There are a number of constantly moving variables that affect any self-storage operation. A facility owner’s world revolves around the need to satisfy customers, employees, financial institutions or investors, and even vendors. At the end of the day, it falls on his shoulders to ensure the facility is performing at optimum levels. To accomplish this, he needs to constantly review facility metrics, and move quickly to make changes when necessary.
There will never be a time when everything is perfect, but with a few adjustments in your day-to-day operation, your business can aspire to be “more perfect.” How? Performance is driven by systems. These allow all involved parties to work in unison and reach particular goals. Systems don’t change from one employee, manager or vendor to another because consistency is what allows them to succeed. Once they’re established, tested and adopted, the real work begins: implementation.
Following are four areas of focus in which self-storage owners should establish strategic systems, and then monitor and optimize facility performance.
Focus 1: Marketing
The only way your facility will perform to its full potential is to have a marketing system that moves prospective customers to rent with you. The manager you hire may have limited marketing experience, which is why this system is so important. A marketing system anyone can easily learn and use is paramount to the success of the business.
First and foremost, you need to design and maintain a good facility website, and then create a plan for pay-per-click advertising, map listings and social media. The war for potential customers is taking place online, so you can’t afford to sit out of this arena.
Your system should also include direct marketing (e-mail and print) and strategic partnerships with local vendors, such as movers and realtors. It should include chamber-of-commerce affiliations and events as well as promotional items and contests. The development of each of these areas will create a strong funnel of potential customers.
In addition, consider the use of tracking phone numbers and software so you can calculate the number of leads, closing percentage and return on investment of each campaign you install. Not every campaign will work at every facility. Once you know which ones are producing, you can then eliminate the others and streamline the system.
Focus 2: Sales
Next, you’ll need to focus on sales, or the conversion of prospects to paying customers. While marketing will drive them to your door, your manager will need to “close” them. Many managers have limited sales experience, so again, you’ll need an established system. The ability for managers to successfully use the system is necessary to create satisfied customers and a high-performing business.
Your system should guide employees in how to speak with each potential customer, find out what he’s storing and how much space he’ll need, and then finalize the transaction. One of the best ways to do this is to create scripts for phone and office interaction. Often, when you say “script,” managers will look like you just sentenced them to clean up trash on the side of a freeway. But a script should be nothing more than a guide that helps them know what to say and when to say it. Allowing managers to make up the sales presentation as they go is a recipe for disaster.
Take time to work with your managers and role play. Listen to their calls and how they interact with customers. If your sales system is poorly implemented, you might as well light your marketing money on fire. Sales issues will become a bottleneck in your customer-acquisition process, and facility occupancy will lag regardless of how successful your marketing campaigns have been.
Focus 3: Rates
At the end of the day, you’ll have to gauge the success of your marketing and sales systems; however, financial performance is generally how they’re graded. If your systems are working, all you need to do is conduct a little revenue management to further optimize facility performance.
Regularly review your existing-customer and street rates. You need to identify the renters who have large variances; and if they happen to be in unit sizes you need, it’s time to raise their rate. Also review your competition for any new specials and rate changes. Finally, leverage the revenue-management function of your management software. Set increases to generate automatically, which will ensure your revenue continues to increase.
Remember, the goal is to consistently increase your facility’s revenue and net operating income, not necessarily physical occupancy. If your facility is 100 percent physically occupied, you’re losing revenue, plain and simple.
Focus 4: Site Maintenance
Finally, take the time to maintain your property. Customers are testing and reviewing the facility at all times, so ensure it’s clean, the landscaping is nice, the roll-up doors work properly, driveways are free of potholes, and your doors and hallways are spotless. Regularly service your HVAC system, access gates, lighting and security systems. The office should be neat and presentable, with all rental forms ready to go. Also consider uniforms for your managers. It’s fairly inexpensive and gives your property a more professional atmosphere.
Implementing just a few of these strategies can make a world of difference in the performance of your self-storage facility. Most owners either skip a number of these items or don’t know where to start. Do a little research, ask questions, test some things, and you’ll quickly see results.Matthew Van Horn is a member of the operations team at Reliant Real Estate Management LLC, a self-storage management company specializing in acquisitions, feasibility studies, management and joint ventures. He’s also president of 3 Mile Domination, a full-service marketing and strategy company for the self-storage industry. For more information, visit www.storesmart.org and www.3miledomination.com.