Sterling Management Services

October 1, 2004

4 Min Read
Sterling Management Services

Sterling Management Services

Matching properties with profits

By Kimberly Hundley

When Sterling Management Services takes on a new project orproblem-child facility, you can be sure it wont resort to a one-size-fits-all solution. Instead, each propertys distinctive qualities will beembraced and exploited. Its this philosophy thats led to Sterlingsvirtually flawless record of transforming underperforming sites into profitcenters.

We dont aspire to emulate the big guysand Im notmocking the big guys, says Sarah Even, owner of the Boynton Beach, Fla.-basedcompany. For example, I have tremendous respect for Shurgard. But they haveformats. They operate just like a McDonalds: Everywhere you go, youll getthe same hamburger.

The giants may be able to operate that way, Even says, but theopposite is necessary to create a different image and niche for smalleroperators. For every one of our projects, the image we project to thecustomer and the general public is unique. We match the profile to themarketplace.

A full-service management company, Sterling offers a suite ofmanagement services for start-up and existing self-storage companies. Clientscan mix and match from such offerings as marketing, operations, onsitesupervision, staffing, accounting and payroll. Most, however, opt for full-service management, with Sterlinghandling operations, policies and procedures, hiring, training and repairs.

We do consulting and facility tune-ups, says Even, whofounded the company in 1989. After guiding several facilities into the blackwhile working for a national market-development company, Even dedicated hercareer to the industry. Well give an analysis of managers and customize atraining program to maximize the skills they have behind the counter. Welleven train an owner to run his own property.

Property Diagnosis and Cure

Thanks to its staffs expertise in accounting and managementsoftware, Sterling is well-positioned to detect costly mistakes owners may notrecognize. Case in point is one of the companys recent clients: a newcomer tothe industry, he appeared to be doing everything right, beating the competitionhands down in terms of quality. Yet hed also gone through five sets ofmanagers within a year and was consistently overstaffing. After studying thebooks and facility setup, Sterlings team discovered the hidden fatal flaw.

I said, You know what? You dont understand how yourmanagement software works, and neither do your people, Even relates.As a result, youve taken this program, and instead of having 10different unit types, you have almost 200. Nobody has supervised how to do adiscount 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 indiscounts; but, in fact, youre giving away $13,000. Because you dont knowit, youre not doing anything about it, and youre overstaffed as a result.

For all its advantages, management software cant impart thebenefits of practical know-how. Most everybody gets good at what they do bymaking mistakes. So I guess you are flattening out your learning curve byhiring a company like ours. Youre hiring our experiences and avoiding themistakes we made to get where we are now, says Even with a good-natured laugh.

Even enjoys the challenge of diagnosing and curing propertiesthat arent living up to their potential. Perhaps thats why Sterling excelsat returning seriously distressed facilities to profitability within one yearand significantly improving the performance of below-market facilities.

Nothing Magical

Take, for instance, the older Fort Lauderdale propertyrecently delivered to Sterlings hands. The two-story storage facility had noelevator, had never rented an upstairs unit, and was bordered by a busyinterstate and a railroad area frequented by homeless people. Occupancy sat at40 percent and delinquencies above 50 percent. Maintenance was so poor, thelight 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 rentersproperty to the previously undesirable upstairs units. Appropriate marketing wasalso executed.

A national management company had been running the facilityfor a year and passing on beautiful reports that said why it wasnt performingwell, Even says. Within nine months, we had it 100 percent occupied. Itwas nothing magical. We are willing to get our hands dirty and concentrate onthe 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 iscareful to protect its niche by remaining selective. Our approach is to putthe clients interests above our own, Even explains. We wont takemanagement contracts if a facility is within 10 miles of another project we arerunning because it compromises our focus. And we dont do consulting in thesame market.

Sterlings fee may be less than many expect. The minimummanagement fee is approximately $2,500 a month against 6 percent of the grossincome, 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. Ithink were very affordable.

In addition to its management services, Sterling offersfeasibility studies, site evaluations, training programs and manuals formanagers, middle managers and owners, and more. For more information, call800.403.0062; e-mail [email protected]; visitwww.sterling-mgmt.com.

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