In the event you conduct an audit and find a shortage, you should not allow or require the manager to replenish the missing funds. Inquire as to how the problem occurred and use this as a training opportunity to prevent the issue from happening again in the future. Note: A person willing to pull money from his pocket to cover missing funds will also pocket the money if there is ever an overage. If the shortage was an honest mistake, do not punish the employee. If you suspect theft, handle that situation accordingly.
Boxes and packing supplies can be very profitable for your self-storage business. These are typically items of convenience; therefore, it is not nearly as necessary to have the lowest prices in the area. The primary problem with boxes and packing supplies is shrinkage.
Shrinkage is basically the difference between your actual inventory and reported inventory. It can result from customer or employee theft, damaged stock or inventory counting errors. Keep record of inventory so you know what you should be making from the sale of those products. You should also verify that the inventory ordered and delivered is what was actually accounted for correctly in your software. Catch these issues early, as this makes it easier to identify and correct the problem.
Performing an inventory audit is simple. Count everything in your warehouse area and display items. This makes up your actual inventory. Compare that information to the inventory reported in your accounting software. If there is a discrepancy, find out why. Boxes and merchandise are an expense until they are sold, so keep your eye on the ball.
Most people do not think of sales presentations as an area that should be audited. A sales presentation is the number one reason you rent to a customer. If your managers’ presentation is lacking, so will the performance of your property.
There are several ways to monitor the presentations:
- Do it yourself
- Have a friend mystery-shop your manager
- Hire a company to monitor progress
The sales presentation should be audited as much, if not more, than the other items mentioned in this article. It has the biggest financial impact on your property.
Audits should be unscheduled and completely random. I recommend a thorough audit at least once per month and sometimes directly after a regular visit to keep your manager guessing. An honest manager will not take umbrage on your practice. If he does, you might want to dig a little bit deeper.
Brian Byrd is the vice president of sales and marketing for Landvest Corp. The Wichita, Kan.-based company offers third-party management options, training, consulting and development services to the self-storage and multi-family housing industry. For more information, call 316.634.6510; e-mail firstname.lastname@example.org.