Care will report that while they're working through the app, they're not using the app well, you're not going to see that. They also have inventory management. Again, similar to complementary to Breezeway, you're not going to get much difference other than the fact that Easy Care is a lot more, I would say raw. So there's a lot more customization you can do where Breezeway is a much easier user-friendly software to interface with.
20:42
Cody Wood
Then I also use RingCentral for contacting my virtual assistants or my online specialists as I call them because they are specialists inside of our company because we have different departments, which is our phone tech stack. And then of course we also utilize Slack for our internal team communications. And then Trello is our project management. So since I implemented Trello, we used to have a lot of our maintenance items, cleaning issues, customer issues, and guest issues, they would slip through the cracks just because Slack got really busy. Since we moved to Trello, we've had an almost 100% completion rate of our items for maintenance, cleaning, and tracking. Wow, that's just kind of a testament to my team. They took the reins in Trello. I kind of set up the board for my operations and then basically we track everything in the operations board.
21:34
Cody Wood
If there is something that happens during the guest day, we actually move it on that same board immediately to the claim process and we start the claim filing right there in Trello and track it. So that way we know where we're at. So it's not such a hassle for my claim personnel when they're filing because everything's right there on that card. And then of course we do have email, but that's really the main tech stack. And then of course for taxes, hotel taxes, we use Avalara, my lodge tax, and then QuickBooks, which I have a love-hate relationship with right now
22:07
Tracie Fowler
I think we all do. So you mentioned VAS. What kind of process do you have for hiring VAS?
22:16
Cody Wood
Yeah, so my process is actually automated. Basically what I've done is I post a job on the job boards, kind of what I want from my VA. And then I put in, hey, in order to apply for this position, you need to email me at my email on Google. And then through Google, I have it to where it's automated through some templates. So depending on if they follow the structures correctly and they follow the subject line as I tell them in the job application, then it will automatically trigger an email back to them and it will send them to a Google form which then asks them questions. I actually have them automatically record themselves, automatically tell me their internet speed and then I have a trick question in there and say, tell me your age.
22:58
Cody Wood
But in the job application, if they are detailed, it tells them to put the age of 40. Because I don't care about their age, but I want to see if they can follow instructions.
23:07
Tracie Fowler
Nice.
23:07
Cody Wood
So I had over 2000 applicants apply for my customer service roles last year in June, and I actually only had to look at 26 that followed the instructions. And then of course, once that kind of goes through, there's a secondary interview and then obviously then I make my decision with the team at that point.
23:26
Tracie Fowler
Are you doing the secondary interview?
23:28
Cody Wood
Yes, I'll get involved in the secondary interview, but before that, I'm not involved. So basically it's streamlined, washed from the first 2000 to the actual filling out the form. Then they filter it and then they kind of tell me, hey, these are the top 26 out of 2000 applicants that you need to look at. And I'm like, sweet.
23:47
Jacquie Mosher
I just have something that I'm itching to know because there's no good solution that I've been able to find and I just don't know if you happen to know, is there a reliable solution for changing door codes and keeping them different for every single guest that's reliable that you can automate.
24:07
Cody Wood
So I've done that through Remote Lock. So when I've connected Remote Lock to Airbnb VRBO, it automatically will generate the codes, and keep them randomized. Since we made the connection between remote lock and Airbnb or VRBO, we really haven't coded the doors since because it automatically codes them and it codes them in that time frame, which is really great.
24:29
Jacquie Mosher
What was the biggest game changer for your property management company? And if a host was going to do any one thing, what one thing would make the biggest difference for us?
24:39
Cody Wood
It was really putting in systems and processes. Honestly, I know that's kind of obvious but shocker y'all, but I mean, in all honesty, repeatable is scalable, chaos is not. And if anything, chaos, all it's going to bring is heartache and frustration not only for yourself but your clients and your guests. And if you can have repeatable systems that you can constantly repeat, no matter what property you go to, you're already a full head ahead of the other PMS in the area because they're going to be struggling to try to figure out so repeatable is scalable, chaos is not.
25:14
Jacquie Mosher
There you go. I'm going to tattoo that on my body now.
25:17
Tracie Fowler
So I'm really grateful that you took the time to dig into really the details of Structuring, a successful sustainable management company. For anyone listening. If you enjoyed this episode, definitely check out the links because we will provide some of these resources. And stay tuned because, in our next episode, Cody is going to tell us the structure to capturing insurance relocation bookings.
25:48
Jacquie Mosher
If you enjoyed this episode, we'd be so grateful if you rated and reviewed it. Also, subscribe for more insider knowledge, we can help you get the edge in the STR world. You can find additional resources for your STR journey as well as our social media handles at Thestrinsiders.com.
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