Whose Budget Is It? Including Staff When Developing Your 2012 Self-Storage Budget
By Jim Chiswell
How are you doing on your self-storage budget development for 2012? Every year I’ve been in this industry I find myself asking that question, along with this one: Whose budget is it? On too many occasions, I talk to owners who believe they’re the ones personally guaranteed on the mortgage so shouldn’t it be up to them to decide the budgetary goals for the year ahead?
My answer has always been—no, not really! The budget must be everyone’s financial blueprint. I’ve always maintained that the budgeting process must be embraced by all members of the management team.
As the owner, if you feel only $2,500 can be allocated to repairs and maintenance in the new year, who’s in a better position to make recommendations on how best to spend it? The manager who listens to his customers every day about the broken pavement in the main drive aisle or the owner, who is rarely at the property? The maintenance man who’s constantly replacing light bulbs because of malfunctioning fixtures or the owner who rarely drives by the property at night?
Collecting budget input from everyone on your management team really works. As the owner you still have final word, but now you’ll be armed with everyone’s recommendations and suggestions so you can make the best possible decisions. In addition, your staff will feel like they’ve had input and that you really listened to their concerns.
Once complete, the budget for the year ahead should be discussed, and the goals within the new budget explained. Detailing the underlying assumptions is critical. Go through it step by step so everyone knows exactly what you expect and your operation goals.
Unless you get buy in from your management team, that piece of paper with the columns of numbers has really no meaning to them. As a result, how can you expect it to be achieved?
Take a gamble—get everyone involved and see if 2012 becomes the year everyone remembers as “the good old days!”
Jim Chiswell is an industry veteran and owner of Chiswell & Associates LLC. Since 1990, his firm has provided feasibility studies, acquisition due diligence, mentoring and customized manager training for the self-storage industry. He has served for a number of years on the Inside Self-Storage Editorial Advisory Board, is a moderator on the SelfStorageTalk.com interactive online community and is faculty member of the Self-Storage Training Institute. He can be reached at firstname.lastname@example.org or www.selfstorageconsulting.com.
- Are You Offending Your Self-Storage Prospects Without Realizing It?
- Zoning Exception Clears Way for Self-Storage Development in Jefferson County, CO
- W. P. Carey REIT Affiliate Acquires 7 Self-Storage Properties for $53M
- Absolute Storage Management Releases Fourth-Quarter 2014 Operating Results
- Live-Video Monitoring and Self-Storage: Avoiding Crime, Risk and Liability