As a self-storage operator, you have a captive audience when it comes to retail merchandise. Most people who enter your office are in the process of packing. Whether they’re relocating, downsizing or using self-storage for a life change such as a divorce, death in the family or new baby, your customers are uniquely amenable to the idea of buying boxes, locks, tape and other moving-related items. If you’re looking to increase your ancillary profit stream, don’t miss this opportunity to meet and capitalize on their needs!
But what if you don’t know the first thing about operating a successful retail space? If you’re already running a busy storage facility, designing a merchandise area, choosing inventory, determining prices, and selling and marketing new products can feel like an entirely new business. Don’t worry! Retail doesn’t have to be a massive undertaking. Consider the following and start today.
Before you start ordering products (we’ll tackle that in a bit), look at your potential retail space. Most likely, it’s part of your management office, and you need to work with what you’ve got. How much room can you devote to this profit center? It’s important to use exact measurements, so consult a blueprint or take them yourself. You’ll use these to order your own displays or provide them to a retail-supply company, as it may be able to help with design.
What if your available space is quite small? No problem. You can still have a comprehensive inventory of moving and packing products. The solution is right under your nose: Use a storage unit! You can display a few key products in the office but keep the bulk of your inventory out of sight. You can even use a poster, digital display, or binder with photos and descriptions to show customers what’s available. Once they’ve selected what they want, you simply gather their purchases from the unit. Even facilities with no office space can still operate a thriving store using this method.
Just remember that a successful store is visually appealing. Think about the last time you walked into a retail space. Was it well-lit and organized? Follow these simple tips to keep your store clean and inviting:
- Avoid harsh, fluorescent lighting.
- Keep all products in their proper place. Use downtime to organize any items that are out of order.
- Dust and sweep the area regularly.
- Make sure products are well-marked. A customer shouldn’t have to ask how much something costs.
- Consider using digital signage to reduce paper clutter.
- Consider playing music over a speaker system, but choose something isn’t polarizing or distracting.
Use these two words your retail mantra: Start slow. No matter what your product supplier says, there’s no need to offer all the bells and whistles right off the bat. At first, you only need basic items such as boxes, locks, tape, box cutters, bubble wrap, packing foam, labels and tape measures. Then track which items are popular and ask customers what other products they’d like to see. From there, you can determine what to order in bulk and what to add.
Once you’re ready to expand your offerings, consider items that are related to your local market or other services you offer. For example, if you offer RV storage, you could sell levelers, holding-tank treatment and antifreeze. If you offer wine storage, you might sell bottle keys and stoppers or glass decanters.
Think about the last time you bought a pack of gum from the grocery store. You probably didn’t go to the store with the intent of buying gum. You went to get things you needed and then, while waiting in the checkout line, you saw the package and thought, “Sure, why not?”
Quick-sale items are often referred to as “impulse buys,” and you can certainly work them into your self-storage retail plan. Keep low-cost, enticing items by your register so customers can easily grab and add them to their order. They should be inexpensive, so customers can justify purchasing them. Options might include gum, candy, markers, packing tape and box labels.
Pricing is all about balance. You need to strike an equilibrium between capitalizing on your captive audience and establishing fair, attractive prices. Yes, you can markup products by as much as 100 percent on the wholesale price—for example, if a lock costs you $7, you can charge $14—but don’t get so carried away that you deter customers from buying. If you’ve ever forgone a drink at a concert because the bar was charging $12 for a beer, you know where this line is. Anything over $20 is going to start turning people off.
The key to any profit center is to view it as an add-on rather than an essential. Your primary focus should always be your self-storage offerings. With that in mind, don’t be discouraged if your retail space doesn’t generate a massive amount of revenue immediately.
To increase sales, incorporate your retail offerings into your self-storage sales presentation. Mention the items you sell to new and existing customers. You can also offer specials, such as a discounted lock to a new customer or a 20 percent coupon on retail purchases as a thank-you for a long-term tenant. This will put your retail space in customers’ minds and make them more likely to purchase moving and packing supplies from you.
Customer service is also crucial to increasing sales. All employees should be trained to mention products during the leasing process and know the ins and outs of your retail offerings. For example, every team member should be able to explain the benefits of various locks and recommend products for storing certain items.
The bulk of your retail revenue will come from tenants, but don’t limit your customer base by neglecting to market to the community. Post signage outside your facility that clearly promotes your retail center to the public, letting them know you sell moving and packing supplies.
In addition to this curbside marketing, use social media. You can also write a blog on your facility’s website related to retail products. For example, you might create a post on how to store a mattress in which you mention that your facility sells mattress covers.
Lastly, if possible, put your logo on your retail products to increase brand awareness. Many retail suppliers are willing to assist with this.
When introducing merchandise at your storage facility, start slowly, stay aware of which products are popular in your market, and be proactive about getting the word out. Having retail space is a great way to garner more revenue without dramatically increasing your overhead. It’s also a smart way to increase the value of your self-storage business by upping your net operating income. Whether you go big with an expansive store with specialty products or stick with the essentials, it’s easy to find success.
Krista Diamond is a staff writer for StorageFront, which allows customers to custom search and compare thousands of self-storage facilities. She’s a graduate of the University of New Hampshire and lives in Las Vegas. When she isn't writing about storage, she’s climbing mountains in the desert. For more information, visit www.storagefront.com.