If "location, location, location" is the mantra of real estate development, then "information, information, information" must be the mantra of real estate operation. For European self-storage operators, this creates many potential problems. Each country is unique in its culture, language and business environment, which means facilities in different countries almost need to be managed independently.

As barriers to doing business in a foreign country come down, the challenge for the self-storage operator is how to create an international company in an industry inherently local in nature. The answer to that challenge lies in the technology and communication tools available to the operator, and their ability to provide reliable, useful and timely information to all levels of the organization. Facility-management software is critical to the successful and profitable application of these tools.

Many excellent articles have been written about management software and how to evaluate features and benefits. However, most of the articles have been written with a U.S. operator in mind, who does not have to deal with the unique challenges faced by an international one. The dominance of the European market by large operators with facilities in several different countries only increases the demands placed on management software, at the facility and the corporate level.

In the past, non-U.S. operators were generally faced with two choices in management software: Use a U.S.-made product and try to develop options for features that didn't apply or were not available, or adapt locally developed software from another industry to fit their needs. Either choice resulted in inefficiency and a less-than-optimal operating environment.

Consistency is essential to operators as they expand their portfolios. The goal is to manage all their assets using the same management-software system. Ideally, that system would possess features such as a centralized database architecture, information and functional security, real-time access from virtually any location, flexibility to meet local regulatory or operational needs, and easy customization for each facility. It would also integrate seamlessly with corporate accounting and reporting systems.

The Challenges

Language and currency differences are the primary impediments to the implementation of a cohesive management-software solution for international operators. The introduction of the euro has helped considerably in reducing currency-conversion issues but is not a complete solution. Operators with facilities in Eastern Europe or nonparticipating countries will still face currency-conversion issues when consolidating data and reporting to investors, lenders or other interested parties. Banking-system practices, which vary from country to country, add another layer of complexity to management-software requirements.

Language differences pose a greater software challenge for the international operator. A related problem is that of localization, or adapting the vocabulary used in letters, leases and other correspondence, or the software itself to the vernacular commonly used in the area. For example, while Hamburg, Germany, and Vienna, Austria, may share a common language, cultural or political differences may result in local preferences that should be reflected by the software. Language also presents a software barrier due to the high costs associated with translation, documentation and support.

Internet Power

The rising use of the Internet provides significant opportunities for self-storage operators to reduce or eliminate many of the hurdles to operating facilities across political and geographic boundaries. It also provides a way for geographically concentrated operators to become more efficient and reduce their costs considerably. Currently, e-mail and instant messaging are the primary uses of the Internet by individuals. Many consumers also "window shop" before making purchases at traditional retail stores. But this is changing.

A growing percentage of Internet activity is financial in nature: online banking or bill-paying and purchases from online merchants. The annual growth rate of European Internet users exceeds 20 percent annually, with total users expected to be near 175 million by the end of 2002. In many countries, one person in four is an Internet user. In several countries, the ratio is 1-in-2.

The Internet can no longer be ignored. It has become a viable medium for conducting business and must become part of the business strategy for self-storage operators. Gone are the days when the function of facility-management software was to be a cash register. By using the Internet, management software provides the operator unprecedented ability to access, control, analyze and report his data; in other words, to manage his business. For international operators, these benefits are magnified.

For much of the industry's existence, self-storage operators have viewed the Internet as an electronic billboard. Putting pictures of facilities on their websites with an address, driving directions and office hours was about as far as they would go. A few operators are moving beyond that to create an interactive experience for their customers. Self-storage management software has also advanced to use the power of the Internet.

Nearly every operational process can benefit from the Internet. Online quote generation and tracking or having real-time unit vacancies and pricing available to call-center partners enhances marketing efforts. Conversion of customer interest into rentals is made easier by online reservations and leasing. Customers save time and collection rates improve with online- and automatic-payment features. E-mailed receipts and other correspondence can reduce costs and improve the relationship with the customer. The tools made available by the Internet have the potential to revolutionize the way self-storage facilities interact with their customers.

Corporate Management

Many corporate offices are familiar with the Monday-morning ritual of receiving faxed or e-mailed reports from their various facilities. Others use communication software to access and pull desired reports. This data is then manually re-entered into a spreadsheet or database for consolidation, analysis and reporting. It is in this area the Internet holds the greatest potential for international operators.

Using a centralized database, accessed via the Internet, all the information available to the site is also available to corporate users instantly, from any location with Internet access. No longer must a consolidated report wait for a delayed fax from a facility. When the report is desired for one facility or whole geographical or operating region, whether on Monday morning or Thursday afternoon, it is just a few mouse clicks away. Errors that normally creep into the data from manual, repetitive re-entry are eliminated. And the time saved in collating or consolidating your data results in faster decisions.

Of major importance to international operators is the ability to automatically convert the report data from one currency or measurement to another. The time is fast approaching when facility-management software will be able to take a report comparing a French, Dutch and English facility, and immediately display the information in euros, pounds or dollars. By accessing current and historical currency-conversion rates, such comparisons can be made for facilities in any country and for any time period.

Third-Party Reporting

The newness of the self-storage industry to the European market and its progression through the development life cycle place additional burdens on international operators in their relationships with lenders, investors and other strategic partners. Communication with these partners involves a significant amount of education. The Internet makes maintaining and managing these relationships much easier. E-mail and, especially, extranets are valuable methods of providing information to these partners. With relative ease, a secure interface can be created for you to meet reporting requests or obligations, and to allow your partners to review the activity associated with your relationship.

The Future

Where to go from here? As self-storage markets in various countries mature, the informational and operational demands international operators place on their management software will increase. Current and emerging technologies offer many potential solutions to the unique challenges faced by operators with assets in different countries.

A serious review of the role technology plays in your overall business strategy is clearly warranted. No single vendor will likely be able to meet all your software needs. The key is to employ solutions that are adaptable to multiple business-operating environments and provide extended internal and external data collection, analysis and reporting capabilities.

The Internet is here to stay. Successfully harnessing its potential will provide international operators with greater access, control and security for their data, which translates into better information and better decision-making.

Stephen P. Smith is the senior vice president of business operations for Salt Lake City-based Centershift, a provider of hosted application and online facility-management services for the self-storage industry. For more information, visit www.centershift.com.