Mike Bayer

You're listening to the Vacation Rental Success Podcast brought to you by the Vacation Rental Formula Business School. Are you ready to take your vacation rental business to the next level? Invest in the knowledge and training you need to get there. With the Vacation Rental Formula Business School, you can gain access to an exclusive course library that covers topics like marketing, pricing, strategies, operations, and more. Become one of our founding members today and get exclusive access to all additional content produced in the years to come. Whether you're just starting out or want to expand your existing business, you'll learn invaluable lessons from the top industry experts. So don't wait any longer. Secure your spot today at vacationrentalformula.com/bizschool and start your journey to success. Are you ready for today's podcast? Let's get started. Here's your host, Heather Bayer.

Heather Bayer

If you're a regular listener to this podcast, you know I love to talk to property managers who've grown their businesses, sometimes from the ground up and sometimes to a new level of success. Today I'm talking to Caleb Hannon from Stay Lake Norman, a luxury brand in North Carolina. Caleb is sharing his secret sauce to building on an established brand with his own spin of flair and new ideas.

Heather Bayer

This is the Vacation Rental Success podcast, keeping you up to date with news, views, information, and resources on this rapidly changing short-term rental business. I'm your host, Heather Bayer and with 25 years of experience in this industry, I'm making sure you know what's hot, what's not, what's new, and what will help make your business a success.

Heather Bayer

Well, hello and welcome to another episode of the Vacation Rental Success Podcast. This is your host, Heather Bayer, and as ever, I'm super delighted to be back with you once again. Every so often, I reflect back on what happened a year ago or so much time in the past, particularly if it was a significant event. And then I can look forward to see how things have changed over the time after that event happened. And this time last year, we were sealing the deal on CottageLink Rental Management, my property management company. And if you are a regular listener, you will know that it wasn't the easiest process going through due diligence. And I talked about all of this in my episode with Justin Keller Hobson, who's the new CEO of CLRM. And Justin and his partners at Pillar 49 were completely new to the business of short-term rentals.

Heather Bayer

So it's been an absolute pleasure to see what they've done over the past nine months to continue our legacy. And they've kept our fantastic team and they've kept the great portfolio of properties. And also over that time, they've introduced loads of new systems to streamline the operations and improve procedures. They brought on additional properties, a lot of them, and taken on additional staff. And this company is now going from strength-to-strength. And it's been absolutely fantastic to be witness to what's happening. I'm still involved in a very limited way, so I get to still sit in on the Slack channels and see the emails, although that's probably not going to go on for much longer. But it's been so great to see the transition being so perfectly smooth and event-less, if you like. And I've talked to some owners who just love the new injection of ideas and motivation and just a great transition.

Heather Bayer

Then for others, the next step in their evolution is to actually buy the company that they've been working for. And this is what today's guest did with Stay Lake Norman, a luxury brand in North Carolina. So I'm not going to say any more about it.  I'm going to leave it to Caleb Hannon to tell the story. So without further ado, we'll go on over to the interview.

Heather Bayer

Well, hello. And I am so excited to have with me today, Caleb Hannon from Stay Lake Norman. I'm going to hear all about Lake Norman, where it is and what Caleb's company is. I'm really excited because I love talking to property managers. Welcome, Caleb. Thank you so much for joining me.

Caleb Hannon

Yeah, absolutely. So happy to be here, ready to answer all your questions and give any tidbits I can.

Heather Bayer

Excellent. Well, with everybody I interview, and it's regardless of whether they're a vendor in the business or they're an independent owner or property manager, I always want that origin story. How the heck did you get into this? It's really not perhaps the most exciting thing to get into at the very outset for most people. So what got you into it and what makes you so passionate about it?

Caleb Hannon

Absolutely. So there's a lot of individuals that I hear speak, and a lot of them started with their home, renting it or purchasing a small apartment or something, renting it. My story is very different from that.

