Some vacation rental business owners are on auto-pilot, riding the wave of a new industry, seeing where it takes them. While others are biting the bullet, taking the bull by the horns, and defining their own vacation rental success.
Coming off a marathon consultation of over 500 owners one-on-one, I wanted to share the code by which this second group of over-achievers tends to do business. By sharing "the stuff they don't tell you," I hope newcomers can enter with more realistic expectations and those currently looking for guidance can more quickly assess their business' long-term health.
1. Getting started is easy, getting sustainable is hard
Putting a vacation property on listing sites and hosting guests immediately is surprisingly simple. But short term success and long term sustainability are two totally different things. Inevitably adversity sets in and we arrive at a fork in the journey where some hosts opt out and others commit to getting serious...
The individual who pushes through the adversity ends up realizing he or she is capable of more, gains an entirely new perspective on the business, strangers come out of the woodwork to help...etc. The soft theory is that hard times in a vacation rental business are necessary for sustainable success. The strong theory is that one simply cannot sustainably succeed without these sorts of transformative moments. The good news is that if you're in a jam, first of all it is normal, and second, it's likely the sign of good things to come.
2. Lack of time is lack of focus
"I just don't have enough time," is probably the most common excuse we hear when trying to motivate vacation rental hosts to do better work. I have kids, another job, a busy month planning my cousin's wedding...etc. I can't be everywhere at once!
But what these folks are really saying is that "improving my vacation rental business does not fall high enough on my list of priorities." Which is fine: not everyone is serious about improving or growing. But those who are serious know that vacation rentals require sacrifice: owners can benefit from recognizing this excuse for what it is (an excuse) and reassessing what's important or by simply admitting it's not something they want to pursue wholeheartedly.
3. Setting goals resolves a bizarre amount of dilemmas
This advice falls into the category of "smallest change, greatest impact." Unlike the way most small businesses start, very few vacation rentalists began their business deliberately with a specific goal. Even as we grow, the process of articulating our goals gets overlooked because we get distracted, overwhelmed, or even tricked (into thinking that listing sites make us truly successful).
Not having specific goals can be a major source of stress because there's no frame or context to justify our decisions. Without planning towards specific goals, we are drifting without a compass -- without as much as lifting up our heads to see where we're going. Every step you can make closer towards defining exactly what you want from your vacation rental business, the less stressful (and more enjoyable) the journey will be.
4. It's great to voice your independence, but be willing to work for it
There's a lot of pressure to make big decisions with limited information, which is why most vacation rental get angry or upset when listing sites change the rules. However, recognizing good advice or saying you're going to invest in a new strategy ain't worth bupkis (as my grandma would say) if you don't actually follow through.
Unless you have a big budget to hire or outsource your marketing, be prepared to get your hands dirty and fight for your independence. In the process, take solace in knowing that there is a path and that 1 is greater than 0 (i.e. doing something/anything is more powerful than doing nothing). Building momentum with action propels you from survival mode to sustainability and eventually to success.
5. If your business is not improving, it is likely shrinking and will probably die
This concept may be hard to stomach for some people. It was for me recently, when assessing my own business. But to be brutally honest, a great number of long-standing vacation rental businesses are not growing -- they are shrinking -- and will likely begin to disappear in the coming years. This is due mostly to complacency: years of experience may be helpful in some places, but it can also be blinding in others. Jim Collins calls this idea "hubris born from success":
Hubris is defined as excessive pride that brings down a hero or an outrageous arrogance or entitlement that inflicts suffering upon the innocent. Typically, when past accomplishment creates a sense of invulnerability and a guarantee of future success, hubris has set in. It is the false sense of security that we can create something from nothing as may have been the case when the firm was founded. - Jim Collins
If you think that plug-and-play with your VRBO or FlipKey listings will last forever, think again. If you do not have forward momentum, build some now and don't get lost in the shuffle.
6. The independents are leading the charge
Vacation rentals are one of the only industries in which independents (not big corporations) have the final say. Yet due to the fact that the movement is so new, there are very few rules or best practices for these independents to follow, which in turn, forces us to think on our toes. Most DIY-types thrive with vacation rentals for this reason. But in addition to problem-solving, we've learned that being a nonconformist is also conducive to vacation rental success.
"Once in a while it really hits people that they don't have to experience the world in the way they have been told to." - Alan Keightly
Choosing to run your business differently, being adventurous, going with your gut, exploring off the beaten path...these are huge virtues in our industry so embrace them and don't let any corporation or expert persuade you otherwise.
7. Never underestimate the little guy
"The average independent vacation rental host simply does not have the skills to become listing site independent," I read on a forum the other day. I actually read some version of it quite often and the irony is that I used to believe this statement. In fact, I myself, was a skeptic.
But in watching nearly 800 independent owners and managers in the Inner Circle doing it on a daily basis, I have become a total convert. This era of technology (MADE for neophytes like us) means you can never underestimate the potential of the passionate and the curious hosts -- especially when they have proven to be successful in life by acquiring that second home in the first place.
Conclusion
That vacation rentals are getting more popular is great (hey, more guests!!!) But it also means more competition challenging us to achieve the results we want from our businesses. It's not fun to have difficult conversations like these -- but I rarely regret having them afterwards.
Once you know the "unwritten rules" of the vacation rental game, you give your business the best chance to succeed in the long run. And of course, mine only represents one viewpoint. So what are your unwritten rules? please use the comments area below to share your words of wisdom...
