Self-Storage and Self-Serve
|Copyright 2014 by Virgo Publishing.|
|By: Sara Cooper, with contributions by Matt Morgan|
|Posted on: 04/01/2002|
At first glance, a self-storage facility and a self-service carwash may seem an unlikely pair. Closer examination reveals the two businesses are actually complementary. Self-storage operators across the country are beginning to experiment with not only carwashes, but laundry facilities, convenience stores, even can-recycling and redemption centers.
In an up-and-coming business district in Taylor, Pa., sets a 5-acre lot with a self-serve carwash, coin-op laundry and self-storage facility. Taylor Ultra Wash, Ultra Laundry and Ultra Storage make up the Taylor Ultraplex. What seem like disparate business ventures are actually "very symbiotic," says owner Roy Minelli.
Together with his wife, Sandy, Minelli has been involved hands-on in a variety of industries for 20-plus years, including self-serve carwashes and bowling centers. In the mid-1990s, he took an interest in self-storage. After educating himself on the industry at tradeshows and seminars, and doing a demographics study, he became convinced he could build a successful self-storage development.
In 1997, he bought a combination self-serve carwash and coin-op laundry in Taylor, and spent six months restoring them. Minelli then turned his attention to the 40,000 square feet of potential rentable storage on his lot. He worked with an architect and engineer to hammer out compliance issues, settled on a design and, by early 1999, began excavation on the first phase.
Taylor Ultra Storage opened its doors June 1999, and Minelli hasn't looked back. Like other entrepreneurs who are intermingling self-storage with complementary enterprises, he's discovered a surprising number of conjunctive benefits. Advantages include cross-marketing opportunities, a larger customer base and a surge in business during the winter months.
Built in three phases, Minelli's storage facility has a total of 288 units for roughly 39,000 rentable square feet, 4,000 of which is climate controlled. The unit mix runs from 5-by-5s to 10-by-35s, with a majority of units in the larger sizes.
"The biggest challenge to me has been the fragmentation of my attention," Minelli says. It works well that he has someone--his daughter, Stacy--to manage the storage facility while he oversees the wash and laundry. The wash has six self-serve bays; the laundry has 31 washers, 20 stack dryers and two large-capacity dryers, as well as six laundry carts and 10 folding stations. "The challenges of this operation, in relationship to the other two, have been many," Minelli says, "and, fortunately, I have a person who's very capable, in my daughter, who was able to work through this."
Minelli had to learn the maintenance and mechanical ins and outs of the wash and laundry but, in the end, the key to success was a familiar one: customer service. "Treat the customer right, give them a fair service for the dollar, give them a clean place that works right, and you're going to get them," he says.
The family name also has weight in the community, Minelli says, and the Ultraplex lives up to it. "It's very bright here at night, the aesthetic is good and the lot is extremely clean all the time."
The wash and laundry are visible to approaching traffic, with the storage units behind them. The storage office was constructed in the 200 feet separating the original businesses. Access is convenient, too. At center is the storage, with the wash bays on the right and the laundry on the left. "There's quite a panorama of a customer view to our businesses," Minelli says.
Expansion at the Ultraplex will be limited to the storage end, Minelli says. There is room for 6,500 additional square feet of storage space, but development is dependant upon resolution of a property-line dispute. The self-serve wash and laundry markets are overbuilt in the area, though Minelli says he's considering converting one of his wash bays into a high-pressure automatic, an industry trend.
Minelli says he's pleased with his decision to marry the trio of businesses and would probably do it again if he could find the right site. He recommends the blueprint to other facility owners--though he cautions one must learn the different procedures and mindsets involved with each industry.
"I think they are very compatible in many ways," Minelli says. "It offsets the cost per square foot of land and it helps develop traffic that feeds the other businesses. Of course, every revenue source you can get out of a site helps you offset your debt."
Reilly's Dairy Inc.
In 1942, Reilly's Dairy, then known as Meadow View Farm Dairy, was a milk-processing facility featuring home delivery with a single truck. Today, the Suaquoit, N.Y.-based company combines self-storage with a convenience store, carwash, gas station and redemption center. What has kept the business alive and thriving over the course of 60 years? First and foremost, the owners understand the importance of diversification.
Rich Reilly, who took over the business from his father and partner, Thomas Reilly, says the operations are complementary. "When one business is down, one of the others can pick up the slack," he says. While winter tends to be the busiest season for the carwash, the self-storage units attract more customers in spring and summer.
The three-bay self-serve carwash with a touchless automatic was added to the location in 1989. Reilly was already operating the gas station and convenience store, and felt a carwash was a natural next step, much needed in the town.