Caleb Hannon

So graduated college and got into marketing. From there, I wanted to be in sports. So I started working at a college campus, working in recreational sports, and I decided that sports wasn't where I wanted to be. From there, I went into working at a nonprofit and started managing a retreat center. And that was a lot of fun and I really loved it. But COVID hit and we ended up having to shut down that retreat center and shut down the nonprofit actually as a total. I was without a job for a few months and stumbled into this company, Stay Lake Norman. They were hiring an operations manager at the time. I applied for it because I had a little bit of experience with processes and managing people, so I jumped right in with both feet.  I think I listened to your podcast on my way to my first day of work because I jumped in fully-fledged and I just realized that this industry has so many moving parts that any day you come to work, you're not going to be bored.

Caleb Hannon

So that was really, really exciting for me. And then being able to work with people on different fronts. So I got to work with my staff, but I also got to work with homeowners who are investing. And then I also got to work with guests. So every single story is just a little bit different. And I get to connect with those individuals. And so that's what keeps me going every single day is coming in and knowing that today is going to be completely different and I might be able to change the life of one person today.

Heather Bayer

So what's your role in the company right now?

Caleb Hannon

Yeah, absolutely. So after about six months with the company, the sole owner approached me and decided that he wanted to start taking a step back. And the only way he could do that is if he had someone fully vested in the company. So he gave me an opportunity to purchase part of the company. At that point, my wife and I jumped in even further, purchased part of the company, I'm currently the COO and part owner of the company as well now.

Heather Bayer

Right. So you're fully invested in it?

Caleb Hannon

I am fully invested. This is my whole retirement plan now, so I'm here for the win.

Heather Bayer

I love it when you say there's so many moving parts and every day is different. And you know that I did this for 20 years and not that I'm unhappy at being out of it after 20 years. But that was definitely something that kept me passionate about it was that one day, as you say, you'd be handling, maybe going out to visit a new owner, and then on another day you were dealing with an issue at an existing property and then maybe exploring some new software on another day. I just loved it.

Caleb Hannon

Yeah.  I mean, it's really hard when you get in a job where it's just the same repetitive thing over and over again. And there are people who can thrive at that. I believe people who thrive in the hospitality environment thrive in the opposite way of every single day is a little bit different. You really never know what you're going to be doing. And really, that combined with the people atmosphere, of being able to communicate with so many different people and touch the lives of so many different people, that's what keeps me going every single day when I drive into work.

Heather Bayer

Tell us a little bit about the company itself and the types of properties that you have in your portfolio.

Heather Bayer

Absolutely. We do have a niche when it comes to high-end luxury lakefront properties. Every single one of our properties is lakefront on Lake Norman right now. Every single one has a private dock, and about 90% to 95% of them are curated by an interior designer that professionally handles all of the design of the space. We love to get into properties from start to finish. When someone purchases a property, we come in, we step in, we walk it with an interior designer and a contractor, and we say, Hey, this is the flow of the house. These are things that we really like. These are things that we don't like. Then we start the renovation process. We actually attempt to reverse engineer the return on investment. If a homeowner calls us and they say, Hey, I have this amount of investment capital I can put in. I really need to see a 7-8% return, then we can take that and say, Okay, then this property needs to gross X. In order to gross X in this market, you're going to need to sleep this many roughly, and you're going to need to have these additional amenities, whether that be a beach or a heated pool or an indoor games room or guest suite.

Caleb Hannon

Then we can go into what does it look like to build that? Or what does it look like to renovate into that? That's how we really try to curate. We're responsible for the investment, and our goal is to get the return that's needed in most cases on average. That's how we handle it. High-end luxury lakefront properties is our niche. If you want to segment that even further, you're going $16K plus with a heated pool, and that's where we really excel.

Heather Bayer

That sounds fantastic. I've looked at the website and drooled over a number of the properties on there. So let's just explore this a bit about the owners. You're clearly particular about the types of properties that come into the portfolio. What about the owners themselves? Are they all amenable to you coming in and doing these renovations to their properties, or do you take on some that are wanting to keep it as it is or do their own thing or have a greater involvement in it?

Caleb Hannon

That's a great question. So ideally it's hands-off from the owner. It's really looking at it as an investment, of saying, I'm going to put my money in and we trust you to make these decisions and make this property return what it needs to. With that said, there's always an emotional side to putting money into real estate, and we get that, we understand. So a lot of our homeowners do work with the interior designer and say, Okay, I wish it would have…. maybe these are some colors I really like. But recognizing this is a professional interior designer and they do this for a living and look at all of our other properties and you've fallen in love with them because we've allowed interior designer to make those decisions. So we do have people that are a little more hands-on.

