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5 Things You Must Do To Thrive In 2011 & Beyond

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Use some of these tips to help your self storage facility thrive in 2011 & beyond.

Use some of these tips to help your self storage facility thrive in 2011 & beyond.

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  • 1. 5 Things You Must Do To Thrive in 2011 and Beyond
  • 3. MARKETING Additional ways of marketing in this economic environment
  • 4. Yellow Pages & Internet Marketing • Yellow Pages- Because of the decrease in usage, most reps will give you much cheaper pricing than past years. The difference you save in your yellow page budget should be moved over to optimizing your internet listings. • Internet- Plain & Simple. If you’re not on it, and optimized, you’re losing rentals!
  • 5. Affiliates • Be sure to offer a referral commission • Local Businesses • Moving Companies • Apartment & Condo Complexes • Realtors • Competition!
  • 6. Referral Programs • A common program that works is a $25 credit for the referrer (current tenant) and a free month for the referral (new tenant). • Mail your current tenants once every 3 months with a referral letter and referral cards. • Give referral cards to all new move ins and keep a stack on your office counter.
  • 7. Other Creative Marketing • Online Radio Spots- Many people listen to online radio at work. Cheap sponsored video links are available via “listen live” button on radio station websites. • Bus Benches- Place advertisement on bus benches surrounding competition. Provides cheap permanent signage. • Neighborhood school buses w/ signage.
  • 8. Bus Bench Advertising
  • 9. School Bus Advertising
  • 10. Power of Viral Media • Remember • A happy customer will tell 3 people about the experience at your store. An Angry Customer will tell 16…...16,000 (Youtube, Twitter, etc..) • * The Power of Viral Media: Angry Customers Armed with New Weapons : Teri Lanza: Inside Self Storage.com
  • 12. Who Uses Storage 2009 Almanac • Residential 74.4 % of all rentals and stay 13.7 months • Commercial are 20.8% and stay 22.5 months • Military are 2.9% and stay 11.8 months • Students are 1.9% and stay 4.5 months *Ten years ago Commercial users were only 10% of the market and had an average stay of 24 months however Residential users only stayed 4-6 months.
  • 13. Stanford University Study • 17% of customers will choose the highest price for any service. • 13% of customers will choose the lowest price for any service. • 70% of customers choose a service based on something more than price!!!! * Stanford University Study (Mini Storage Messenger, July 2009, Does it Pay to Discount?)
  • 14. Services To Offer • PO Box area, Conference room. • Wireless internet. • Coffee, Hot Chocolate, Water. • Accept deliveries. • Garage sales. • Select a local charity.
  • 16. COMPARE YOURSELF TO COMPETITION • The latest statistics show there are an average of 7 competitors within a 5-miles radius. • What does their office look like? Spacious, clean… • What does their merchandise area look like? • How does it smell? • What are the managers like? Knowledgable, professional… • What is their CLASS (A,B or C)? Any competitor that is less than a Class C do NOT include as competition.
  • 17. Class Types of Properties • Class A Properties: Properties featuring above-average design and construction quality. Offer a Retail Area and have a Security System along with Computerized Access. Typically have an On-Site Manager. Command the higher rental rates and have a superior location in terms of desirability or accessibility. • Class B Properties: Properties with adequate design and construction quality. Have Computerized Access along with an On-Site Manager. These typically command average rental rates and are generally well-maintained and desirable to most tenants. • Class C Properties: Properties offer adequate functionality but few amenities. The physical condition is acceptable but may have some deferred maintenance. Command below-average rental rates and are in a less desirable location.
  • 18. Office Area • Large office area room for merchandise. • Managers in uniform or dressed professionally. • PO Box area, Conference room. • Wireless internet. • Security monitors visible. • Coffee, Hot Chocolate, Water.
  • 19. Property • Unit with no garbage & swept clean. • Clean golf cart for customer to ride on. • On cart have water and sealed locks. • Signs pointing out security. Cameras, Alarms. • Temperature controlled building connected to office. • Does facility need painting?
  • 20. Visibility • Landscaping crisp and clean. • Signage…electronic reader board, banners, wind socks. • Windows on a multi-story building. • Can roll up doors be seen when driving by?
  • 21. Manager Support & Training
  • 22. Where to Find Information?
  • 23. Legislation WHAT HAS CHANGED? • Review Trade Magazines Monthly: ISS, Mini Storage Messenger, SSA, State Association Publications • National and State Association Trade Shows: Each trade show typically has information in relation to the changes in legislation • Legislative Work Shops: Typically 4 - 8 hours in length • Attorney: Have attorney review statutes
