Once every customer who has rented with you for 270 to 365 days has received an increase, your next target group should be those customers with large variance rates. Approach this the same way: Keep increases within your comfort level. If at any time you see significant fallout from your increases, stop, assess the situation, and proceed with what is in your store’s best interest.
Some software packages contain a default rent-increase letter. However, it may not be the right message to send your customer. Instead, use it as a foundation on which to build your own personalized message. The letter should unite you and the customer “in the same boat.” For example, let customers you know you’re facing increases in fees, taxes or other licensing. Tell them you’ve tried to absorb as many of the costs as possible, but you now have no choice but to pass along some of the expense.
Additionally, edit your letter to only show the amount of the rent increase and not the monthly rental rate. Sometimes customers forget their gate codes and unit numbers, and they also forget how much they’re paying every month. Don’t remind them. Just tell them the dollar amount of the increase.
Another common concern is how to approach customers who have multiple units. With these tenants, be sure to raise the rate on all of their units at the same time. A customer who receives a rent increase on just one unit will know the others are soon to follow. Also consider a less drastic increase. Rather than add $10 to each unit and risk losing all of them, give the customer an increase of $15 across the board, or $5 on each unit.
Raising rents is often a manager’s least favorite task, but a necessity to stay competitive and profitable. When considering increases, be fair, be consistent and stay within your comfort level. Find the right balance for your operation and customers to guarantee a smoother process and increased success.
To talk about rent increases with other facility managers, visit www.selfstoragetalk.com, the industry’s largest online forum and community.
March Chase is vice president of Southeast Management Co. and the director of operations for Plantation Storage in South Carolina. His background includes experience as a self-storage manager and district manager for a large management company. To reach him, call 804.435.1605; e-mail firstname.lastname@example.org; visit www.southeastmanagementcompany.com .
Good ole rent increases [Self-Storage Talk]