SpaceControl Systems Inc.

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ISS: We understand you're about to launch a new Internet-enabled product. Can you tell us about it?

We're pleased with the new chapter Space Control is entering. For the past two years, we've been immersed in a new product we call NX.gen, our next-generation software. What's so unique about NX.gen is it takes advantage of Internet technology, but in such a way that losing an Internet connection won't shut down your business.

ISS: And how do you do that?

We store all the critical data two places. First, site data is stored at the site, so you operate independently from an Internet connection on routine day-in/day-out functions like renting space, collecting payments, move-outs, etc. During the evening, when the site is closed, the data is sent to a secure Space Control web server, where it is stored and can be accessed by a facility owner, corporate office or regional manager.

ISS: That sounds good, but do self-storage companies place much importance on Internet connectivity?

There are multiple answers to that question. First, you can't build a product for the future by relying only on tools of the past. Second, the web is the fastest-growing phenomenon in history. Its acceptance has far outpaced other technologies, such as the telephone and television. Finally, being web-enabled is more than a way to collect end-of-day numbers. For example, we found consumers go online to shop and make comparisons. When you consider they can also make payments, reserve spaces and secure driving directions via a website, there's no doubt the Internet is not only important but essential. What's more, if a self-storage owner is travelling, he can use his facility's website to keep an eye on business via any Internet connection.

ISS: That's a real benefit in theory, but haven't others tried this already?

Yes. There have been storage packages built using the Internet. Some have been abandoned. Some are very slow, which makes it difficult to use with customers. What we're doing to make ours work reliably is the dual storage of data. If you have to connect to the Internet for every transaction and your connection goes down, you're shut down, too. Or if a site is in an area where you can't get DSL connections and must use a satellite, your customer might have to wait 15 minutes just to make a payment. With NX.gen, no matter what happens, you're protected.

ISS: How do you go about creating something totally new?

We're fortunate. I have 18 years experience in the storage industry and a degree in computer science. Our staff brings considerable industry experience, including years of facility management. The storage business really requires experience because no matter how terrific the programmers are, industry expertise is what gives you answers to hard questions.

When we started our new program, it took six months just to define the architecture. If we were less experienced, we could have done it in one month because we wouldn't have known better. What you don't know can hurt you--or your product--badly.

ISS: Who was this product designed for?

Anyone who uses it is important. Owners buy our products because they use the management tools and have their set of criteria, such as security for absentee owners. But if the day-to-day users aren't comfortable with the software, the owners will have problems. It's the employees who keep the facilities operating, and there are so many quirky things in daily operations that this release handles. In addition to the complexities of Internet architecture, a program has to be intuitive enough that first-time computer users are comfortable, yet sophisticated enough that storage veterans can astutely manage their businesses.

ISS: What new management tools does your release include?

True Yield Management is a great addition. Before, you had to spend hours examining reports and changing move-in rates. Now, you establish parameters just once and NX.gen will manage rates according to occupancy levels and seasonal trends. You can even tell it at what point of occupancy to allow move-in discounts and at what point to stop allowing them. Sophisticated software like this lets an owner take better care of business with far less digging for the needed information.

ISS: But that's not a function of the Internet capability, is it?

It can be. The software has the capability, and the Internet lets an absentee owner watch what's going on. The Internet gives owners and managers a convenient way to call up historical information to make comparisons. For example, how does the current week compare with the same week last year? Or how have the pricing changes we made 90 days ago affected our occupancy rates? Or do we need to change the rates at this point, based on the past quarter?

ISS: Do you have a favorite new addition?

Some of our more astute customers asked for a simple report that tells them three things: How much should I have collected this period? What did I actually collect? And what happened to the difference? If you know the answers to those three questions, you've gained a lot of insight. We put it all on a single page.

ISS: What does NX.gen offer that previous releases don't include?

A helpful tool for the owner is a user ID that's recorded on every transaction. There's no doubt about who did what and when.

ISS: In your opinion, what lies ahead for the industry?

I don't have a crystal ball by any means, but I've seen how computers helped the industry make a tremendous leap from the manual systems. Now the Internet will open up the same magnitude of new possibilities. For example, an innovative owner could set up a kiosk in a mall and actually rent spaces using the computer. By linking to a website, a facility could list available spaces and take reservations or rent online. Of course, payments can be collected. If nothing else, owners can stay connected with the details easier than ever; and first-rate management is all about the details.

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