%20-%20for%20Wix.png)
Is monthly utility billing causing roadblocks in your property management operations?
Discover how the right software can turn these challenges into opportunities to maximize utility reimbursement.
In manufactured housing communities, managing utilities presents a complex landscape fraught with financial, legal, and operational hurdles.
As utility costs continue to rise, property managers are increasingly pressured to ensure efficient recovery despite frequently changing rates and complex regulations. Inefficiencies in billing processes can lead to significant loss, making utilities one of the largest controllable expenses for these properties.
Why does every penny count in utility management?
Efficient utility billing impacts much more than just the bottom line on your financial statements. In manufactured housing communities, the difference between what is billed and what is recouped can significantly impact Net Operating Income (NOI). Accurate utility billing not only prevents financial loss, but also fosters transparency and trust with residents, enhancing their satisfaction and retention.
Table of Contents
Exploring the Financial and Operational Costs of Inefficient Utility Billing
How Billing Affects Your Bottom Line:
In the context of manufactured housing, even minor inaccuracies in utility billing can cascade into significant financial losses. The granular implications include:
Unrecovered Costs: Misalignment between utility usage billed to residents and actual costs incurred can result in substantial unrecovered dollars. A meticulous breakdown of these costs often reveals missed or undercharged utility consumption, which, over time, can erode the profitability of a property.
High Operational Costs: Manual or outdated billing processes are not only time-consuming but also prone to errors, leading to increased operational costs. Efficient utility management software can reduce these costs and save employees’ time by automating many of the tasks involved in billing and collection.
NOI Impact: Inaccurate billing can lead to disputes and delayed payments, further straining the cash flow management essential for operational sustainability.
How Billing Impacts Your Operations:
Navigating the utility billing landscape requires a sophisticated approach due to several operational hurdles:
Dynamic Rate Variability: Utility rates are not static and are subject to frequent changes based on multiple factors, including seasonal changes, market conditions, and regulatory updates. Tracking and adapting to these changes manually is challenging and demands a proactive management system to avoid errors in billing.
Regulatory Compliance Demands: The utility sector is heavily regulated, and failure to comply with these regulations can result in disputes with residents and agencies, not to mention damage to the property’s reputation. Each state or locality may impose unique compliance requirements that govern how utilities are billed, especially in sectors like water. Compliance requires up-to-date knowledge and adaptable billing practices.
Consider: are any of these factors affecting your utility billing recovery?
Overlooking Water Leaks
Inaccurate or Non-Functioning Meters
Administrative Oversights
Given the significant challenges in utility billing within manufactured housing communities, traditional methods – or methods designed for other asset classes like multi-family housing - may fall short. One aspect of utility billing that creates both financial and operational challenges are the charges recovery and usage recovery percentages.
Understanding the Difference: Charges Recovery vs. Usage Recovery
In utility management for manufactured housing communities, distinguishing between charges recovery and usage recovery is crucial for optimizing financial performance and ensuring operational success.
Charges recovery refers to the amount and percentage of the Master Meter Bill (MMB) utility costs that are successfully recouped from residents through billing.
Usage recovery assesses the amount and percentage of utility consumption billed to residents compared to the actual consumption recorded on the MMB.
Misalignments within either of these two metrics can lead to significant financial discrepancies. For instance, a property might appear to have full charge recovery, but that number may only be achieved due to possible allowed charges like admin fees. Those fees inflate the number making it appear higher than it really is. However, if the usage recovery stands at 70%, it could show that the property is not billing for a considerable part of the utility usage, losing potential dollars. Managers must also consider that usage recovery varies based on the shared amenities and even vacant inventory homes within a community. Managing all these factors requires intense attention to detail and is almost impossible to do well manually.
What is the Utility Variance Analyzer (UVA) & Why is it Important?
The Utility Variance Analyzer (UVA) is a specialized utility billing tool offered as part of ManageAmerica's comprehensive utility billing software services.
The UVA is crucial to identify discrepancies between MMB usage/charges and the usage/charges billed to the residents. This facilitates comprehensive utility rate analysis for every submetered utility for every property.
Like all of ManageAmerica’s solutions, the UVA is specifically designed to address the unique challenges commonly faced in the manufactured housing industry, offering a robust solution that integrates seamlessly into the operational framework of MH communities.
This advanced reporting tool is crucial for revealing gaps between billed expenses from utility providers and utility reimbursement from residents.
Key Features and Benefits of the Utility Variance Analyzer (UVA)
These integrated features not only facilitate more precise and efficient utility management but also enhance the overall financial management of properties, ensuring that every charge is justified, and every cost is recovered.
Using ManageAmerica’s Utility Variance Analyzer offers significant advantages that go beyond traditional utility billing software:
Auto-Population of Resident Data:
Streamlines data entry, reducing manual errors
Saves time by filling in usage, charges, and rates automatically at the residence level
Comparative Analysis:
Compares your MMB charges to your resident charges
Compares your MMB usage to your resident usage
Highlights percentage recovery on year-to-date, rolling 12- and rolling 14-month basis
Maximized Recovery: Enhances the ability to recover billed utilities fully so property managers can maximize their reimbursement from utility billing, ensuring that no money is left on the table
Reduced Errors: Significantly decreases the likelihood of billing inaccuracies by specifically identifying estimated reads, sites set to “no bill” for utilities, and sites with zero usage
Better Budget Management: Easily reference MMB charges and resident recovery data from the past year to confidently build next year’s budget
Detailed Reporting: Provides insights such as usage patterns and cost recovery rates that help in making informed decisions to improve both operational efficiency and financial management
By using an advanced utility billing software, property managers can elevate routine administrative tasks from potential headaches into strategic assets for utility recovery maximization. Choosing a software with features like the Utility Variance Analyzer (UVA) can not only boost operational efficiency and profitability but can also ensure no money is left on the table, safeguarding the financial health of your property and improving your resident relations in a sector where margins can often be tight.
How Does the Utility Variance Analyzer Work?
Throughout this article, we've highlighted the robust features and benefits of the Utility Variance Analyzer (UVA). Schedule a personalized demo to see ManageAmerica’s UVA in action! You’ll have a chance to ask questions, discuss your specific requirements, and discover how the UVA can seamlessly enhance operational efficiency and financial accountability across your communities.
Comments