Can’t See the Donut for the Hole?

Roy Katz Comments
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Forseveral years, I stopped at the same gas station two to three times per week to gas up and grab coffee and a donut. I liked to use one particular pump, which put me in the best position to exit the site and get back on the street. But about two years ago, that pump broke. It was never fixed, and I stopped visiting the station as frequently.

On a recent visit, the manager asked why I stopped coming around as often. I told him to increase his sales, he should fix the pump. He explained the necessary part was $180, and the regional manager decided the cost to fix the problem outweighed the benefit. I countered by pointing out my weekly visits earned the store as much as $220 per year in coffee and donuts alone, let alone gasoline sales. If there were other customers like me, the store could be losing thousands of dollars in profit every year.

In the end, the manager communicated my figures to his supervisor, pointing out the cost to fix the pump was a small price to pay for well-earned business. The result? Let’s just say I walked out of that gas station this morning with coffee, a donut and a little spring in my step. It was the third time this week.

Make Money, Not Donuts

The above experience demonstrates three concepts self-storage operators can put to use in their businesses:

1. Focus on earning as well as saving.

The gas station’s regional manager focused only on the cost of the broken part, not the importance of the pump as a whole. He thought he was saving the company $180, but didn’t realize the business he was losing. In self-storage, some operators work harder to reduce costs than increase sales. They delay renovations, fail to replace broken fixtures, and hire cheaper personnel. To no one’s surprise, they’re usually the ones who complain about business being slow and needing to cut costs.

2. Don’t underestimate the importance of convenience.

The storage industry is based on ease of use, and over the past few years, competition has been defined in terms of added convenience. New customers are being courted as never before with features such as climate control, home pick-up and delivery, and retail products.

Do a walk-through of your facility, trying to experience it as customers do. Examine everything from the parking area to the office to see what can be improved. Also include customer surveys with your invoices or other mailings—you might get a suggestion that will be your next competitive edge.

3. Trust the input of employees.

No one interacts with customers more than your staff, so meet with them at least once a month to get their input and do some brainstorming. Ask about the kinds of compliments and complaints they’ve heard lately. Use a blackboard, dry-erase board or note pad to record their ideas. This lets your team know their thoughts are important and keeps the discussion focused. Never shoot down any idea, even if it may not work in the short term. Finally, when a plan works, give your employee the credit and maybe a small reward.

The key to business success isn’t just controlling costs. You must do everything you can to increase sales and satisfy customer needs. Even “donuts” add up after a while.

Roy Katz is the president of Supply Side, which distributes packaging as well as moving and storage supplies. The company has developed merchandising programs for many leading companies including Storage USA, the U.S. Postal Service, Uncle Bob’s Self Storage, Kinko’s, Mail Boxes Etc. and The UPS Stores. For more information, visit www.suplyside.com.

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