The following is a guest post by James Burrows, CEO and founder of Rentals United.
When the needs of shareholders and investors are replaced with those of customers & staff.
It’s not even close to being post-pandemic but I thought it would be a good exercise to look back over the past few months and reflect on what I’ve learnt and how Rentals United has evolved.
One thing I can honestly say is that whilst it hasn’t been easy, I’ve strangely enjoyed it. Challenges like this hopefully come around only once in a lifetime and I have a lot of sympathy for the impact the crisis has had on companies. The list of casualties has been long, the impact has been deep and unfortunately, I don’t think we’ve seen the last of it. However, after all of this, it’s never been a more educational time to be the CEO of Rentals United.
From the get-go, we altered our focus immediately. Revenue took a back seat and the KPIs we’ve been carefully developing and nurturing for such a long time were elbowed aside for some more short-term metrics. We were in damage limitation mode; our customers needed our help. Cash was king so our attention immediately reverted to daily cash-flow. This way we could create a plan to financially support our customers.
Nothing else can or should distract you. Whilst committed to a business which includes investors and shareholders, they had to take a back seat. Sure there were board discussions and updates, and an AGM was held but our customers, staff equilibrium and financial stability were the priority. The need to calm everyone and steer the ship through stormy waters were paramount.
As a CEO, you need to be stoic and in control. Communication is key. Making sure that all messages are sent out and not sprinkled with optimism. Fairy dust is good for Christmas but this was a time for clear, concise and transparent messaging. Delivering the truth is the best way to manage expectations for both staff and customers. Transparency is a critical brand value for Rentals United that we have espoused to our clients, and now more than ever transparency and clear communication is a high priority for the company internally.
What will positively impact us in the future is that we made the decision to save everyone’s job. No one in Rentals United was going to be let go. It was no fault of their own and our clients would need their support as much as possible. The workload increased dramatically. Our bookings dried up, cancellations went through the roof and revenue dropped substantially but there was still so much work to be done. This move galvanised staff commitment and I saw a focus in everyone that made me very proud. Making this decision also meant that we were going to be ready when the glint of an opportunity arose.
Big changes bring new opportunities and we could see market needs requiring adaptation to new and different consumer segments. Rather than focus on the dire state of the market, we used the data we were seeing to the advantage of our customers. The plan was to make our customers understand that there were opportunities and show them how to prepare their business to be ready for the market rebound.
So plans afoot, our account managers drove forwards to help their clients fight the many battles they were encountering. They offered them discounts, free periods and whatever other support we could muster. Internally, it’s definitely been the most difficult for our account managers. The emotional ride has been tough but they dealt with it like the skilled professionals they are.
So one very important takeaway from all this is that we can’t run a modern company using traditional business practices. Rentals United, whilst maintaining two offices, will become a fully remote business for those people who want to lead a slightly alternative lifestyle. The choice will be theirs. Our response during lock-down has proved productivity isn’t linked to office time. It has had a profound impact on everyone. A can-do attitude coupled with flexibility can be very effective and I want to see more of this.
The second takeaway is that apart from 2020, we’re a high-growth business with over 90% growth YoY but unlike others, we’ve continued to practice sustainability in our growth. Our 2020 goal was to be cash-flow positive and without having big cash reserves, this strategy has put us in good stead. I don’t care how other companies grow, I want Rentals United to be a healthy company that grows within its means. Whilst achieving the best return for our shareholders, this shouldn’t be exchanged for a “gung ho” approach at any expense. Cash management has been and will be key to our future. Whilst COVID-19 has put us back 12 months, the plan for financial stability hasn’t changed.
Alongside this will be our ability to predict movements in the market, so business agility and the ability to respond quickly will always be part of our make-up. We are a data-driven company and at the peak of the crisis, the data really helped us determine the trends happening in the market which then enabled us to respond to our clients. For instance, we put aside lead marketing generation goals, and helped our clients with genuinely helpful, actionable content in the form of webinars, blog posts, ebooks. This experience has allowed us to look at our data and act immediately and accordingly in a timely manner
The convergence between property types as well as short-, mid- and long-term stays will only force property managers to be more creative in maintaining their occupancy levels. Maximising yield should be key but so should introducing risk management to their business, if they haven’t already done it. The crisis has shown that relying on a few channels to bring in bookings is detrimental. Property managers should start looking at new markets, customer segments, product types and lengths of stay. For example, we’ve seen a big increase in mid- to long-term bookings and we believe these fundamental changes in the way we travel will have a deep impact on the traditional short-term rental manager.
So do we have any new ideas coming out of the pandemic? One thing that’s obvious is that the rental space is going to get more crowded. Hotels and other multi-unit inventory are moving into the short-term rental space whilst some vacation rental players operate more like hoteliers. There’s much each segment can teach each other which is something we will celebrate at The Trip Circus conference in June 2021. Our goals will be to continue to provide the best product and connections for our customers that will help them diversify their distribution and make their business models more resilient.
Here’s to continued learnings! Upwards and onwards!