I recently attended a couple of workshops on self-storage demand. The presenters shared some revealing information about the escalating competitiveness of the industry. Given the increased saturation of the business, it’s clear that owners and operators need to better understand their customers and use technology to create a competitive edge.
Technology will drive the self-storage industry to better customer focus while providing improved efficiencies, reduced costs and increased profitability to the owners and managers who embrace it. It will also allow them to better compete in their markets. Following are some technological developments you can expect—and their impact on your business—as we move into a more competitive future.
Understanding Storage Use
As we start to apply more advanced database-mining techniques and tap into sophisticated demographic information and modeling, we are getting to know our customers better—who they are, where they live and why they use self-storage. Current developments allow facility operators to understand their markets and predict demand on a facility level. I’ve seen the future in this area, and it’s incredible how technology can be leveraged to provide more advanced information.
Identity theft is one of the fastest growing crimes in the United States, and the self-storage industry is not immune to this risk. Facility operators must safeguard their customers’ information or face increasing liability. Information regarding tenants’ Social Security numbers, driver’s license numbers, credit cards and checking accounts should not be accessible in any form to facility employees, especially when it can be combined with personal information, such as addresses, phone numbers, etc.
Technology can significantly reduce the risk of fraud by electronically capturing card and account information, masking the information when it is presented on the screen, and encrypting the information while it resides in the facility database. This needs to be the baseline security standard for the self-storage industry.
Protecting Facility Information
There is a downside to technology in that it can be used in ways that are detrimental to a business. Fortunately, it also provides its own solutions! Every self-storage operator should develop and implement a plan for protecting his facility’s information (operational and financial data) and tenant records by doing the following:
- Install antivirus software on your PCs and keep it updated.
- Install spyware software on your PCs and keep it updated.
- Select automated notification of Microsoft Critical Updates and install them regularly.
- Request that your management-software provider encrypt your data in its databases.
- Use card-swipe and check-reader hardware to capture credit-card and checking-account numbers.
These days, integrated technology is being used for e-commerce websites, centralized mail and e-mail processing, call centers, self-service kiosks, tenant insurance, credit-card and electronic-check payments, accounting software, and much more. The future holds even more potential for integration with tenant demographics and mapping, background searches, supply-chain management (merchandise), and a plethora of other options. The ability to integrate with third-party vendors holds a great deal of promise for the self-storage industry. With more powerful enterprise database engines and centralized data, the possibilities are almost limitless.
When it comes to purchasing self-storage products and services and obtaining industry information, technology gives customers the convenience and flexibility of multiple avenues. To compete, savvy operators are using point-of-sale developments such as e-commerce websites, call centers, self-service kiosks and mobile solutions. The key to being able to provide these conveniences is the property-management software you use, so keep them in mind when shopping for a program. The future will bring more creative options to benefit storage customers and operators.
Revenue or Yield Management
There’s no reason the airline and hotel industries should corner the market on yield management, the practice of pricing a product based on availability. Today, sophisticated revenue management, forecasting and demand analysis are being used in the self-storage business. The operators who employ it have found it creates a tremendous competitive benefit. This is one technological development that should really take hold in the years to come.
With increasing competition, consumer choices and market saturation, you need every advantage you can muster—today and in the future. Regardless which advancements you choose to assist in your business, continuing investment in technology will provide the competitive edge to ensure continued success.
Terry Bagley is president and CEO of Centershift Inc., the provider of STORE, a web-based rental-management and point-of-sale software for multi-facility self-storage operations. Formerly the company’s senior vice president of sales and marketing, Mr. Bagley is responsible for Centershift’s growth and strategic direction. He has more than 20 years of experience in management, sales, marketing, strategic planning and business operations. For more information, visit www.centershift.com.