The self-storage industry has seen remarkable growth in its relatively young existence. With this growth, a tremendous amount of money has been made—and spent. As always, when a lot of money is involved, a lot of attention is attracted. When attention is attracted, smart entrepreneurs get involved. When smart entrepreneurs get involved with a fast growing profitable industry, kingdoms are built. With kingdoms come kings.
Wise kings become very protective of their domains. When domains are threatened, kings ban together to create a strong front to stop all threats. When such an alliance forms an organization, politics inevitably rears its ugly head. Believe me, the politics of deception and personal destruction are not limited to our village.
OK, that’s capitalism, that's how it works and that's why it’s great. Another great thing about it is it always allows for the little guy to fight back, work hard and get his fair share. Now back to our tale.
Overblown Tale of Overbuilding
Well, the peasant rebellion is out of control, so the kings are mounting an attack. They have hired a mighty sorcerer, who is quite a mathematician and soothsayer as well. He and his faithful minions have been sent to the towns and villages to spread their message of gloom and despair, to threaten, strong arm, and scare the peasants into submitting to the authority of the all wise and powerful.
Some leaders within our industry loudly proclaim the end is near. “The market is finally overbuilt,” they wail. “New castle starts are down over the past couple of years, occupancy rates and rents are sinking, the square footage of castle per capita is overflowing; only a jester or a fool would get into this business.”
A sample group was carefully selected, questions skillfully crafted, and the mathematician/sorcerer created amazing statistics, reproduced on high-gloss, full-color parchment for distribution to the confused masses. As a final blow, a mythical PowerPoint presentation was assembled to accompany the sorcerer on his crusade as the final weapon in stopping the uprising. Some of the crowd stopped in their “tracts.”
In the meantime, in a land far, far away from the organization, a land called reality, all the craftsmen kept extremely busy. The steel suppliers, door companies, castle security systems, kingdom managers and everyone in sight had more work than they could possibly handle. Each year seemed to be busier than the last, and this year had already surpassed them all. How could this be?
The wise and powerful sorcerer said the sky was falling: “Run from these kingdoms as fast as you can!” New castles were being built and filling up as fast as the craftsmen could build them. How could all of these have been missed by the sorcerer’s statistics? Something seemed amiss!
Some brave craftsmen, whose companies, families and friends relied on castle building, decided to take a peek at what the kings were doing. Were they panicking, jumping from their towers, drawing the bridges and filling the moats? No, they are fighting to buy each other’s kingdoms, buying castles the peasants have built for themselves, expanding their existing castles and diligently searching for land to build more.
Now none of this made any sense at all, so lowly, uneducated, non-corporate craftsmen and peasants—those most despised, who threatened the organization by bringing “outsiders” into the industry—sought to find the truth.
They all sat down with a keg of brew and began to put the pieces together. One of the most unruly among them finally asked aloud, “Who would benefit the most from deceiving us? Who would profit if all of the outsiders went away, if the craftsmen stopped building new castles, if the banks decided this was too risky an investment, if they could convince everyone that the self-storage story had finally come to an end?”
Hmmm, who would that be, do you know? Well, the kegs ran dry, the sun was rising, and the craftsmen had to get back to work. Their schedules were all backlogged with new castles to be built, even well into the coming year. There was no time for silly games.
Beyond the Myth
The moral of the story is this: When someone works so hard to convince you not to invest in something, always consider the source! Ever notice who is writing those “Dark Ages Are Here for Self-Storage” articles in the Wall Street Crier? These emperors of self-storage doom are wearing no clothes—although they certainly have nice, expensive suits as well as cars, planes and yachts at home. So it would appear the end to this story is nowhere in sight.
The wise entrepreneurs will see overbuilding happens when the kings all build huge castles right across the street from each other. They will notice some first-generation castles are starting to look old, and out of date, and state-of-the art castles built nearby do exceedingly well.
Yes, the wise and brave will see through the mystical statistics and look to where the new village subdivisions are being built, and the new grocery stores and pharmacies are soon to come, and build new storage facilities there, then fill them up and build more.
Rest assured, dear reader, there is still plenty of room in the market for lots of “outsiders” to make enough rubles to live happily ever after.
Bruce McCardle is the eastern division manager for Mako Steel Inc., a supplier and installer of storage buildings from coast to coast. More than 80 percent of the company’s business comes from repeat customers or their referrals. Mr. McCardle has been involved in almost every aspect of the metal-building and construction industry for more than 20 years. He shares this column with Caesar Wright, Mako’s president. For more information, call 888.795.7594; e-mail email@example.com; visit www.makosteel.com.