By Kimberly Hundley
When Sterling Management Services takes on a new project or problem-child facility, you can be sure it wont resort to a one-size-fits-all solution. Instead, each propertys distinctive qualities will be embraced and exploited. Its this philosophy thats led to Sterlings virtually flawless record of transforming underperforming sites into profit centers.
We dont aspire to emulate the big guysand Im not mocking the big guys, says Sarah Even, owner of the Boynton Beach, Fla.-based company. For example, I have tremendous respect for Shurgard. But they have formats. They operate just like a McDonalds: Everywhere you go, youll get the same hamburger.
The giants may be able to operate that way, Even says, but the opposite is necessary to create a different image and niche for smaller operators. For every one of our projects, the image we project to the customer and the general public is unique. We match the profile to the marketplace.
A full-service management company, Sterling offers a suite of management services for start-up and existing self-storage companies. Clients can mix and match from such offerings as marketing, operations, onsite supervision, staffing, accounting and payroll. Most, however, opt for full-service management, with Sterling handling operations, policies and procedures, hiring, training and repairs.
We do consulting and facility tune-ups, says Even, who founded the company in 1989. After guiding several facilities into the black while working for a national market-development company, Even dedicated her career to the industry. Well give an analysis of managers and customize a training program to maximize the skills they have behind the counter. Well even train an owner to run his own property.
Property Diagnosis and Cure
Thanks to its staffs expertise in accounting and management software, Sterling is well-positioned to detect costly mistakes owners may not recognize. Case in point is one of the companys recent clients: a newcomer to the industry, he appeared to be doing everything right, beating the competition hands down in terms of quality. Yet hed also gone through five sets of managers within a year and was consistently overstaffing. After studying the books and facility setup, Sterlings team discovered the hidden fatal flaw.
I said, You know what? You dont understand how your management software works, and neither do your people, Even relates. As a result, youve taken this program, and instead of having 10 different unit types, you have almost 200. Nobody has supervised how to do a discount or convert a unit. Your occupancy is understated and so are your discounts. According to your numbers, you think youre giving away $200 a month in discounts; but, in fact, youre giving away $13,000. Because you dont know it, youre not doing anything about it, and youre overstaffed as a result.
For all its advantages, management software cant impart the benefits of practical know-how. Most everybody gets good at what they do by making mistakes. So I guess you are flattening out your learning curve by hiring a company like ours. Youre hiring our experiences and avoiding the mistakes we made to get where we are now, says Even with a good-natured laugh.
Even enjoys the challenge of diagnosing and curing properties that arent living up to their potential. Perhaps thats why Sterling excels at returning seriously distressed facilities to profitability within one year and significantly improving the performance of below-market facilities.
Take, for instance, the older Fort Lauderdale property recently delivered to Sterlings hands. The two-story storage facility had no elevator, had never rented an upstairs unit, and was bordered by a busy interstate and a railroad area frequented by homeless people. Occupancy sat at 40 percent and delinquencies above 50 percent. Maintenance was so poor, the light fixtures were caked with bugs and grass grew through the office carpet. Sterling cleaned up the place, re-staffed, and hired a worker to carry renters property to the previously undesirable upstairs units. Appropriate marketing was also executed.
A national management company had been running the facility for a year and passing on beautiful reports that said why it wasnt performing well, Even says. Within nine months, we had it 100 percent occupied. It was nothing magical. We are willing to get our hands dirty and concentrate on the project. Life is about attitudeyou can say, This is impossible, or you can say, Im going to find a way to make this happen.
Today, Sterling has clients across the United States but is careful to protect its niche by remaining selective. Our approach is to put the clients interests above our own, Even explains. We wont take management contracts if a facility is within 10 miles of another project we are running because it compromises our focus. And we dont do consulting in the same market.
Sterlings fee may be less than many expect. The minimum management fee is approximately $2,500 a month against 6 percent of the gross income, including travel and accounting functions. I think its dirt cheap, Even says. I mean, $2,500 is nothing if I bring in another $20,000 a month. I think were very affordable.
In addition to its management services, Sterling offers feasibility studies, site evaluations, training programs and manuals for managers, middle managers and owners, and more. For more information, call 800.403.0062; e-mail [email protected]; visit www.sterling-mgmt.com.