Caleb Hannon

We do have people who just say, Here's my money, play and get me the best return. Yeah, we love those people. But when it comes to someone who just has a property that is like, This is my property. This is what it needs to be. We'd like to rent it. Those individuals, while there might be a market for that, we won't accept those individuals into our portfolio.  And we take that very seriously. And we have many conversations with them explaining, This is how we operate. This is why we can do what we do. If you don't want to fit into that mold, it's fine. It's our decision, just recognize we can't work together.

Heather Bayer

That's a really interesting perspective.  I talked to Tyann Marcink from Branson Family Retreats fairly recently, and she's growing.  Although she manages her own very, very large properties, which she builds and markets,  she's since been taking on some new properties in the property manager process. One of the most interesting things she said on that episode was that there are certain things which are non-negotiable with owners. And it sounds like you're operating a very similar policy, which is a wonderful thing to be able to do. I know that in my company, we weren't able to do that. We didn't have that. I think you do it in that particular niche that you're in, and it's a little bit more difficult in others. I would have loved to have had that luxury of saying, If you don't toe the line, you're not coming in the club. But I love that idea that you can do that because then you are in complete control of standards and quality and ensuring that what your guests experience, is exactly what you tailor for them.

Caleb Hannon

I would totally understand where you're coming from. In certain markets, it may not be able to do that. In larger competitive markets, Lake Norman, North Carolina, isn't this nationally searched location where everybody wants to go. And so we already know that when it comes to travel, we even have a niche and people looking specifically for Lake Norman, so our market isn't booming. We don't have hundreds of thousands of units for rent, maybe in a Miami market, or something like that. So we do understand that, and don't get me wrong, every single day we question our niche and we say, hey, we've got this property, it's pretty cool. And we say, can we do it? Well, yes, we can. The question is, are we willing to adjust our operation just to get another house in it, or do we need to continue to be the most efficient we can in our operation so that we can be the best stewards of not only our income and our money, but also our homeowners income.

Heather Bayer

When you're talking to owners, owners that are amenable to the conditions that you're placing on them, what do you tell them that they need to stand out in the market and for your target market?

Caleb Hannon

Great question. The first thing that we really push on them is making sure that the property is designed to curate connection, curate people coming together, and an ability to feel like you're in a place that's overwhelmingly satisfying. So what we want is, I want you to walk into the property as a guest and, like you said, drool a little bit and say, Hey, this is exactly what I need. This is exactly what I wanted. I can look at that lake. I can look at these rooms and I can just feel relaxed. And so that's what we aim to curate. A lot of that comes from picking the right colors, making sure that the living room has the right spacing of furniture. That's what our interior designers are so great at is being able to say, The flow of this room and the flow of this space needs to be X, Y, Z. And so that's the first step. The second step is making sure that there's a great relationship and understanding that we are a hands-off operating company when it comes to the investor. So the homeowner doesn't have to do anything. We have a large group of them that we communicate, and this is not the norm, but we communicate maybe four times a year, every quarter, and just say, Hey, everything's great.  Property is doing great. At the end of the year, Here are some updates that need to happen and we can take care of that for you. We have some that we communicate with monthly, but it is very much a hands-off approach from the owner's perspective. This is my investment, once again, that's how we approach it. Then the last thing that we don't budge on whatsoever is safety. If there's a safety concern at a property that's marked right away, and if the homeowner is not willing to budge, we have threatened to cancel contracts on safety. And so that's the third step that we really push.

Heather Bayer

Yes, that sounds like you're talking straight from the Justin Ford playbook there.

Caleb Hannon

Oh, yeah. Justin and I have become very very good friends professionally and personally. And so he has definitely helped me and trained me and taught me a lot. And I've brought that to our homeowners. And it's a step above that a lot of people don't do. And so we want to separate ourselves in that aspect.

