In this series, Respage CEO Ellen Thompson discusses the latest trends in the multifamily industry and how apartment communities can generate greater results.
We all love free stuff, and so do your residents. That’s why the go-to move when things get soft is to offer a free month of rent. Of course, that free month comes with terms and conditions; the resident must pay for the rest of the lease term.
Most multifamily software suppliers use free trials to give prospects the opportunity to see that their products integrate with their systems and deliver the benefits that were promised. At Respage, we are no stranger to free trials and offer non-binding ones that allow for service to continue at a pre-negotiated rate for our AI leasing solutions.
Some suppliers now offer a free year of service in exchange for a longer term contract. On the surface, this sounds like an amazing deal, but buyers beware.
Suppliers offering long free terms often have products that aren’t quite as good as the alternatives you’d need to pay for now. But even when the products are equally robust, it is a mistake to enter into a long term agreement*. Here are a few reasons why.
First, just a quick glance at Layoffs FYI will remind you that real estate solutions providers large and small have not been immune to layoffs, and there are more to come. Even a 10% staff reduction can dramatically affect retention of those who are left, slow the pace of new feature development, and impact daily customer service support of your solutions.
Second, while late stage funding is more difficult to secure, there is still a lot of investment in early stage software startups. Their solutions, once fully realized, could change the product landscape. Or an existing product can evolve in a major way to do the same. Not ideal if you’re already locked in to something.
Third, there is a good chance that the solution you are evaluating will be part of a larger platform in a few years. While point solutions suppliers that solve one pain point drive a tremendous amount of innovation in the multifamily industry, there is universal vendor fatigue and most folks are looking for platforms that efficiently bundle multiple solutions together. Larger players are constantly developing and acquiring new products which they bolt on, sometimes for free, and this usually improves efficiency and operational costs.
Before you sign, evaluate the potential risks and total cost of ownership of multi year agreements keeping in mind that sometimes something free ends up being very expensive in the long run.
*Unless there is hardware involved in which case they are necessary.
From the desk of Ellen Thompson, Co-founder and CEO of Respage >> Since its founding, Respage has helped over 10,000 communities attract, engage, and retain residents. Its platform assists properties in generating leads, automating leasing, and managing reputation and social media. Thompson is also the Founder of Results Repeat, a digital marketing agency that has helped hundreds of companies create a digital presence and use SEO and paid marketing to generate more business online.