The 46 self-storage units, constructed in 2000, are the business's most recent addition. Reilly researched the industry extensively before diving in. He had plenty of land to build the units but didn't want to make the investment if the market was saturated. He found most self-storage facilities in his area were maintaining an average 75 percent occupancy rate. Within a year of opening, all his units were filled, and soon he had to start a waiting list.
Operating the businesses simultaneously is challenging, Reilly acknowledges. An operator runs the risk of spreading himself too thin. The benefits, however, include cross-marketing and a much larger customer base. Reilly's employees are cross-trained to assist customers in all areas of the business, and Reilly is on location every day. He hopes to expand the business with another storage building this year. The secret, he says, is to start small, observe the level of need and then expand, one step at a time.
Shawnee Square Car Wash and Storage
Mary Smith, manager of Shawnee Square Car Wash and Storage in Jackson, Mo., meets a lot of people in her day-to-day dealings. Every day, someone is almost always in her office between 8 a.m. and 4 p.m., but her job isn't done when the clock strikes four. If customers needs storage in a hurry, they can call her cell phone 24 hours a day. This is the life of a self-storage facility/carwash manager, and Smith can't imagine it any other way.
"If it were just the storage, I think it would be very boring," she says. "There is not a lot of maintenance to the storage facilities. The carwash gives you a lot more to do." Daily maintenance of the self-serve carwash includes keeping the lot and wash bays clean, emptying the trash, inspecting equipment for wear, and emptying changers. Then there are the customers themselves, who frequently come to her with questions and concerns.
Glen Fronabarger and his wife, Marilyn, owners of Shawnee Square Car Wash and Storage, built the four-bay self-serve in 1995 with one automatic carwash, and 64 storage units. A second automatic carwash was recently installed. The Fronabargers have added storage units every year since opening, and currently have 251. Eight storage sizes are available, with the smallest and largest most popular.
The facility is in a prime location, situated on more than an acre of land in a high-traffic area with apartment complexes nearby. The business gets a lot of repeat customers and referrals. "I think the businesses are complementary," Smith says. "People are here washing and they see the storage or vice versa."
From the Washing Side of Things
Kyle and Jodie Hampton and Jim and Mary Roberts, co-owners of R&H Rentals in Haskell, Okla., have been operating a four-bay self-serve carwash and 40 self-storage units on one site for several years. They also own a 60-unit storage site in town. Not only are the two businesses low-maintenance enough to run simultaneously, they also offer crossover opportunities.
"Pretty much everybody who uses the mini-storages is using my carwash--except for the carwash competitor across the street. But he is using my mini-storage," Kyle says.
Many of the benefits that attract an operator to the self-storage industry are also prevalent in the self-serve carwash industry. Neither business requires a large number of employees or long hours on-site for the operator. Kyle says he probably spends an average of five to six hours a week at the carwash and about 10 hours a month visiting one of his storage facilities.
Another plus is, while carwashes often experience their busiest days during the winter months, storage facilities bring in more customers in spring and summer. For a growing number of carwash operators, adding self-storage is a feasible way to generate extra profit without selling the self-serve short. "If you already have a business going and you just want some added profit, I think it's a great thing," Kyle says.
Chris Klar, owner of two Quick N' Clean Carwashes and the Store More Storage in McFarland, Wis., started out in car washing about six years ago and added self-storage a couple years later.
He now operates 100 storage units in two locations. For Klar, the decision to enter the self-storage industry was simple. The Midwest location offered little existing competition and the price was right.
Some operators may be wary of investing in additional profit centers in the midst of a recession. Neil Valk, owner of two self-serve carwashes and a separate self-storage facility in Tampa, Fla., says now could actually be a good time to get into the business--assuming an operator does his homework. In a faltering economy, corporations downsizing their operations will have a greater need for storage, as will individuals moving to smaller, more affordable homes.
A Good Match
Probably one of the biggest differences between operating self-storage and running a carwash is the amount of paperwork involved. Whereas carwash operators are dealing with the in-and-out customer, self-storage owners must keep track of customers over an extended period of time. On the other hand, self-storage facilities typically require less physical maintenance than their carwash counterparts. Com- bining the two operations in a strategically placed site can generate exposure above and beyond that of a single freestanding business.
"I would recommend to anybody to investigate it and find out if it is right for the area," Klar says. Carwash operators may find self-storage is perfect for filling space on their sites that would otherwise remained unused. At the same time, enterprising self-storage developers would be wise to explore possible partnerships.
For more information on carwash operation and management, as well as franchise opportunities, visit www.moderncarcare.com.