Businesswise: A practical guide to short term rentals
In fact, my rule of thumb is: If it sounds too good to be true, it always is. But as with most things in life, there are exceptional cases.
My recent article titled 'Earning big from your extra space' highlighted one of the simplest, most feasible opportunities for people to earn millions of dollars in extra income each year, even in this challenging economy. It's not a get-rich quick scheme by any stretch of the imagination, but it can enable persons to build wealth over time with some capital investment and consistent effort, all things being equal.
For those who missed it, I revealed that some Jamaicans had been earning tens of thousands of US dollars each year by renting extra space in their homes on a short-term basis with the help of a company named Airbnb. In a few cases, enterprising individuals were offering a couch, an air mattress in a living room, and even a shack for rent.
I was therefore not surprised by the overwhelming enthusiasm and excitement of readers. I received a flurry of emails and Facebook messages expressing gratitude for the information and asking me for more details on how to get started, with a few readers wanting steps to "guarantee making money".
I can't offer any strategies that will guarantee you'll make money. There's no such thing. However, I will share some insights and steps you can take to increase the likelihood of success.
1 Investigate and collect data
The best way to get started is to be informed. I know you may be eager to make money, but to do so consistently, you must learn the history, existing conditions, emerging trends and future prospects of a venture.
Review a few dozen listings for Airbnb in Jamaica and other Caribbean islands. Pay close attention to the top-rated listings and examine the reviews. Apply those common best practices to your own listing.
Unless you have the wherewithal to withstand big financial losses, start with what you have. I wouldn't suggest building an addition or buying property initially unless investment-property acquisition is part of your wealth-creation strategy. You can test the waters by fixing up a spare bedroom or creating a self-contained unit within your space.
3 Transform your space
The investment you make in your space is critical. Guests want comfort. Bedrooms should be air-conditioned, with cable TV, radio, telephone and Internet. The top-rated listings on Airbnb have these amenities or more. The beds must be freshly made, with linens and pillows available. Bathrooms must be immaculate with clean towels, rags, tissue and soap.
Clever hosts wow guests with welcome baskets of local goodies such as teas, biscuits and fruits. Expert hosts prepare a booklet with all the information guests typically need - check in and check-out times, wi-fi passwords, cable-channel listings, emergency numbers, host contact details, etc.
4 Create an experience
Inasmuch as Airbnb travellers and others are looking for a bargain, they also value the experience. Guests share good and bad experiences on social media, more so the bad. A good experience is something you have to plan and create.
From the minute you respond to their query, to when they first arrive at your residence, to the point of checking out, every step of the process must be planned.
Enhancing guest experience involves delivering excellent customer service, ensuring a clean, comfortable and serene space, and giving them as much information as possible on how to entertain themselves in the area and Jamaica generally. Tourist brochures, guides, maps, restaurant listings, taxi information are all helpful.
5 Develop customer-service standards
We all should be concerned about the quality of service travellers/tourists receive in Jamaica because bad experiences reflect negatively on our brand, on which many people depend for their livelihood. In my review of Airbnb, I noted a few negative reviews.
One traveller was disgusted at the condition of a particular room and the attitude of the host. To add insult to injury, the host responded on the website by noting that the guest booked the cheapest room, came on short notice, and had a bad attitude. In customer service, that's an absolute no-no!
You never want to get into a fight privately, much less publicly, with a customer. The best thing to do is apologise that the experience was not what you or they had hoped for and try desperately to make it up with, for example, discounts on future stays.
Anyone who wants to venture into short-term rentals needs effective customer-service training; they need to develop procedures for complaints, difficult customers and service recovery.
6 Outline a marketing strategy
Outfitting your space for rental requires financial investment and personal effort. In order for you to make the most from your investment, you should outline a marketing strategy for how to attract new customers and keep existing ones.
Note that you don't have to use Airbnb to rent your space for hard currency/attractive rates. You can create a listing in the classifieds, directory or google ads. You can even develop social media pages specifically to promote your space to expatriates, members of the diaspora, and persons other than tourists.
n Yaneek Page is an entrepreneur and trainer and executive producer of 'The Innovators' TV series. Email: email@example.com. Twitter: @yaneekpage. Website: yaneekpage.com