Heather Bayer

And I think that's a very laudable pursuit in doing that. And I think having been a property manager and seen properties of perhaps lesser quality come to us where they've been rented out for years with some just monumentally scary safety issues. And us going in there and saying, we can't rent this. We can't have a bedroom in a lower floor with no windows. And we can't have those bunk beds because you want to pile people in. We can't have the bunk beds pushed up against windows. So, yes been there.

Caleb Hannon

Yes, it's so scary. And I have kids. And so when I jump into a property and I walk it right away, that's the first thought that goes to my mind is, okay, would I allow my three year old to stay in this property? And would I feel comfortable walking into this property, knowing anything about it, and ensuring that as a parent, I'm able to relax and let my kids play? And so that's something I take very, very seriously. And it's something that my wife takes serious now. And she calls me when she goes and travels and says, Hey, I tested the smoke alarm. It works. I'm like, Okay, good. Thanks.

Heather Bayer

Yeah, I think that's why everybody should do that when they walk into a rental home or even a hotel. Test the smoke alarm. You've talked about the flow of a property and creating a space that your guests are going to love. It sounds like you have a very clear handle on your target market and the avatar of your guests. Can you go into that a little bit?

Caleb Hannon

Perfect. I would love to. Really, we have two different markets here because we have a high seasonality, recognizing that. Our first big target that goes across the whole scope of our branding is targeting the top 10% of income earners. We do have higher ADRs than the average here, and so we have to be sure that we are targeting the right guest. With that in the peak summertime, really what we're targeting is groups of people. So whether that be three or four couples, whether that be 10 guys coming together for a golf trip, maybe it might be two or three families coming together. But really, it makes most sense when multiple groups come together and they rent these larger properties because it does make more financial sense. With that said, we 100% have families of four or even couples who rent out some of our largest homes, and they just have the income and they're in the top 1% of income earners, and really, they don't ask for price. They just say, Hey, we want the property. Where is it? Perfect. Here's my card. And then they're ready to stay with us for a week.

Caleb Hannon

In the off season or the shoulder season, we start targeting even closer drive to markets. And so we're looking at the big cities right around. We're looking for people just a weekend away or things along those lines. So first is going to be that income and the second is going to be really targeting groups of individuals who want to come together and be connected.

Heather Bayer

Yeah, sounds great. So just continuing on this marketing theme, how do you target them? I'm assuming that you're not 100% on Airbnb.

Caleb Hannon

No, absolutely not. So we are 65% direct when it comes to our bookings. We actually de-listed from Airbnb for a while. We've since reinvested in Airbnb, once they created their Luxe platform. We have posted a lot of our properties on their Luxe platform. But ultimately, as you teach and as so many professionals and leaders in the space teach, direct booking is the way to go. So the way we do that is one, we aim to make no matter who you are, where you're coming from, or how you've booked or found us, the goal is that we treat you the absolute same. And so if you can realize that and see that, then it makes a level of comfort with Stay Lake Norman. I don't care who you are. I don't care what your background is, but I want you to feel like a Stay Lake Norman guest. And so that's first and foremost. The second thing is just creating this welcome atmosphere when it comes to communication. Our website, our emails, we want everything to be very seamless. And so making sure people understand Stay Lake Norman, Stay Lake Norman, Stay Lake Norman, no matter where they book from, they're going to provide a great experience for me.

Caleb Hannon

So then it just goes into everything we do, making people feel connected. So if that's going on to our website, learning a little bit about us, or going to our website, and every page you go to, you're going to see a picture of people in a space that we've curated, feeling connected so that not only do they see the sense of connecting themselves with each other and their friends and family, but also giving that sense of connected to Stay Lake Norman.

Heather Bayer

That's great. I'm assuming once they come in from a major platform, you're re-targeting them to book direct the next time?

Caleb Hannon

100%. This is going to go, whether it's text messages or phone calls or email marketing, every single thing that we communicate with them, we are saying the words Stay Lake Norman, so that they understand that. So we speak to every single guest on the phone before they're allowed to stay in our properties. And the first thing we do when they pick up the phone, this is Caleb from Stay Lake Norman. And then we end the conversation with, what can we do to make your stay even better? And we ask them that question, what can we do? Everything we do is branded Stay Lake Norman. Every time they get a communication, it's Stay Lake Norman, it's book direct. Come back and stay with us next time because you'll save even more money.

