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2 Business Models for Getting Into the Mobile Self-Storage Industry

Mobile self-storage is the fastest growing segment within the storage industry. There are two primary business models self-storage operators can use to enter the mobile segment. This article takes a look at the pros and cons of each.

July 2, 2012

5 Min Read
2 Business Models for Getting Into the Mobile Self-Storage Industry

By Robert Vespa

Mobile self-storage is the fastest growing segment within the storage industry. More and more consumers are learning about mobile storage as an option and using this service. Also, in ever increasing numbers, they're choosing to use containers to move their households in lieu of traditional movers. With these trends in place, how does a self-storage operator get into the mobile-storage business? There are two primary methods: invest in containers or become a franchisee.

To determine which model is right for your operation, first consider what youre trying to accomplish as a business owner. Are you attempting to capture the occasional customer interested in mobile storage? This strategy allows you to add a few customers to your existing base. The second strategy is that of building mobile-storage into a standalone business. Lets take a look at the pros and cons of each model.

Adding Containers

Lets assume youre just trying to capture some customers who would otherwise go elsewhere. The real difficulty here is where to store the containers. Most will not fit into your existing facility. The only options may be to store them outdoors on your current property, or locate some warehouse space you can rent.

Today, there are some very good manufacturers that offer containers that can be exposed to the elements and left outdoors. Even if your current location would support something like this, youll still need a delivery system to provide the service. You can certainly find those in the marketplace as well. The advantages of this approach are clear: You can grow at your own pace, the initial investment can be limited, and youll have no real obligations going forward.

However, this strategy has its downsides as well. Youre not actually growing a business but developing a line extension that may be an additive to your business. With this option, you can never really get to scale on your business, and youll have to figure it out on your own. Youll likely make some mistakes and burn a lot of man hours along the way. Finally, theres no network that would give you access to cooperative market or leverage for interstate moves if this is a segment you want to participate in as well.

The Franchise Option

If youre more serious about the mobile-storage business, you should consider looking at a franchise opportunity within the industry. Franchising allows entrepreneurs to take advantage of a total business system thats in place and allows them the best opportunity to succeed. A good franchise organization will provide three key elements to its franchiseesbrand, operating systems and ongoing support.

A strong brand is critical to any businesses success. You need to be able to develop a brand in your market; it's essential for your ability to get customers. There needs to be a clear direction for your brand and a plan to grow and develop it.

As a franchisee, you benefit from the collective efforts and investment of the many franchisees as well as your franchisor. Through everyone's efforts, you gain great leverage. Remember, name recognition will allow you more opportunities to speak with potential customers.

Another important deliverable from your franchisor is the operating systems it has in place. Examples of these systems are marketing, technology, product delivery, business, customer service and accounting. These allow you to get your business up and running quicker and cost-effectively than if you were going to do this on your own. Think of all of the time and money youll save by not having to reinvent how you operate your business. Youll get time-tested systems.

Most mobile-storage franchises will handle many of the important aspects of a franchisee's business, allowing them to focus on other necessary day-to-day business activities. The things they do on behalf of their franchisees help them save time, money and resources.

What to Expect as a Franchisee

Franchisees are expected first and foremost to provide the necessary capital to operate the business. Theyll have to do local face-to-face marketing in their territory to develop long-term referral partners. Franchisees need to provide customer support at the local level and, finally, they need to deliver the service and operate the storage facility.

Financing is available to franchisees, allowing them greater access to capital to grow their business. As a franchisee, you purchase the rights to an exclusive market for 20 years. A typical market is a population of 500,000. Mobile-storage franchisors are looking for entrepreneurs interested in building a successful business.

Before jumping into the mobile-storage industry, first consider your long-term goals. Are you looking to add a few customers or start a standalone business? Once you know what kind of service youd like to provide, do your homework. Find out what mobile-storage operations already exist in your market, and talk to a variety of vendors so you can compare pricing, operations, container and delivery systems, and support. The mobile-storage industry is growing every day, and can be great source of revenue for entrepreneurs looking for their next business venture.

Robert Vespa is chief operations officer for Mango Moving LLC. He also serves on the board of directors for the Mobile Self-Storage Association. He has 20 years of experience in the moving and transportation industry. To reach him, call 888.330.0801; visit www.mangomoving.com. For information about the MS-SA, visit www.ms-sa.org.

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