I Hate Making Collections Calls! Self-Storage Managers Learn to Be Good at Rent Collection, Even When They Don't Like It

By Bob Copper Comments
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Who doesn’t hate making collection calls? Let’s face it, calling people about paying their storage bill just isn’t fun. We would rather clean out vacant spaces or straighten the filing system than sit down with that collections worksheet and make those calls.

But we have to do it. As self-storage managers, we have two primary responsibilities and two clear priorities: renting space and collecting rent. If we don’t effectively collect payments, it really doesn’t matter how many spaces we rent.

Unfortunately, the ability to effectively work on and control collections is rarely a natural gift. Some of us are natural salespeople, and some are natural managers with great organizational skills. I don’t know that I’ve ever met anyone I could point to and say, “That guy (or lady) was born to collect money!” None of us wants someone to call us about a past-due bill, and we certainly don’t like calling others about theirs.

Luckily, the skills necessary to be a great self-storage manager with highly effective collections abilities can be learned using proven techniques and systems. You might never learn to love making collections calls—at least, let’s hope not—but you can learn to be good at it.  

Why It’s Important

The first step in becoming a great collector is to understand how important revenue is to the financial viability of your facility. Your owner has a great deal of capital at risk—and most likely a very close relationship with a bank. He expects a certain amount of return for that risk. You have a job because someone was willing to go through a laborious financial and developmental process to build the self-storage site; so it’s important that you, as the facility manager, take your responsibility to maximize revenue seriously.

Think about it this way: What if you owned the facility? Would it be OK to avoid collections calls? Would it be all right to waive late fees and allow past-due tenants to move out without paying their balance? Would you be content to collect only 85 percent of the facility’s potential income each month? Probably not.

Collections Know-How

Once you have a clear understanding of why it’s critically important to do a great job with collections, you need to know how to do it well. A great collections effort starts with a great system. And a great system starts with the initial customer contact and the sales process. How you initially interact with your tenants has a great deal to do with your long-term business relationship with them.

Your first contact must include a professional greeting during which you stand up when the tenant enters your office, ask his name, and show genuine concern about his need for storage. Self-storage customers have many options, so you must show appreciation for their consideration. An initial show of respect goes a long way toward setting the tone of the relationship with a person.

Once a customer decides to become a tenant, it’s important to get the relationship off to a good start. This begins with the tenant-information sheet, a document containing all the information you’ll likely need in case the tenant becomes past-due. When completing the sheet:  

  • Get as much information as possible, even if you need to pointedly ask or the tenant needs to get back to you.
  • Get as many phone numbers and other contact information as you can, including an e-mail address and cell-phone number.
  • Never ask for an “alternate contact.” Everyone knows that means “someone I can bother if you don’t pay your bill.” Instead, ask for an “emergency contact.”
  • Never ask for numbers of relatives or friends. Instead, make a big deal about your great referral program and get as many names and numbers as possible. People will give you more information if they think something’s in it for them than if they suspect you’re looking for people to hassle.
  • You must see and make a copy of the tenant’s picture ID.   

Keep in mind that you’ll never have a better time than at leaseup to get as much information as possible. Once the tenant becomes a delinquency problem, you’re not getting any new info.

The next step in a great collections process is clearly explaining the rental lease. This important document deserves more than a cursory glance and “Sign here. This just says we’ll sell your stuff if you don’t pay.” The customer must understand the late-fee schedule and lien process, and know when his next payment is due. It’s imperative you take the time to effectively review the lease.

Also, quit using the term “grace period.” If rent is due on the first of the month, the tenant should be considered late on the second, and he needs to understand that.   

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