Managing for Maximum Results

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Congratulations! You got your facility approved, built and, finally, filled up. A lot of hard work, worry and effort have paid off, and you now feel like king of the hill. However, this success has created a dilemma. If you are too full, you can’t help the next caller; you get a reputation in the community for being occupied, so no one calls.

At the same time, the only thing that goes down is the temperature at night; everything else goes up. Utilities cost more, property tax rises, wages go up, and inflation, even at a low level, still exists. What to do to offset rising expenses? How about raising rents to new and existing customers? But if you do, won’t you lose tenants? And what about someone else coming into your market and offering low rent-up specials that may draw paying clientele away from you?

Does raising rents actually work? Recently, large operators have reported the necessity of lowering their rates. How do you successfully raise rates to offset increasing expenses when the big guys can’t? Are you ready for the secret? Then, remember this: If you only have price to sell, you will live and die by price alone. If you have value to sell, you can sell value.

The Value of Value

What is value, and why is the customer willing to pay more for it? How can you brand yourself and get away from the belief that all storage facilities are the same and the only difference is the price? Let’s think about this. What do you have to offer the consuming public that will allow you to charge more than the guy down the street? I don’t know what your facility is like, so I will tell you about mine. I make certain it is clean. I make it is as safe and secure as I can. I make sure the staff is friendly and helpful to customers.

If you do all these same things, the real question is, does the prospective customer know it? Does he know what to expect from you and your business? Can he expect consistent courteous treatment and have a positive storage experience? What message do you convey in your advertising? In the way the phone is answered? In your facility’s appearance? In the rental presentation? What do you do to differentiate yourself from the competition in the eyes of the prospect and customer?

How do you advertise your offering? Do you over promise and under deliver or vice versa? Does your customer service produce that “feel good feeling” in your customers and staff, or do you have an adversarial relationship with staff and customers? Both can work, but positivity is easier than negativity, and has longer lasting effects.

Let’s look at it another way. Consider a standard organization chart. At the top are shareholders, then descending along the vertical axis are the president, CEO and COO. The org chart forms an inverted “T,” and along the horizontal axis comes all the VPs: the VP of marketing, finance, production, personnel, etc. Under finance, you have accounts-payable and accounts-receivable. Under marketing, you have advertising, promotion and sales.

So now we have a complete organization chart, right? I think something is missing. What is the purpose of a business if not to serve the customer? If you look at a standard organization chart, where is the customer, and who or what department is responsible for dealing with him?

I think org charts are all wrong. The customer should be at the top, the business and employees in the middle, then the shareholders or owners at the bottom. With this focus, success is yours. If customers are happy, staff will be happy and ownership will be, too. Focus on the customer, and you focus on success.

Your Managers Are Your First Customers

Now that we understand the customer is the No. 1 focus for success, how do we adequately take good care of him? The first customers in your organization are your front-line managers. What type of people should they be? People like dealing with others like themselves, so your managers should mirror your clientele as much as possible in age, education and other demographics. They should also be attired so they can “look sharp, feel sharp and be sharp.” Consider that when you go into a full-service department store, you can immediately identify a salesperson, as he is dressed to impress.

Now we come to wages and training. You may be blessed with long-term employees, but someday they will no longer be with you. If you have depended on the idiosyncrasies of a particular employee and he leaves, you will unlikely be able to replace his unique characteristics. Therefore, the job must dictate the employee, not the other way around. Similarly, anyone—including the owner/manager—must be able to walk into a business at any time, know its status and how it runs. To affect this end, you need to identify the processes (rental process, collection process, etc.), systemize them, and memorialize them in writing to achieve consistent, repeatable results.

Let’s talk about employee pay and benefits. Why do you have employees? The paramount reason is so you are freed from the dayto- day, front-line management responsibilities. No matter how rewarding dealing with the public might be, you are like a piece of real estate and need to be put to the highest and best use. Your job is to make the business work and run. The employees’ job is to work and run the business. That’s why you hire them.

Consider that your employees are on the front line; they deal with the paying customer and can make or break the business because of this. Do you want an order-taker or an order-maker? What does your business require? What are you willing to pay to keep that highly trained, highly motivated, loyal, hard-working employee? Maybe more than your competitors, so a competitor won’t steal them away. Everyone likes medical insurance, too, so consider that as well.

So what kind of a compensation program is best? Consider that while sales drive the business, it is money in the bank that pays the bills. The more money that is in the bank, the more that can go to owners and employees. Therefore, a program that encourages more money in the bank is ideal.

We have discussed that the purpose of business is to focus on, and take care of, customers; and everyone—consumers, employees and owners—are all customers. If you focus on big bucks, the consumer does not care what you want. But if you focus on what the consumer wants, you can make big bucks.

I have examined many field-tested and proven ideas for maximizing your business potential. However, the message herein could be put on the front page of The Wall Street Journal—those who practice it would agree, while those who do not would not get it. This is because diverse people think differently, which is what makes business so interesting.

Each owner has his own ideas on how best to run his business— sometimes successfully, sometimes not. My proven prescription for a healthy, growing business is to make sure all customers feel well cared for. By doing so, you will be cared for in turn. My business continues to thrive and grow, while others complain of lower occupancies and lost revenues. I choose to manage my business for maximum results.

Jack Donner has been in the self-storage business since 1972. He owns America’s Best Self Storage, which he built from the ground up. He spends part-time managing the facility from his home, far from the site. He is a successful business person, coach and consultant. If your dream has become your nightmare, he can help you avoid pain, pitfalls and financial loss, and achieve success. For more information, e-mail jackdonner@cox.net.

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