Add Beyond's Dynamic Pricing Tool as a way to grow Airbnb Business
2020 was a roller coaster ride for short-term rental hosts.
So, what did Airbnb hosts that stuck it out learn in 2020? And how can we apply those lessons to succeed in 2021?
I recently spoke to a host that grew his Airbnb business during the pandemic.
Steven Che Suarez is the Cohost of Live Let Thrive, a podcast about Airbnb and the sharing economy, and the Co-Founder and CEO of Argest Rentals, a full-service short-term rental management company. Over the last year I’ve learned a ton, and so has he!
We've got 9 tips that will help you take advantage of the opportunities for Airbnb hosts coming in 2021.
1. Seek and see opportunities
A lot of people are happy 2020 is behind us, but I think there is a blessing in every situation.
One of Steven's Airbnb's was shut down due to a ban. Did it suck? Yeah. But Steven considered new ideas like corporate housing, which could actually earn more profit for him in the long run.
You never know what opportunity is waiting on the other side of ‘bad news', but you're a lot more likely to find it if you keep looking!
Consider joining an Airbnb Community or local group, you'll find other hosts that can support you.
2. Get comfortable with making difficult decisions
One of my favorite quotes is “Smooth seas don't make strong sailors”.
If you're running an Airbnb business right now, you've probably had to make some hard decisions over the last few months. Our second tip is to stay the course, even when the seas are rough.
Embrace everything that comes at you, even the challenges, and you'll experience amazing growth. This year, many hosts had to cut out units or downsize their teams.
When you've got a unit that's sucking you dry, it's time to let it go. If you're just starting your Airbnb business in 2021, don't focus solely on the number of units. Say no to the units or team members that aren't helping the business grow.
3. Never name the price first
Negotiating is a hard skill to learn, but it's important if you want to run an Airbnb business.
Whether you're a cohost or host, have to get comfortable negotiating fees that come along with running a unit. This year, Steven learned not to jump the gun when it comes to deciding on cohosting payouts.
Steven was meeting with the Property Manager at one of his units, and she asked how much he charges to run units. Off the top of his head, he said 15%. The average cohost charges around 20%-30%, so it's not surprising that she asked if that was all!
First, you should do your homework on what other people are charging. After that, figure out what you're comfortable charging to cover your costs and make a profit. Once you've got your basic numbers, and you're talking to a prospective customer, focus on the value you can provide.
Consider things like the client's budget, your operating costs, and the level of support needed to get the job done.
4. Band together to prevent bans
In 2021, becoming an advocate is one of the best things you can do for your Airbnb business. Joining or starting a group of local hosts can give you a voice in your city.
There are a growing number of cities trying to add restrictions on Airbnb and short term rentals.
As a company, Airbnb generally leaves it up to the hosts in the city to be the voice. This is not a bad thing, and it's generally because members of the city council are more likely to listen to actual members of the community that are making a living with their Airbnb business.
Check out what David Krauss is doing at Rent Responsibly to learn more about boosting your voice in the community.
5.Carefully consider the units/guests you service
This year, Steven started managing a few units at a complex in Dallas. The units came with a management company, and at first, he was excited about the idea. Now, one of his biggest lessons of the year is to avoid renting out a spot that’s already got a management company.
If the management company doesn't have a good team, you can’t fire them.
Over a holiday weekend, the management company at Steven's unit had the booking calendar blocked off. When he asked about it, the management company wasn't sure what happened. He was trusting 100%, and there was a lot of friction at first.
I've had similar situations with management companies. I think it's important to weigh the pros and cons, and figure out what works best for your company. The same goes for guests and acquiring new units, don't say yes to everything if it's not a good fit.
Work on your Airbnb business, not in it.
If you can find someone that is 80% as good as you are, you've got 180% of you!
Steven wanted to add more units this year. His friend Mike mentioned he could find him more units in the past, but he never jumped on the offer. Once he realized how many units he needed to grow his Airbnb business to 50 units in a year, Steven knew he had to start getting help.
He pays a fee for every unit that Mike brings him, but all he has to do is sign a lease. There's no searching for units or negotiating prices, which Steven admits he's not a pro at. Bringing in outside help allows you to focus on what you're good at, so you can scale your Airbnb business.
7. Set measurable goals
On a recent episode of Live Let Thrive, Steven was asked how many units he wants in 2021.
He wasn't sure at first, but he knew he wanted to grow his Airbnb business. After a second, he decided his goal for 2021 is to scale to 50 units.
If you don’t have a number, you’re not going to do it. For example, the goal of acquiring 50 units can be broken down into a monthly goal of 4 units over 12 months. Once you know the pace needed, you can set up small milestones to stay on track.
Setting specific goals gives you a roadmap and terms to know when you've met your goal.It's also helpful to find resources that help you achieve your goals. In 2010 when I quit my job to start my own business, I listened to a podcast about a guy who had just done the same thing. I had to make the same decisions as him, and it was helpful to learn with him.
I've added a ton of systems to my life in the past 10 years. Yes, it takes a while to set them up, but it's worth it. Having a clear system for tracking my goals has been a game-changer.
8. Build a solid foundation
A lot of people dive in all the way when starting a business. If you have a full-time job and you’re trying to start an Airbnb business, you're forced to outsource and build a team from the start.
For instance, if you don't have the time to clean, you'll have to hire a cleaner. Don't look at this as a negative. Starting out with a team when you only have a few units will help you scale when you have 10 or 15.
These don't have to be full-time employees when you're just starting out. You can hire a friend or family member to do the basic tasks in the beginning.
The extra effort involved in setting up your foundation makes things run smoothly as you grow.
9.Hold yourself accountable
Writing down your goals is a good step, but telling the world is even better.
On our last call in the Short Term Rental Profit Academy, we talked about goal setting. Making goals specific, not just ‘increase profits’, is how you get results.
Steven is joining STRPA, and we're super excited to help him grow his Airbnb business. A community working together to achieve the same goal is a powerful thing!
If you're looking for help scaling or starting an Airbnb business in 2021, start building a community around you.
Biggest Takeaway for 2021?
A lot of really smart people handicap themselves. They focus too much on why the plan will fail and see all the flaws.
All you have to do is put your plan in place and start.
Send a message if you need help reaching your goals in 2021, I'm always happy to help a host in need!