Special Operations: Profit Depends on Discipline

Most self-storage operators fear new competition coming into their market. When it happens, they typically become reactive instead of proactive. For example, when a new facility pops up around the corner, most of them decrease rates and pump up promotions for fear of losing market share. Instead of anticipating and preparing for increased competition, they are caught by surprise.

Is it possible to hold rates steady or even improve on income per square foot in times like this, or would it be too risky? Absolutely, it can work, if done properly. In fact, if rates increased, it might entice the new competitor to offer higher rates and spur on a win-win situation for both parties.

An effective way of combating competition and enhancing the profitability of a self-storage business is to develop the proper systems and create accountability within operations. This makes your team responsible for achieving goals and objectives established by the company.

Most storage operators need better systems to hold employees accountable for achieving results. Start by tracking and measuring key performance areas to improve your operation in the long run. How can you enhance aspects of your business if you don’t know where you stand?

One area that needs to be measured within the sales process is how many callers are converted to renters. How many walkin customers sign a contract? With a measurable system in place, everyone involved in the selling effort knows the conversion rate and what is expected in terms of results.

Tracking gives each staff member a measurable “scoreboard” of where he stands in relationship to what is considered poor, average, good and great performance. It’s important everyone becomes involved with setting the standard to create the consistency needed for long-term success. Make it an all-inclusive project.

Another way of establishing accountability is to set goals within the key areas of your business. For example, you might set a monthly goal for unit rentals that is realistic but challenging. This gives employees a target to aim for and will help to set the expectation in terms of acceptable and exceptional results. Employees tend to like monthly goals because they are more immediate than quarterly or annual objectives and easier to track.

If the team is up against a challenging month as a whole, everyone can “wipe the slate clean” for the next month and concentrate on re-focusing on future achievement. This can strengthen the accountability of the team if the level of expectation is measured in a way that is understandable to all.