  • 24. Technology SMART PHONES, IPADS, FACEBOOK, TWITTER, ONLINE SOFTWARE, KIOSKS, SEO WEBSITES WE ARE NOT IN KANSAS ANYMORE…. • Review Trade Magazines Monthly: ISS, Mini Storage Messenger, SSA, State Association Publications • Internet: Review technology related sites and blogs • Test: Go to Trade Shows, Best Buy, etc. and try items out, see if it works and will it help NOI.
  • 25. Management Techniques & Operational Methods • Consult Industry Experts: Management Companies or Industry Consultants • National and State Association Trade Shows: Workshops and Speeches are a great way to keep on up updates in techniques and methods. • Read: Industry Trade Magazines, Success Magazine, Entrepreneur Magazine, browse Barnes & Noble and Amazon.com for
  • 26. Train & Implement • After you have done your research decide the time line for training and implementation. • Training, depending on the extent of the project, should be done onsite. Written Instructions & Procedures should be provided • Smaller projects will implement quickly: Phone System, Online Software, Social Media. • Larger projects will implement on a longer time table: SEO Websites, Kiosks, Paperless Transition.
  • 27. Follow Up • Implementation without Follow Up is worthless. • Never leave a project to chance. After Training and Implementation make sure your Regional Managers and Facility Managers are comfortable with the new items. If not, consider additional training. • Is the project having a positive effect on NOI.
  • 28. MANAGING REVENUE Cut Expenses
  • 29. Expenses • Reduce size of Yellow Pages. • Internet presence. (free sites pay per click) • Eliminate security deposit go to Admin. Fee. • Discount pre paid units. • Shop credit card processing companies. • Invoice by e-mail. • Up collection call.
  • 30. Expenses • Appeal Property Taxes. • If climate controlled resent thermostat settings. • Install energy efficient bulbs and ballasts. • Install motion sensors. • Possibility of solar panels. • Switching phone service provider. • Remove dumpsters.
  • 31. Expenses • Insurance 1. Increase deductibles. 2. Membership through certain types of organizations. 3. Reduction when grouped with other sites. 4. SHOP THE POLICY.
  • 32. Payroll • Approximately 81% have implemented a hiring freeze or staff reductions. • Reduce benefits…Medical Insurance, vacation and sick time. • Prohibit overtime. • Cross Train - sharing employees between multiple sites.
  • 33. Payroll • Cutting office hours. Example from 8 hours business days to 6 hour business days. • DO NOT make managers subcontractors.
  • 34. YES! Raise Rates
  • 35. Why We Raise Rates: 1. Raising rates is normal, expected and NEEDED! 2. For a facility to stay profitable we must increase rates to counter the increase of expenses. 3. If you are 100% occupied you are losing customers. 4. Operating Expenses increase every year…PAYROLL!
  • 36. Making Increases Easier! • Involve manager on what reasons why, how much to raise and authority to handle any customers who have a concern. • Get tenants on auto pay credit card! • If multi story higher floors less likely to move out.
  • 37. When To Increase. • Any time any given size is over 95% occupied. (RENT PUSH) • Any time you add anything of value to the facility... 1. New Security Features. 2. Maintenance such as painting of building or doors, new asphalt… 3. Opening of new units.
  • 38. When To Increase. • Opening of new competition. • Extremely HOT months! • Extremely COLD months! • When competition does.
  • 39. Why 2 Increases A Year: According to the 2009 Self-Storage Almanac in 2008: • Average residential stay is 13.7 months a 11% gain from 2006. • Average commercial stay is 22.5 months a 8.3% gain from 2006. • Average Military stay is 11.8 months a 8.6% gain from 2006. • Even students average a 4.5 month stay in 2007. • If we increase 2 times a year when the average tenant receives the second increase and calls. We tell them because they are a GREAT tenant we will cut the second increase in half. The facility still achieves a 10% increase, the tenant loves us and may stay longer than the average because we worked with them.
  • 40. . Example On Increase. • If we have 100 tenants paying $100 each and you raise 2 times at 7% at the end of a year the unit is $114. • Before increase 100 X $100 = $10,000. • If lose 10% because of increase collect 90 X $114 = $10,260. • This is an increase of $260 per month plus you now have 10 units to rent at $114 per month.
  • 41. WHY IS A FEASIBILITY STUDY NEEDED • IF YOU DO NOT PLAN CORRECTLY NOTHING WILL MAKE A POOR LOCATION GREAT! • Most lending institutions REQUIRE a feasibility study prior to applying for financing. • To determine if you are paying too much for the land. • Is there enough demand for storage in the area? • What is the quality of competition in the area? • What is the proper unit mix for this area? • What type of return you can expect at this location.
  • 42. 7711 South Main Street Midvale, Utah 84047 801.273.1267 801.208.0431 FAX 1-866-970-EDGE (3343) www.cuttingedgeselfstorage.com