Heather Bayer

Terrific. I want to talk about the partnerships that you have with other companies because like many luxury brands, you are catering for the people who don't want to… They don't always want to cook their own meals. They don't want to wash up afterwards.

Caleb Hannon

Right, absolutely.

Heather Bayer

So you have a number of partnerships with other companies, and it might be rentals or catering. It always interests me is how do you… You are creating your own brand of standard and quality. How do you ensure that quality can remain high with the third-party companies you work with? Because when you talk about moving parts, when you start bringing in third-parties, that just creates yet another level of challenge from what I can see. How do you do that?

Caleb Hannon

Very carefully. The first thing is, with our properties, we do have a sister company. My business partner owns this boat rental company. That's the number one, is that we try to gain a little bit of ownership anywhere we can. That way, we've got a little bit of say in the direction and the quality and everything because we understand the niche of luxury and what we're trying to offer. The first thing is the boat company, we have a hand in that. I oversee that company as well. And so I invested in that company, and I'm making sure that the boat rental company is matching the homes that are being provided. When it comes to the private chef and the catering and the meal delivery service that we've worked with, once again, my business partner purchased part of that company as well as myself. So we have a portion of that company under our control, and so we can understand the quality. We also use that service. So if we're doing a staff lunch, we'll purchase the food from that company, and that gives us an opportunity to, one, introduce our staff to it, but two, test the quality.

Caleb Hannon

When it comes to third-parties that we don't have a financial investment in, it comes down to, one, really building a partnership with the founders and the CEOs of those companies, and to test running them. So we'll say, Hey, we would love to offer you to our guests. We'd love to promote you. We'd love to push you. We see what you do. Can you show us? And then we'll reach out to our guests that we know use them and we'll say, Hey, do you have any feedback on that? Because we want to make sure that they're delivering an experience that's equal to what we're delivering. And we will always get, usually, it's good feedback. And so we have yet to have to cancel a partnership because we try to do our due diligence as much as possible.

Heather Bayer

It's really interesting hearing this because I heard this from my talk to Travis Wilburn from Stay Charlottesville and the 100 Collection recently. He'd seen gaps in the market in Charlottesville, and he was jumping in and just filling those gaps, either investing in existing companies or creating another one. And that, of course, when you have that control, it takes away a lot of the ‘iffy' nature. And I think that's what I was looking at when I saw the site and I saw all the different concierge services available. And I thought, oh, gosh, what happens when the chef doesn't turn up? Or if the quality is not as people would expect? So you gave such a great answer to that. And if you're wanting to offer additional stuff to your guests, then buy into the company that's delivering it.

Caleb Hannon

Absolutely. Either buy in or like I said, just create that partnership. And so that they understand what you're doing and you understand what they're doing. And the last thing I want to do is oversell. I don't want to say this company is really great, you should work with them 100%. Then the next thing you know is it's a terrible experience and now that's come back on me because I've recommended them. We do our due diligence and have no problem investing in a successful company or what we think is going to be successful.

Heather Bayer

Can I talk for a moment about housekeeping and operations and linens and how this is all managed? I know with my company, we had 160 properties and they were scattered everywhere. And it was like herding cats to ensure that the quality was maintained across different properties, a property that was 100 miles that way. And we might have been able to see a cottage on a lake across the water, but it was a 45 minute drive to get there. So what are the logistics in a nutshell of your housekeeping service?

Caleb Hannon

Yes, this is an ever evolving department and I think it will continue to be ever evolving. When I initially started, the housekeeping was fully third-party. It was 98%, housekeeping was done by one company and we allowed them to handle all the logistics of the staffing and linens and everything along those lines. As that relationship started hitting its limits, we decided to go fully in-house. So we did the complete opposite. We said, Okay, we're going to hire every single employee. We're going to manage it all in-house. We're going to train them all. And that hit its limits in the peak season because we just couldn't find staff to hire for three months and then let go. And so right now, we are about a 60/40 blend. So we keep about 40% of our claims in house with full time and staff. And then we do about 60% outsourcing with 1099 contractors. And so what we do is, it's not this is your house, this is your house, this is your house. It's you might be associated with 10 houses. And if that populates a clean, you can grab that. And it's a first come, first serve.

