An Insider's Perspective on 'Storage Wars': Potential Detriment to the Self-Storage Industry
Copyright 2014 by Virgo Publishing.
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Posted on: 04/03/2012



 

By Joseph P. Niemczyk

While attending the Inside Self-Storage World Expo in Las Vegas a few weeks ago, I encountered a mob of people who were falling all over themselves to get autographs and photos from cast members of “Storage Wars.” It appears the storage industry has become starstruck over this TV newcomer to our business. With the advent of this show, we've seen significant increases in bidders at storage auctions around the country. Additionally, many operators have reported an increase in bids for the units being sold. On the surface, this seems like manna from heaven, but I am not of that opinion!

Although I have limited experience (31 years in the self-storage business having managed more than 20 million square feet, operated and consulted in 25 states and five countries, trained more than 8,000 storage managers, owners and management companies and, yes, even auctioned more than 20,000 storage units), I feel qualified to express my great concerns as to the effect of this phenomenon on the industry. Although I have an appreciation for reality TV and the right to make money, sometimes the cost to others is significant, as in this case. I believe the term "reality TV" is used to attract a large audience, not necessarily to reflect reality.

As an industry, self-storage is a significant participant in the world economy. We’ve spent the last 30-plus years gaining respect in the business and investment community. In the beginning, we were considered a backroom business that neighborhoods and municipalities had no desire to show off, but rather hide in industrial areas.

We’ve come a long way. After all, we are a multi-billion-dollar industry. We now have multi-million-dollar stores in high-visibility locations and are continuing to be on the leading edge of technology.

Unfortunately, selling delinquent storage units is a not-so-desirable aspect of our business. But I don’t believe “Storage Wars” shows the full side of the story. What’s not depicted is the great care owners/operators take to avoid such action. The show leads people to believe we cut locks on the day of the auction. In reality, most state statutes require the storage operator to inventory units and post newspaper advertisements prior to the sale. This is done to give the occupant every opportunity to reclaim his belongings.

Now that there are so many buyers attending self-storage auctions as a result of the show, our normal loyal buyers—secondhand dealers, swap-meet businesses and others—are not participating to the extent they once were. They see the competition for these units as unrealistic to produce a profit. Yes, some facilities' profit is better, but it will be short-lived as buyers discover the vast majority of units contain items the average person would not even want to sift through—unlike the treasures the buyers on the show seem to find.

In its commercials, “Storage Wars” shows potential buyers waving around great sums of money. I submit that this can only lead to repercussions that should be considered dangerous. We now have lawsuits cropping up from newbie buyers who feel they’ve been defrauded if they don’t find the valuables they were hoping for when bidding. I’ve heard hundreds of comments from current and would-be customers about their concerns that all we do is sell personal belongings (not a good trend!), instead of the valuable service we provide to consumers.

It’s obvious the producers of the show are making large amounts of money at our expense. In my humble opinion, this show has set back the reputation of our industry 20 years. Facility owners and operators should say “no” to “Storage Wars.” One of the best things this show could do for our industry is to go off the air.

Wouldn’t it be great if the producers of this show had the confidence to debate a seasoned veteran of our industry in a public forum? Perhaps you'll all get a chance to witness this in the months ahead.

Joseph P. Niemczyk is the president of Executive Self Storage Associates Inc., which offers third-party management services to the self-storage industry. He is a frequent speaker at national and state tradeshows, and has trained more than 8,000 managers, owners and operators in self-storage operation, marketing, advertising and customer service. To reach him, call 303.703.1290; visit www.executiveselfstorage.com.