Online bills that include auto-pay are even easier to skim through, and sometimes don’t get examined at all. Here, you don’t even have to enter in payment information; it comes out automatically. There’s even less of an incentive to review and approve auto-pay bills because you know they’re already taken care of. Simply put, the less time you spend reviewing and thinking about your regular monthly bill, the less of a chance there is that you will find a mistake.
That’s one reason we believe many vendors are pushing their customers to switch to online and automatic billing. In fact, they’re even willing to give their customers a discount to switch. Some vendors offer up to 5% discounts for customers who eliminate paper statements and billing. Sure, some of that incentive is because it costs money to have paper statements created, mailed, and processed. But we believe vendors also know there’s a greater chance that errors—and generally they are errors in the vendors’ favor—will be missed or ignored. They’ll make enough money off of those errors to “pay” for the 5% discount they give their customers.
As a property manager, your time is extremely valuable and is already split up among many competing priorities every single day. The last thing you need is to go through a complicated monthly bill, skimming line by line to look for mistakes. Add in the time spent trying to figure out whether you are getting the best deal from your utility company or even paying for the correct level of services for one of your facilities, which might be different from a different property you manage. All of these hours spent chasing down a $50 mistake on one of your units just doesn’t make sense, or does it?
Imagine for a minute that the $50 mistake you found is repeated in each of the ten buildings you manage, every single month. That small mistake quickly turns into $500, and if you allow that error to stay unnoticed on your bills for five years you are now looking at upward of $30,000. Not such a small mistake after all.
So what are the solutions to common billing errors that are going unnoticed, and how does a manager even begin to spot them?
Well, the first step is to take the time to carefully look over each bill and question what each charge actually means. Whether you go through all of the bills personally or one of your employees handles it, this part of the puzzle is vital, even if it takes a little extra time. For example, if you are looking at your utility bill for multiple buildings, some of the things you might want to watch out for are:
Duplicate line-item charges: Review every line item within your bill and look for accidental duplicates. Sometimes vendors accidentally charge you twice for the same thing and these can add up in a hurry.
Incorrect rates on your bill: It can be very time-consuming, but it is important to check your bill to see if you are being billed at the correct rate is extremely important. While doing this you may also find that you are being billed for things that were not specified in your original contract.
Incorrect meter readings: With utilities, there is always the possibility that your meter was read incorrectly. Take the time to check the meter and compare it to the reading on the bill to look for any inaccuracies.
Overlaps with previous bills: You may find that a few days overlap in the service period listed each bill, leading to an overcharge for these days. Look for these overlaps and bring them to the attention of your utility company or vendor. If there are overlap errors it is wise to retroactively search through your bills to see how long this has been happening. The vendor may even owe you some money.
Other areas you can look for overcharges include phone bills for your office or common area, landscaping bills, bank fees that are pulled directly from your account without a billing notice, janitorial services, and elevator maintenance. For some of these bills, a key reason property managers are likely losing money is from not spotting over-servicing. For example, if you have multiple phone lines it is possible that some of those lines are not plugged into anything at all. Even though they are not connected and not being put to use, you are probably still paying for these lines. Another great example of not spotting over-servicing is your waste hauling. If you have your waste containers picked up twice a week or more, it is very likely that at times you are having empty or near-empty containers picked up for you. If this is the case, you will still be charged for the pick up. To have a better idea of what is being hauled away it is necessary to track down the weight of the pick-up by calling your service provider and requesting these details. If you notice a pattern of low weight pickups during the week you can cut back the amount of times your waste is picked up, ultimately saving you money.
It is also extremely important to compare what other locations similar to yours pay for their bills compared to you based on the spend data per resident. However, having the time and know-how to track down this information is not the easiest thing to do and may be better left to a professional company like SIB who will do the work for you.
Bills are complex, especially if you manage multiple multi-family residential complexes with a small staff that have other things to worry about, like filling your vacancies with new tenants and taking care of the tenants you already have. If you don’t have the time or manpower to skim over all of your bills, or just don’t think you have the expertise to understand them, there is always the option of employing a company like SIB who will go through your bills for you and help you to find those errors. The beauty behind employing a contingency-based company like SIB to do the work for you is you only pay if savings are found, so there is no added cost to you.
About SIB Fixed Cost Reduction:
SIB is a firm specializing in fixed, monthly cost reduction. By employing experts with extensive experience in each of the fields we specialize in, we are uniquely equipped to find savings in virtually any fixed cost category without changing your current vendors. Unlike consulting firms, we only bill based upon the savings that we find and you are not invoiced until savings are realized. If we don’t find savings, you pay nothing and know that your bills are as low as possible. SIB has worked with Fortune 20 companies, restaurant groups, hospital groups, regional banks, grocery chains, retail chains, state, local, and federal government entities and many others. Since we opened our doors, we’ve found savings for over 98% of our clients. SIB makes the process of cost reduction effortless for your company, allowing you to rest easy knowing that industry experts from each of your monthly cost categories are working hard to reduce your costs.