Starting in 1993 with zero customers, zero employees and zero revenue, today, INFO STORs three facilities are collectively billing in excess of $5 million annually, with the very real prospect of doubling that number in the near future.

Vince Gaeta, INFO STOR

Records storage is highly profitable, with profits increasing every yeareven if you do nothing. But youre in self-storage, not records storage. How do you operate a records business in the day-to-day? Here is Records Storage for Dummies, so to speak. It illustrates the basics: storage and services. You will quickly see that what should be complex is completely automated via software. Armed with the facts, you can decide if this business is the add-on for which youve been looking. Odds are, you already have the client base. What customers wouldnt want the option of having their information delivered to their doorstep? For your customer, it means convenience; for you, it means a chargeable service.

Outlined below are the very basic methods for operating a recordsstorage business. Keep in mind that methodology can vary from software to software. You can get more complex and also have a great degree of flexibility. With a few simple steps, you can get started storing, servicing and billing your customers in the profitable business of records storage.

Step One: Setting Up Racking and Charging for Storage

When storing boxes, you will need racking. You can rack as you go, or rack-out a certain percentage of your facility. There are many designs with regard to mapping your facility but Ill save that for another article.

Your racking is broken down into sections and barcoded with individual location stickers. Typically, a single location will hold nine one-cube boxes that are stacked three high and three deep. Each barcode location sticker is assigned in your software to an associated container size, one cube, two cubes three cubes and so on.

Each new account is given barcodes, and those barcodes are placed on the containers. The barcodes are either assigned to the account prior to being released or, when a work order is created to pick up those containers, the boxes become assigned to that account via the work order. When the account returns its containers with the barcodes applied, you place the boxes on your shelving. As you place each box, it is scanned to the location (first you scan the location barcode, and then the box barcode). When the scanner is downloaded, the system knows whose box it is by the box barcode, and how big it is from the location barcode.

In records-center software, you will establish pricing. You will set up service and storage prices for each account, or you may use a standard default. Right now, Ill focus on storage rates.

When establishing storage rates, you can give a rate per box or a price per cubic foot. With the latter, the system will calculate a price per box, i.e., 25 cents x 1.2 cubic feet (the standard box size) = 30 cents. When you run your invoice at the end of the month, the system will tally how many boxes each account has by counting box barcodes. It will know how big the box is from the location barcode. It then multiplies the number of boxes by their size to calculate your total storage charge.

Just thinkyour storage charges are all completely automated, and all you did was scan boxes to the shelf. Not to mention when a customer calls you for a box, you know exactly where it is to be found by the location number.

Step Two: Servicing Customers and Charging for Services

When storing boxes, one expectation is that, upon request, a box or individual file will be delivered. You can accomplish this via your own vehicles or a courier. In the long term, your own vehicle is far more profitable and more marketabledue to associated confidentiality and security issuesthan using a third party.

When a box is requested, you will charge to pull the box from the shelf and for the delivery. If the customer wants the delivery expedited, you will also charge a rush delivery charge. If he wants a box picked up, you charge for the pick up and the re-file (to put the box back on the shelf). All these service charges can be set up in your software on an account-by-account basis or as a standard default.

Now automation comes into play. With every service requested from a customer, you create a work order, select an account number and add the delivery items. You print the work order and give it to the driver or courier. The customer signs upon receipt. Your service is complete.

By placing a box on the work order, you have told the system the box is now out. It knows to bill for delivery as well as a pull for this box on this account. At the end of the billing cycle, the system ties the service completed to the associated rate and bills the customer.

The same applies to a pick up. A work order is generated. The boxes are picked up. The boxes are scanned into locations. The system now says these boxes are in, and charges for the pick up and the re-file. At the end of the billing cycle, everything ties back to invoices. You have complete automation:

Ancillary Profit Sources

As I said earlier, storage and service are basics. Your storage revenue will grow annually for each customer. The industry average is between 10 percent to 20 percent, which not a bad increase. Yet there are many other services and profit streams.

For example, your customer base will need and purchase boxes. Just add the box-order purchase to your work order. Your customer may also want you to complete data entry on each box so you have an inventory of what he has in storage. You can then sell him a report of his inventory. You can complete inventorying projects for your customer and catalog the contents of his containers. The one thing to keep in mind is for every service you provide, you bill the customer. Service means revenue and can make up to 60 percent of your profits.

Summary

Records storage was made easy by the advent of barcode technology, scanners and sophisticated software. If you can scan boxes to shelving and deliver them to the customer, you can master the fundamentals of records storage.

As time goes by, you may become a more sophisticated operation and offer web access and other services. But in the beginning, the most important thing is to set up the system correctly from the get-go. Attend a training class, learn your software and do it right the first time. Buy your last system first. Then sit back and watch your inventories growas well as your profits. Records storage is beautiful thing.  

Anne Sommi Edmonson is the director of marketing for ONeil Software Inc. For more information, e-mail [email protected].