Caleb Hannon

So if you're busy that day, you don't have to worry about working. But if you don't have any cleans this week and you want some income, then you can pick up all the claims this week, up to you. And so building that relationship with those third party vendors as well, we meet them at the properties, we introduce ourselves, we talk through tips and tricks that we have. We try to give them pictures and things along those lines, checklists so that there's nothing missed. And then afterwards, we do an additional inspection, which is a separate department in our company. And then that person comes in and actually inspects cleanliness and amenities to make sure everything's up to par and up to standard.

Heather Bayer

What about linens? Do you have your own linen service?

Caleb Hannon

We do. A part of that initial transition to in-house housekeeping is – I'm very much a systems processes operations guy. That's what I do. That's what I love to do. I love logistics. And so, we found that it was impossible to ensure that every single property was being accounted for when it came to linens. And if something was stained, being able to, one, treat it, get it back to the right house, and then charge the owner whatever. So we ended up doing a linen buyback. We bought all the linens from the homeowners we had. We purchased additional linens in-house, and now we do a linen lease program. So for every turnover, the homeowner pays a certain amount of rental for each occupant for that lease, and then we handle all the linens in-house. Currently, we use a laundromat, which isn't ideal, but we are in the process of building our own facility. And so hopefully by December, we'll have our own commercial laundry and new office space for that.

Heather Bayer

I've talked to so many property managers recently who have gone that route. They've tried every which way to be efficient with laundry and have finally gone the, ‘let's build our own unit' route. Because, once again, it's having control, isn't it? It's having the inventory control, knowing what's coming in, what's being done, what's going out. And yes, it wouldn't have worked with my company, but it would have been lovely to have.

Caleb Hannon

Well, I'm very excited. Everybody I know that implemented a new laundry facility. It's like Christmas Day they say when everything's delivered. So I'm waiting and waiting and waiting and I'm so excited and I know my staff is excited because they are tired of going to the laundromat to wash linens.

Heather Bayer

Yeah, exactly. Okay, this is the point I ask every property manager about their tech stack. What's in your tech stack? What makes Stay Lake Norman run well, and without friction?

Caleb Hannon

As we saw from that document that was shared all over the internet of all the different tech softwares that are out there for our industry, some of my favorites we use, one is our PMS system that's Streamline. We just implemented a new software, which a lot of people already had, and everybody said we were behind the pace on, but that was Breezeway. This is brand new for us, and we just waited for the right time. It wasn't the right time previously, but now we're getting to the point where it's going to make our life a lot different. We use Wheelhouse and we just transitioned into for our pricing software, and then we use DACK for our guest enhancement app. So every one of our guests downloads the DACK mobile app and it has all of our information about the house. It has upsells, local recommendations. Those are four that I don't think we could live without now. But at the same time, we're always looking at new things. I will tell this call, whenever I want because if they give me one nugget of helpful information, that's all I need. That's the four main ones that I say we can't live without right now.

Heather Bayer

Excellent. I think that hits the nail on the head with those. You need your PMS, you need something for operations, something for the revenue management, and then everybody's gone to some form of digital guest guide now. I know just before I left my property management company, I was still going to see new properties and seeing the dog-eared and coffee- stained old welcome books. And I hate to see them now. If I go and stay at a vacation rental, I want this on my phone. I want to have this weeks and weeks before I go. So those who are not using these types of guides are really being left behind, I think. And it's time to get in there. I had not heard of DACK. I will go take a look at that….

Caleb Hannon

Definitely. Check them out. We love them.

Heather Bayer

Excellent. Well, all these will be listed in the Show Notes. Did you go to the VRMA International last year?

Caleb Hannon

I did, and the vendor ‘warehouse' if you will, was overwhelming. But I did. I thoroughly enjoyed it. And I love going to some of those bigger shows. And then I like going to the smaller ones, too, where it's a little bit more intimate and you can connect with people. But absolutely, we'll be back there this year as well.

Heather Bayer

Well, I was thinking about the last one I went to…. I have been to one since COVID, and I can't remember…. Just seems like a long ago. But I was just blown away by the exhibitor halls. And I remember 15 years ago going to a VRMA conference and there was just a smattering of vendors. And now, as you say, warehouse.

