Rethinking Resident Property Management: Determining Your Budget for a Package Management Solution

This is part three of a multi-part blog series on package management vendor selection. To read the previous part of the series, click here: Gaining Stakeholder Buy-In.

Budgeting is never an easy task for multifamily property managers. However, it’s also more challenging today, as the industry faces tight margins, uncertain market factors, political pressure, inflation, and other issues.

If you’re looking to budget for a package management solution, it’s essential to consider several key factors. In this blog, we explore how to effectively determine the budget for a new package management solution.

Identifying Your Budgeting Goals

Net Operating Income (NOI) improvements are a critical consideration when evaluating package management solutions, as they can significantly enhance property profitability. Equally important is Return on Investment (ROI), which requires analyzing whether the solution creates sufficient value relative to its total cost of ownership. Utilize cost-benefit ratios or more sophisticated evaluation methods to determine your ideal Total Cost of Ownership (TCO).

Soft Metrics Also Positively Impact Your Bottom Line

Remember to account for more intangible metrics in your budget planning, particularly resident satisfaction. Renewal rates, word-of-mouth recommendations, and positive social media engagement directly strengthen your bottom line.

For instance, parcel lockers have proven to be an amenity that significantly boosts resident satisfaction and lease renewals, with some communities experiencing up to 40% renewal rates following installation.¹ Smart locker investments yield exceptional satisfaction returns because, unlike amenities like dog parks or EV charging stations, they serve nearly the entire community; approximately 90% of residents surveyed utilize parcel lockers, in their buildings with locker systems, with 73% receiving one to three deliveries weekly.²

Thwarting Thieves Boosts Your Reputation

Porch piracy is rampant and every stolen package chips away at your hard-earned reputation. Consider these three startling statistics:

1. In 2024, almost 75% of Americans experienced package theft.³

1. 26% of people worldwide have had a package stolen from their porch, front door, or mailbox. Of these, 40% said the theft occurred within the past year.⁴

3. More than 58 million Americans have had packages stolen in the past year.⁵

With more Americans worried about package theft than ever before, it’s essential that properties deliver the security that apartment residents expect. By meeting this expectation with solutions like smart package lockers, properties can preserve reputation – an important metric in attracting and retaining residents.

A compelling case study of how smart lockers prevent both package theft and property damage is Plaza Hills in Kansas City, Missouri, managed by FirstService Residential. The community is enclosed by perimeter fencing with four electronic access gates, but this security proved insufficient for package protection. Deliveries were often left in the open, either lobbed over the fence or left at unstaffed kiosks, making the property a prime target for opportunistic thieves and forcing the community to spend thousands of dollars (that were not in the budget) on gate repairs.

Installing lockers successfully thwarted thieves and made property management much easier. As Marissa Greene, a Property and Portfolio Manager at FirstService Residential explains: “This was a very meaningful success for us, being able to solve such a significant package theft issue. The [Homeowner’s Association] board is happy we’re not incurring unexpected expenses for repairs and the residents are relieved and thrilled with the new package system. Everyone wins…except the thieves.”

Questions to Ask Your Team

As you work through budget issues, make sure to ask your team these critical questions:

• Have we thoroughly examined all the financial implications of implementing a package management solution?
• Have we effectively compared the short- and long-term implications of various funding options?
• What potential barriers might prevent us from obtaining necessary funding?
• Why is this solution necessary now, and why should we prioritize this investment over other possibilities?
• What risks do we face by not implementing this solution?
• How will secure package management affect our competitive market position?
• What obstacles might prevent us from implementing a package management solution?
• Do we have concerns about scalability if resident package volumes increase in the future?

Next Steps

Once you’ve determined and secured your budget for a package management solution, you can begin researching potential vendors. Identify companies with proven track records in the multifamily industry, request demonstrations to evaluate user experience, and compare features against your specific property needs. Consider scheduling site visits to communities using these systems and gathering feedback from both staff and residents to inform your final decision.

Budgeting for smart lockers involves considering both hard costs and soft metrics. Lockers typically free up staff from the package business while increasing resident satisfaction, boosting renewal rates, building online buzz, and virtually eliminating porch piracy, thereby enhancing your reputation.

Innovative Financing Options from Parcel Pending by Quadient

If package management wasn’t initially in your budget, now is the time to discuss with vendors any special programs they offer. For example, Parcel Pending offers a number of flexibile financing options, including our subscription plan.

Parcel Pending’s subscription plan offers multifamily properties a flexible way to implement smart locker solutions through one predictable, all-inclusive monthly fee on a 60-month term, with no upfront investment required. This comprehensive fee covers all locker-related expenses, including maintenance, service, and shipping costs, providing complete financial clarity throughout your contract.

Another Budgeting Option: Having Residents Share the Cost of Amenties

Another innovative way to finance smart lockers is for the community to pass on the cost to residents. Winther Investment Inc. is an upscale multifamily lifestyle development company headquartered in Houston, Texas, operating 12 communities across Texas, Pennsylvania, Oklahoma, Ohio, Arkansas, and Missouri. When it adopted our lockers, it charged its residents $10.00 per month to recoup some of their investment. Notably, this transformation improved the package delivery experience for both leasing agents and residents. As Christopher Young, Regional Supervisor for Winther Investments, explains, “making the switch truly got us out of the package business; we are literally making our residents happier with this amenity.”

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Need help incorporating package management in your budget? Speak to a Parcel Pending representative today to learn more about our pricing options, including our subscription and revenue share plans.

Sources:

1. Survey results gathered from case studies conducted with residents at Cortland Partners properties.
2. Parcel Pending by Quadient. 2024 Resident Preferences Report. www.parcelpending.com. August 2, 2024. https://www.parcelpending.com/en-us/resources/2024-resident-preferences-report/
3. Edwards, Rebecca. Worst Metro Cities for Package Theft for 2024. www.safewise.com. November 5, 2024. https://www.safewise.com/blog/metro-areas-porch-theft/
4. Vivint. Protecting Your Packages: Global Porch Piracy Insights. www.vivint.com. n.d. https://www.vivint.com/resources/article/global-porch-piracy-insights
5. Reuter, Dominick. Insuring deliveries against porch pirates requires some surprisingly tricky math, but one founder says he’s figured it out. www.businessinsider.com. December 7, 2024. https://www.businessinsider.com/insuring-deliveries-against-porch-pirates-takes-tricky-math-ceo-says-2024-12