The Hidden Costs of Poor Customer Service in Multifamily Utility Management

In property management, the importance of exemplary customer service often takes a backseat to other pressing concerns. However, when it comes to utility billing and energy management in multifamily, poor customer service can have far-reaching and costly consequences. As a property management company, understanding these hidden costs is crucial for maintaining a competitive edge and ensuring long-term success.

The Ripple Effect of Dissatisfaction

When utility billing and energy management providers fail to deliver satisfactory customer service, the impact extends far beyond a single frustrated phone call. Property managers, who rely on these services to maintain efficient operations, find themselves caught in a web of complications that can severely affect their bottom line.

1. Time Drain: Poor customer service often results in prolonged issue resolution times. Property managers spend countless hours on the phone, writing emails, or troubleshooting problems that should be handled swiftly by the service provider. This time could be better spent on core business activities, such as tenant retention or property improvements.
2. Resident Dissatisfaction: Inaccurate billing or unresolved energy management issues directly affect residents. When problems persist due to inadequate customer support, resident satisfaction plummets. This dissatisfaction can lead to increased turnover rates, negative reviews, and difficulty attracting new residents.  – all of which have significant financial implications.
3. Operational Inefficiencies: Unreliable customer service can result in delayed or inaccurate utility readings, improper energy management, and billing errors. These inefficiencies not only create additional work for property management staff but can also lead to revenue loss through undercharging or increased utility costs due to unaddressed energy waste.
4. Reputational Damage: In the age of social media and online reviews, word spreads quickly. Poor experiences with utility billing and energy management can tarnish a property’s reputation, making it challenging to maintain high occupancy rates and attract quality residents.
5. Legal and Compliance Risks: Inadequate customer service in utility billing can sometimes lead to compliance issues. If billing discrepancies are not addressed promptly and accurately, property management companies may face legal challenges from regulatory bodies.

The Compounding Financial Impact

The true cost of subpar customer service in utility and energy management extends far beyond the immediate frustrations. Let’s break down the potential financial impact:

• Lost Productivity: If property managers spend an extra 5 hours per week dealing with utility and energy issues due to poor customer service, that’s 260 hours per year. At an average salary of $50 per hour, this equates to $13,000 in lost productivity annually – per property manager.
• Increased Resident Turnover: A mere 5% increase in resident turnover due to dissatisfaction with utility management can result in thousands of dollars in lost rent and increased marketing costs to fill vacancies.
• Energy Waste: Unresolved energy management issues due to poor customer support can lead to a 10-15% increase in energy costs, significantly impacting the property’s operating expenses.
• Opportunity Cost: The time and resources spent dealing with inadequate service providers represent missed opportunities for growth, property improvements, and strategic planning.

Investing in Quality Service

Given these hidden costs, it’s clear that investing in partnerships with utility billing and energy management providers who prioritize customer service is not just a matter of convenience – it’s a strategic business decision. Quality customer service in this sector translates to:

• Swift issue resolution, minimizing disruptions to property operations
• Accurate and timely billing, enhancing resident satisfaction and trust
• Proactive energy management, reducing costs, and improving sustainability
• Freeing up property management resources to focus on core business activities

The true cost of poor customer service in B2B relationships within the multifamily utility and energy management sector far exceeds the visible frustrations. It seeps into every aspect of property management, affecting operational efficiency, resident satisfaction, and ultimately, the financial health of the property. By recognizing these hidden costs and prioritizing partnerships with service providers who excel in customer support, property management companies can safeguard their investments, enhance tenant experiences, and position themselves for long-term success in an increasingly competitive market.

Experiencing poor customer service?  Reach out to us at BANYAN Utility!

About BANYAN 

BANYAN founded in 2007, is a leader in utility expense management and resident billing services. We are dedicated to providing a sustainable and cost-effective environment through awareness and conservation to help you increase your NOI and achieve your green energy initiatives. Our focus is providing customized utility solutions for our clients and their portfolio of communities in the US and Canada. Our innovative solutions include property management software integration, resident payment processing, in-house collections department, utility expense management, vacant cost recovery, regulatory support and submeter consulting. BANYAN has been on the Inc. 5000 list of fastest growing companies six times, including 2019.