Airbnb Hosting: 3 Simple Ways to Reduce Expenses in 2018!
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Airbnb Hosting: 3 Simple Ways to Reduce Expenses in 2018!


Hello my YouTube friends its Richard
founder of STRU and Airbnb super host today’s video is
going to help you really be more profitable but instead of focusing on
revenue which is like ninety percent of what we talked about on this channel and
in every forum we’re gonna do the opposite and we’re gonna do something
that you can actually control yourself so we’re gonna talk about three things
you can do to lower your expenses and boost your profitability so a good
business practice is to renegotiate all of your vendors in all your contracts
like annually review them just because it’s been set in the past doesn’t mean
that prices go down a lot of things prices go up but the beautiful thing is
commodities tend to go down so I pick a time generally during slow season which
start of the Year January’s a slow season for me it’s a good time for me to
do all this and then it gives me the whole run rate for the rest of the year
so what I do is I call all of my different utility companies and I tell
them hey you know I’m looking at my bills this is a business I need to cut
some costs I might have to cancel altogether or whatever we use the
service whatever it is that you need to do and just get their take most of the
time they have an incentive program to keep people in fact most of these
utility companies have like a customer retention division and they may actually
transfer you to a different division and that division all they do is renegotiate
deals with people that are cutting so you have to call up and threaten to quit
in order to get to that division and then they probably have like a just like
you got a promotion when you signed up if you sign up for 12 months will give
you this deal many cases once you’re at the right division speaking to the right
person they have a retention package and so to keep you for 12 months they’ll
sweeten the deal this way and they’ll lower the cost that way and that’s all
profits ok guys listen Charles just listened like we stopped and then he
told me his story so come over here and I know that you don’t really want to
like do this but go ahead yeah it’s okay here my cup alright so what did you just
do so the deal was I switched from Time Warner Cable to fires and what they
forgot to mention to me was they added on like $35 in fees every month so I
called him up I threatened to quit I hadn’t heard that from you but that’s
what I did I was like I think I’m just gonna go back to Time Warner Cable and
just like that they knocked off 30 to 35 dollars and now I only paid ninety five
dollars a month for cable and high-speed Internet
blazing fast in blazing fast like five hundred up five hundred down
so so one for 35 bucks in the month yeah I mean they just instantly took that off
it wasn’t even a question to them they were like yeah I can take it off boom do
it don’t listen to me listen to this good-looking guy
so look speaking of cable here’s a good time to talk about cable is a dying
technology it’s used less and less by fewer and fewer people I’m not telling
you that you should cancel cable I still have cable in every one of my
homes and there’s one reason I’m addicted to CNBC so like when I stay at
a hotel I ask if they have CNBC but I’m the exception
I’m not the rule I’m that old dinosaur that actually really cares so don’t
cater to me cater to your people if you have a great place and it’s filled with
younger people or Millennials or camping or outdoor stuff and people are never
watching cable that’s like a hundred plus dollars per month that you can
easily say that’s $1,200 you do that for ten years that’s twelve thousand dollars
and plus all the investments that you’re making on top of it so don’t just like
set it and forget it take a look at what your monthly expenses are you have
everything in the bookkeeping solution whether it’s quicken or zero or you do
it in your own spreadsheet decide whether to keep it or kill it or
renegotiate it so the third and final one is like really where I started I
want to set the record straight I want you to take a look at every single
amenity that you offer from like the wine to the cheese to the robes doesn’t
matter what it is everything that you put into your place I want you to just
take a look at it with a fine-tooth comb and assess how critical it is and
whether you could save some money there or not
now if you have a really killer space and it’s $1,000 a night and you can
leave a bottle of wine that’s like in your cost of goods it’s not really going
to matter and people might expect it at that price point but if you’re doing
something like shared room and fifty dollars a night
obviously you can’t afford to leave a $5 or $10 bottle of wine and you might say
well I leave $2 whatever it is at Trader Joe’s like to buck chuck okay that’s
better your expenses are down but maybe it’s inappropriate altogether and so
what I want you to do is take a look at all of your recurring expenses from the
gifts and the hospitality and the amenities and all the stuff that you put
out the Welcome basket and see what the true costs are and so we rift on this in
the Facebook group and I think it was actually pretty helpful to a lot of
people like for me this is the way my brain thinks it was evident that a lot
of people don’t have that same sort of like
mindset or exposure so let’s talk about it the example that we were going on in
the Facebook group was about rope somebody went to Costco they have a hot
tub they bought six robes and they were saying was only fifteen dollars that’s
great that’s the purchase cost the recurring cost is what might kill you if
you don’t either charge the right cleaning fee increase your cleaning fee
or you just like absorb the cost of you don’t think about any of these things so
let’s talk about the cost of these robes on a recurring basis the obvious one is
six robes are gonna take an entire washer and annan try or dryer so there’s
a whole extra load okay so what’s involved in an extra load more
detergent more softener more electricity more gas how about this wear and tear on
the appliance and appliance has a useful lifespan maybe it’s a thousand washes or
10,000 washes if you’re doing one additional wash after every single
turnover your washer and dryer are gonna last lower so there’s a cost to that how
about the supplies detergent fabric softener they’re not free you have to
add a cost to that oh and how do you get them you drive to Target or Walmart okay
there’s a cost to that there’s the wear and tear on your car there’s the time
that it takes you to take to get there so like these are all these hidden costs
that people just don’t necessarily think about and I’m not saying you have to
think about them again if you love doing it and it’s baked in and you’ve got a
right cleaning fee and so on like then go ahead and do it but if you haven’t
thought about it or you haven’t increased your cleaning fee and you’re
just like saying I’m doing this now isn’t this great it’s gonna get me more
revenue more bookings no it’s actually not gonna get you any more of that all
it’s gonna get you more of is expenses so if you’re gonna do all that and you
haven’t increased your cleaning fee maybe bump it up five or ten bucks you
know per turnover and that might cover it and then you have the robes and the
hospitality component and they’re paying for it not you so that’s my point just
take a look at everything that you do think about all of the different hidden
expenses make sure you value your time your time is not at zero every single
thing that you do for this business or anything else put a price tag on your
head and I would say if it’s not 15 or 20 dollars an hour you’re way under
estimating your price you probably worth a lot more than that and
if it’s not worth you are doing then outsource that to in closing recognize
this we spend 90% of our time thinking about revenue and the reality of it is
there’s not much we can do about it when we list on platforms like Airbnb and
home away and so on and so forth they have their own algorithms they sometimes
put new people at the top of the list and super hosts at the bottom and
sometimes they mix it up so like there’s not much you can do there we want to
have the best listing possible but focusing on revenue is not something
that we can actually control expenses however are entirely in our control
nobody is forcing us to spend a cent so if we spend a lot enough time and energy
thinking about our costs and our expenses that’s how we can improve our
profitability and since we’re all doing this for the long term and to reach our
why again that why for me is my 15 year plan I have the best chance of getting
to my 15 year plan by minimizing my expenses and knowing what they are and
tracking them using bookkeeping software and so on so that I get to my why I hope
you found this video helpful I’d love to hear what you do what expenses you cut
please go ahead and comment below because again we’re a great community
and the more we share the more we learn I’m just one guy
you guys are thousands with lots of experience and lots of great advice so
tell us how you save money what expenses should we minimize let us follow you
we’d really appreciate it we’re grateful and with that I’m gonna ask you kindly
to please subscribe to the channel

