the idea that la can be managed better by a management company is probably true -- in the
absense of the bod's ability to hire a qualified manager, their inability to trust a manger to run la, in their inability not to inject themselves into the management of la --this is an option
BUT
there are problems with this idea and in managing these type of contracts
- creeping costs -- remember the contractor's purpose is to make money -- so they will more professionally manage your business and attain savings and efficiencies but they will also have a strong desire to move any savings they accomplish into their side of the column-- resulting in them making more money and you (meaning the members) will not get any financial benefit from this arrangement-- they do this by offering you the minimum contract services with a great price (a deal you can't refuse) or known in the business as low bid--- but----
- then when you realize you want better service or more service they then renegotiate the costs for their service -- each negotiation results in costing you more money and you losing more of the savings they accomplished
- they provide minimum management services -- no more than they have to to keep the contract -- if you want more -- renegotiate for more money
- their selection of managers does not guarantee you a qualified manager -- you may very well end up with one with no more experience than any you had in the past or that you can choose yourself--- they don't send their best and most costly manager to a job that is low bid and minimum profit margins--- want better -- you must renegotiate for more costs
- if you don't have a set of lake adventure specifications covering every aspect of running la: from personnel management, facilities management, office management, property owner relationship management, infrastructure management, employee compensation and human resources management, payroll management, accounts receivables and payables, management of mandatory government documentation, payment schedules, fee schedules and compliance record keeping and etc. and etc.--- missed something in your original contract??? -- you can renegotiate for more costs
i've spent that last 21 years of my career at air products and chemicals handling $ 5,000,000.00 a year in contract services -- believe me i saw it all and i don't think the la board realizes how the service contractors work and don't realize that without strong oversight you will not realize any savings for the members and you will not be satisfied with their services-- remember they work to make money -- not manage your property -- if you pay enough (believe me that amount is never known) you may get something -- any better than you can do on your own??? you have to decide!!!!! OH NO! MR. BILL ! DECISIONS
The other side of the coin is companies don't stay in business by ripping off their customers. Appletree isn't a multibillion dollar corporation, it's a local Pocono business whose customers are local Pocono resort communities. I'd be surprised if over 20 communities would continue to use them if they were not getting their money's worth. My experience with outsourcing (Fortune 10 company) has been proven personnel are assigned to start up projects to insure success and the success is then used in marketing campaigns. The outsourcer has a pool of experienced people to pull from and by servicing multiple area communities they would be familiar with managing our type of facility and the problems that go along with it. I think Eagle Lake (via our attorney) could be convinced to share their contract negotiation experiences and Appletree may even refer us to some of their other clients for help in drawing up a contract. If not then they are not reputible and we should stay away. It wouldn't cost anything but time for the BOD to do some research and ask a few questions.
ReplyDelete