Caleb Hannon

It's just go in and pick what you want off the shelf and you're good to go.

Heather Bayer

Yeah, just everything is there. Caleb, if somebody's listening to this and thinking about getting into the property management business, what tips would you give them? If they're either starting out, or if they're just really looking to grow and get off on a new trajectory?

Caleb Hannon

Well, the first thing, and I think this goes a little bit into more of that personal life as well, is one, just know your value and hold your value. So us being in a niche and a luxury high-end niche, oftentimes our commission is a little bit higher than maybe our competition, but we understand why and we understand what our value proposition is and why we are so different. So being able to, one, recognize what your value is and then being able to stick to that and hold to that, I think will help you not only grow, but I think it will help you feel better about your growth as well. The second one is, and I tell my team this all the time is, find the best in class. So whether that be your people or your software or whatever you're using to make your business smoother, find the best in class. And if that means you have to pay a little bit more, pay a little bit more, because you'll see the dividends in the long run. And so that's what we do with everything. When we add a new software, I mean, Breezeway talked to me for two years before we signed up, because I wanted to ensure that they were the best option for us and they were going to be the best one.  And I told them no, a lot. But eventually they hit the notes that we needed, to be the best that we needed. So find the best in class and know your value.

Heather Bayer

Those are great tips and certainly coming from a property management background. I would endorse both of those. Well, it took me a long time to get around to that finding best in class. For a long time, it was find the most inexpensive. And if I was advising somebody going into the business now is ditch that way of thinking, because some of this software is pricey because it's great, because they meet the needs of really dynamic and growing property management companies. And I know from our connection with Breezeway, we didn't use the whole offering of Breezeway, but I know when we took on their text messaging service that our lives were changed overnight.

Caleb Hannon

Absolutely. What I remind my staff is when they bring something like a proposal to me, I'm like, Okay, how's this going to change the operation? How's this going to change your life? Why do we need this? And we need the why. And I say, Okay, is there another solution out there? They always know to be prepared because I'm going to ask, What are the other solutions and how can we do it? And then it's really using a cost analysis of saying, Okay, we can go with this one and it's, let's say, it's 10 times the cost, but it's going to save you 10 times the time. Okay, well, that makes sense then, because now you can use your time on other things that might be more important. So, yeah, we did the same thing. We had things that we paid less money for and we were always looking for a deal. And then we had to learn like, no, we got to pay this person a little bit more because we want them and we can't lose them, or we got to use this software because it's going to do the best for us. So been there done that.

Heather Bayer

One more question, actually. It's just come to mind. I'm thinking with the way you manage the company, you don't have a considerable amount of problems and issues when guests are in place. But I'm sure you do have them and you will have demanding guests like we all do. How do you deal with that? I'm thinking more in terms of the administrative process, recording something that's happening. Do you use some form of software to keep tabs on that and to ensure that that same situation doesn't happen again?

Caleb Hannon

That's a great question. And I think, Heather, that is part of the reason why we started moving into using Breezeway a little bit more. So the first thing that we do right now is, we do document it, we relay it to the team that might have a stake in what happened. So if if it's a maintenance issue, the person who oversees maintenance is definitely going to be CC'd in that so that they know and they can be aware. Then we're going to put that when it comes to that reservation, that person specifically, we're going to make sure we document that on their reservation, so that when they call next time, if they mention an issue or something, we can pull it up.

Caleb Hannon

And then the last thing is a lot of those types of things come in reviews. So if you ask somebody for a review, they're going to mention that small hiccup. Whether you handled it well or not well, whatever they're happy about, they're going to mention it. So I actually single-handedly write and respond to every single review that we get. And if I know that there was an issue, because I was relayed, I will mention it and say, I am so sorry about this X, Y, Z.

Caleb Hannon

Sometimes we'll offer a free early check in early check out next time they stay, or I just make sure to note that this wasn't an automated response. This was a human that actually read your note that was able to say, I hear you and X, Y, Z. And then now with Breezeway, we're able to… If it's something that needs to be repaired or noted, we're able to mark it in there so that, one, it doesn't get lost, and two, if it happens again, we have a running total of the amount of times that it happens, so then we can address it a little bit better. But that's still new. That's in beta with our company. We're still trying to get that up and running, but that's the goal for the long term.

