Launching a Portable-Storage Business: Business Models, Costs and Potential Revenue

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By Michael P. Smith

Self-storage facilities generally serve customers within a three- to five-mile radius. A portable-storage operation, on the other hand, can service up to a 100-mile radius and beyond due to long-distance moves (LDMs), making it an attractive investment.

When starting a portable-storage business, entrepreneurs have two options, each with its own benefits and challenges. The traditional franchise model provides a candidate with a larger serviceable population, ownership of the equipment, and more potential for revenue due to market size, but it’s also a larger investment. The other option, which is fairly new to the industry, focuses on bolting portable storage onto an existing self-storage or moving business. It’s referred to as the fractional concept. The initial investment is less than that of a traditional franchise, and the equipment is typically rented rather than purchased.

Each concept provides flexibility and value, but to ultimately make the right decision, you’ll need a few more details. Let’s take a closer look at your options.

The Franchise Model

The traditional franchise concept usually involves a first-time entrepreneur in the moving or storage industry. Typically, you’ll need to obtain a warehouse, delivery system, personnel and inventory. Your territory fee, which averages $49,000, involves a population of up to 800,000. Depending on the density of the population, the local coverage zone could extend more than 200 miles.

Once your warehouse is in place, you’ll need various equipment. This could include:

UNITS Table***

You'll also need minor tools for preventive maintenance on all your equipment. In terms of personnel, each location must have a customer-service representative and a warehouse manager/delivery driver.

The Fractional Concept

The fractional concept was designed for candidates who already have a moving or storage business and would like to serve a whole new customer base. All that’s needed is space to store portable-storage units and a pickup truck to pull the specially designed delivery system. The need for a customer-service representative and delivery driver is required, but in most cases, existing personnel can fill those roles. The costs associated with this option are much less and work on a lease-to-own program in regard to the containers to reduce startup costs and initial investment.

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