The self-storage sector has been booming, and with rapid growth comes change. Facility operators have been expanding, raising prices and adding technology. They’re also facing inflation, wage growth and labor challenges.

Though we’ve seen a great deal of consolidation in the last two years, the storage industry is still largely comprised of independent facility owners; and they often lack the resources to handle large-scale growth and change, particularly on the staffing side of the business. It may not be feasible for them to hire human resources (HR) manager and payroll administrator—two roles that can have a significant impact on bottom-line value. Outsourcing may be the answer.

The Benefits

One of the main benefits self-storage operators enjoy when outsourcing their HR functions is savings. Salaries for HR and payroll positions can range from $50,000 to $100,000 per year. Outsourcing comes at a significantly lower cost.

It also helps you manage your workforce more efficiently. Outsourcing firms have systems, procedures and templates in place to support your business in the following:

With periodic changes in laws around safety, labor, workers’ rights and other matters, HR firms can provide you with peace of mind. They closely monitor the latest laws and best practices so they’re ready to provide expert advice on regulatory issues, workplace accidents and even lawsuits. Self-storage operators shouldn’t have to burden themselves with these responsibilities. They should focus most, if not all, their time on sales and customer service.

The Options

There are several types of HR support available to self-storage businesses. Below are the four main ones.

Consulting firm. This works best for businesses that need limited assistance or support with a specific HR issue. A consultant can help you identify problem areas or weaknesses and then work with the you to develop a resolution plan. Once the issue has been addressed, the partnership ends.

HR technology vendor. Some self-storage operators have the infrastructure and resources to manage their HR functions internally but lack the tools to do so efficiently. In these cases, they can engage a technology vendor to provide access to an HR program or platform. Payroll processing is the task most frequently managed this way, but you’ll still have do most of the heavy lifting.

HR outsourcing (HRO) firm or administrative services organization (ASO). If you need more expertise or ongoing service, consider outsourcing some or all of your HR functions to an HRO firm or ASO. The provider can take over one or more designated tasks including payroll processing, benefits administration, regulatory compliance, etc.

Professional employer organization (PEO). Companies looking for a full-service solution often choose to partner with a PEO, which performs all the core functions of an HR department and provides strategic guidance on related matters. It also allows you to access to less expensive health and financial benefits for employees.

With a PEO, you enter a co-employment relationship and name the company as the “employer of record” for your team. This designation allows the provider to perform employment-related tasks on your behalf, like procuring and administering health insurance and other benefits, filing payroll taxes, and managing unemployment insurance claims.

The Costs

When a self-storage operator considers outsourcing parts of their business, cost is always a factor. To put things into perspective, the average mid-sized business that handles HR in-house spends $4,500 per employee, per year on related functions. Depending on the level of service and number of employees, the price range for outsourcing typically ranges from 3% to 8% of a company’s total payroll. The cost for PEO services, specifically, is usually anywhere between $100 and $150 per employee, per month. The savings are significant.

Choosing a Partner

With so many HR providers in the market today, you may be wondering how to find the best match for your self-storage business. To begin, consider the size of your operation and any future plans.

If yours is a steady, slow-growth business, outsourcing firms that offer á la carte options allow you to farm out a few select functions while retaining others. As your company expands, you might decide that you need different services or more of them. There’s flexibility with this model.

If your business is dynamic and experiencing fast growth, you may need more strategic services to support your objectives. PEOs deliver the comprehensive services a company needs to accelerate. In short, if you have lofty goals, a PEO may be a better option.

Whichever type of HR partner you choose, here are two things you can do to ensure the collaboration is a success:

Is It Time?

So, are you ready for HR outsourcing in your self-storage operation? If you still aren’t sure, ask yourself these four questions:

If you answered yes to some of these, then maybe it’s time. Once you’re engaged with the right partner, your headaches and worries regarding HR will rapidly disappear.

John G. Allen is the chief revenue officer at G&A Partners, a professional employer organization that has been helping entrepreneurs in all industries grow their businesses for more than 25 years. For more information, call 888.392.1226.