Heather Bayer

Yes, it was always quite the task for us to… In the course of a busy summer with 160, 170 properties and maybe 150 families going in and out every week, there were always going to be issues. And that whole documentation process was something that had to be nailed, so that we documented absolutely everything, who dealt with this, who dealt with that, what maintenance was done, what the resolution was. And looking back in the earlier years, we didn't do that. And it certainly made a great deal of difference once we started a really good documentation process. So I expected that you would have that in hand. So what is the outlook for Stay Lake Norman over the next few years? What goals do you have?

Caleb Hannon

Well, the goal is to continue to be the best in class here and continue to gain national recognition for what we're doing that might be a little bit different. And the goal is to get to a certain number of properties and then evaluate our market, see if there's growth potential for more luxury homes. And if not, then settle in, stay at that number, maybe continue to refresh some of our properties, get them a little higher-end, up to par, maybe add pools here or there if we can. And then who knows? Right now, the goal is not to expand to a new location, just because there's only so much money in the world that I need and that my business partner needs. But we're driven and we always want to try something new. So really, I could see us expanding into maybe creating a niche OTA or something like that just for fun. But right now it's all hands on deck to get Stay Lake Norman to the most efficient and income-based company that's returning for our homeowners. And we have a number in mind, and I think we'll be there in two years. And then just allow ourselves some space to breathe and find out what's next.

Heather Bayer

That sounds great, Caleb. This has been such a great discussion. I just find it fascinating to talk to property managers across the country, and across the world in fact, in different markets. And it's always lovely to talk to people who are in the luxury market. I wish we'd been able to do that.

Caleb Hannon

Well, you had your own challenges and we had our own challenges.

Heather Bayer

Thank you so much for joining me. It's been an absolute pleasure. I do hope we get to meet face-to-face, perhaps in Orlando in the Fall.

Caleb Hannon

Yes, absolutely. I will be there. I may have my family dragging me to the parks, but I will be there for a little bit for sure. And thank you so much, not only for having me on, but for what you bring to the industry. Like I said, I listen to your podcast all the time and I always learn something new. And that's the only way I can keep going is by learning new. So thanks for what you bring.

Heather Bayer

I really appreciate that. Thank you so much, Caleb, for sharing your experience with us.

Heather Bayer

While we don't all have the luxury of having non-negotiable criteria in our management companies, it's always great to hear how this works to everyone's benefit. And as I mentioned, talking to Tyann Marcink a few weeks ago, she offered the same perspective on owner acquisition, which is interesting. I would have loved to have had a little bit more in the non-negotiable when I was in my property management company, but it was always a goal of ours to continue acquiring new properties. And sometimes I think maybe we fell down a little bit on making that distinction between wanting more properties in the portfolio and appreciating that there would be some that wouldn't quite fit and could perhaps cause us more problems in the long run.

Heather Bayer

And we talk a lot on this show about acquiring new properties. So I wanted to draw your attention to the course that I've written for the Vacation Rental Formula Business School on getting new owners and keeping them. And I'm going to add in a new lesson into that course called the Non-negotiables, as I think it really is an important component in creating new contracts.

Heather Bayer

You'll also find a course on owner onboarding in the Business School that I developed after 20 years of honing my skills at bringing new owners on board. And it's all about what I learned over the years, what I learned really worked and what didn't. Anyway, Mike is going to tell you a little bit more about the business school after this. So thank you so much for being here, listening in to another episode, and I look forward to being in your ear again very soon.

Mike Bayer

You've been listening to the Vacation Rental Success Podcast, brought to you by the Vacation Rental Formula Business School. Get access to the knowledge and education to take your short-term rental business to the next level. Visit www.vacationrentalformula.com/bizschool for more information.

Heather Bayer

It's been a pleasure as ever being with you. If there's anything you'd like to comment on, then join the conversation on the Show Notes for the episode at www.vacationrentalformula.com. We'd love to hear from you and I look forward to being with you again next week.