21 Comments

  • Cl Reed

    I cut cable 6 months ago from the triple package to just high internet – less time on the tube, more time on the making the legacy dream come alive ($137.00 a month now down to $40.00 month). I also review, analyze and renegotiate cell, utilities, services, insurances, etc. every quarter! It may not be much, but at the end of the day – it all adds up…

  • Lee Hunter

    I have installed Nest thermostats to my apartments. It allows me to turn off the heating when a guest leaves and to warm the place up when the next it due.

  • Mark Welpman

    Just this last month I installed Ooma and did away with my landline phone service. Ooma is a VOIP like Vonage. The difference is there is no monthly service fee. Buy the machine for around $60, hook it up to your modem and that’s it. Yes you have to set up an account. My cable, telephone and internet was costing me around $160 a month. Now my total bill. Is around $62. Free calls to anywhere in the US, Canada and Mexico. You can pay for the premium plan and have unlimited call to most countries in the world. I recommend looking into Ooma. We bought ours on Amazon. I have to say, I was skeptical about Ooma, but we’re really happy with the service so far. We have Ooma at home and in our Airbnb. Total saving is about $135 a month. $1600 a year saving is not bad for taking a different approach to a problem. $1600 saving looks a lot like $1600 in earnings.

    Happy Savings,

    Mark W.

  • kathleen zamsky

    It someone left 2 buck Chuck for me they would not get a 5 star review. That stuff is awful. Nice water would be much better.
    I shop at the Goodwill for coffee mugs, and miscellaneous kitchen items. I have also found some cute things to decorate with.

  • Bridget Benedetti

    I actually went to the "cable store" and told them that I wanted to reduce expenses. Without even looking up my account, the customer service rep told me he could cut $30 per month for me. You have to ask! After that, he worked with me and saved a total of $50 per month for my internet/cable package. Of course it had creeped up over the years, but I was happy.

    Great comments about the value of our time also.

  • ANGEL FINANCE GROUP

    Richard, I just discovered your channel and I am so grateful for the value you provide for us. I started a year ago renting my home in London and I found it challenging initially but I'm going to implement your guidelines and let it work for me. Thanks so much!

  • ying yang

    Furniture can be expensive, buy used high-quality brand name furniture and decor. its a hobby of mind. if you pick well you can sell for the same price or even get some profit from it.

  • Terany Nicole

    I found a listing that is perfect for our situation BUT I can’t afford quit the price nightly the host has it listed as. I’m new at this but wanted to ask if most host consider lowering rate if guest is planning to book for longer than normal stay? If so how do I go about asking?

  • mskeishapac

    Thank you, im watching this in 2019 im looking to do this in 2020 inmy house which i have 2 bedrooms with 2 bathrooms

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