The Ultimate Guide to Starting a Self-Storage Business
Starting a self-storage business can be an incredibly exciting and rewarding endeavor. With how quickly the industry is growing, there is no better time to take the plunge and open your own facility (or continue to grow your existing one). However, your business will not just appear out of thin air. It will take plenty of work in the form of planning, preparation, and execution to get your self-storage business off the ground. To successfully break into the self-storage industry, it is critical that you have a plan of attack. That’s why we’re here. Let’s learn more about how you can best begin or continue your entrepreneurial journey by starting or growing a self-storage business.
Understanding The Storage Facility Industry
Whether you are new to the self-storage industry or have been involved for years, it’s critical that you start your growth journey by developing a robust understanding of the larger market. Familiarize yourself with relevant trends the industry is experiencing, whether that be climate-controlled units, mobile storage units, eco-friendly facilities, or advancing technology that makes life easier for operators like yourself, and your tenants. The industry is ever-changing, and for you to successfully enter the industry or expand your presence in the space, you will need to be on the cutting edge. We recommend you regularly read Inside Self Storage Magazine, Mini Storage Messenger, and Self Storage Talk (just to name a few) to ensure you continue to develop your knowledge of the industry. These are outstanding resources for staying up-to-date on trends and getting advice from long-time professionals. Of course, be familiar with the different kinds of storage facilities as well. If you are starting from scratch, know which category you want to enter. Are you specifically looking to create or scale an inside storage facility, an outside facility, or a drive-up facility? The nuances of your particular build will impact your plan downstream, so keep this in mind!
Conduct Your Market Research
Once you have a nuanced understanding of the self-storage market as a whole, you can start to dive into some market research. Research what people’s needs are when they start using a facility, and develop an intimate understanding of what your customers value. What does your ideal customer look like in terms of demographic and psychographic factors? What’s their age, income, life situation, etc? Put yourself in their shoes, and ensure you are providing value. There’s the numbers side of the equation as well. How many people that fit your target persona exist in the area of your planned or existing facility? Before you break ground, ensure you are doing so in a place where there is a market for your services. Additionally, take a look at your competitors, and analyze their strengths and weaknesses. How do they price? What is their core value proposition? Figure out how you’ll want to position your facility in the larger market. What is going to make you better and different? If you cannot answer the question of what is “better and different” about your offering, you likely need to reevaluate your position in the market. A great resource for conducting market research and familiarizing yourself with the industry is the Self Storage Association. Attend their conferences and events, talk to folks in the industry, and keep tabs on their website. We are certain you will learn a thing or two.
Develop Your Business Plan
A comprehensive business plan is your best friend when you are starting a self storage business. Your business plan will codify your goals, spell out how you plan to get there, and contain all the relevant research you have put into both the market as a whole, and your specific business. Start with an executive summary that provides a general overview of your business. If you can’t describe your business (what it offers, who it serves, and why it is great) in five or so sentences, you are dropping the ball. Follow that up with your market analysis. Where will you operate, how many potential customers are in the area, and what do your startup costs look like? Next, make sure to codify all of the research you have done into your competitors. Make it clear why your self-storage business is different and better, and treat that value as your north star. Of course, your business plan must also take into account the specifics of your location, including square footage, number of units, facility type, and start-up costs. Be sure not to neglect the operational/management side of your business as well (more on this later). Who will manage the day-to-day tasks? Who will review financial statements? Make sure you have a plan of attack for every aspect of your business, and that this plan is codified.
Location, Facility Design, and Layout
When starting a new self-storage business (or growing your existing one), you’ll need to consider your specific location, and how you want to design your facility. This will be a massive part of your business plan. Let’s start with location. Choose a location that is easily accessible and visible from main roads. Consider proximity to residential areas, commercial centers, or college campuses to ensure a strong potential customer base. Of course, your business plan should evaluate the local market demand for storage facilities and assess the competition in the area. Check local zoning regulations and obtain the necessary permits and approvals for constructing a self-storage facility. Familiarize yourself with any specific building codes, restrictions, or guidelines that apply to your chosen location. Additionally, work closely with your engineer to determine the exact buildable area, account for any grade changes, and ensure the viability of your plan from an execution perspective. Of course, you’ll need to know what kind of facility you would like to build. If you are building in a metropolitan area, a multi-story building will likely be your best option. If you have the land available, a drive-up facility is a great path to head down. Make sure you consider local factors as well. If you are building a drive-up facility in a northern climate, make sure you have somewhere to move snow. Ultimately, your layout and design plan should maximize the use of available space. Consider the size and number of storage units, along with the possibility of offering climate-controlled units. Determine the number of floors or buildings required and ensure convenient access for customers, including sufficient parking and loading areas. Don’t lose sight of customer experience in your planning process. The ultimate goal of your facility is to provide your customers with a smooth, seamless storage experience. Another critical element you need to consider is security. This is of utmost concern to your customers. No one will want to store their property in a facility they don’t feel is secure. Implement robust security measures to protect customers' belongings, including security cameras, gated access control systems, proper lighting, and perimeter fencing. Consider additional security features such as individual unit alarms, on-site management, and security patrols. We have some excellent gate and access control partners if you want to ensure robust security at your facility. Your facility planning should be closely tied to your business plan. Determine the initial construction costs, ongoing operational expenses, and potential revenue streams. This should culminate in a feasibility study, and obtaining any financing (if needed).
Select Your Software
The decision of what software you will use to manage your self-storage business is one of the single most important decisions you will make when starting or growing your business. You and your software are attached at the hip. If your software isn’t up to par, your service won’t be either, and you will have a hard time signing on and retaining your customers. Remember, customer experience is everything. When selecting software, keep an eye out for the following features: -Cloud-based/mobile accessibility -Comprehensive reporting -Advanced security -Online rental/E-Signatures -Revenue automation -Built-in CRM -Automated gate partners If you are looking for a software to power your new or existing facility, we can help. Storage Commander is the industry’s leading self storage software solution, meant to simplify your operations and ensure your business is running as efficiently as possible. Our cloud-based solution enables you to manage your facilities on the go, and is priced to fit any budget. We have been in the industry for over 20 years, and we’ve learned a thing or two about how to run storage facilities, and what features your facility needs. If you still have questions as to what features your facility should value when selecting its software, check out our eBook discussing the five most important features you can find in a self storage software.
Operations and Management
When starting a self-storage business or opening a new location, make sure you place a keen eye on the operational and management aspect. What kind of staff will you need? Begin the hiring process and ensure you have a top-notch team in your corner. Invest in any training they may need, and ensure they are fluent in the software solution you select to power your business. Consider improvements you can make to customer experience, such as self-service kiosks. These are tremendous tools for making life easy for your customers. If you are looking for kiosk providers, we encourage you to check out some of our preferred vendors. Look into the payments aspect of your business as well. Does your software solution enable you to easily collect payments from your tenants? Storage Commander’s SC Pay tool makes accepting payments easy both for you and your customers. What will happen when someone calls your business? Does your prospective location have staff on hand to answer incoming calls and handle any questions or troubleshooting? Consider working with an outsourced call center or support team that is fully dedicated to serving your customers. Ensure you have a solid way to communicate with your customers, and maximize engagement. Maintaining open lines of communication is critical for creating trust between your facility and its customers. Make sure you have a robust tenant communication solution in place before starting your self storage business. Inventory management and maintenance is another important piece of your operational puzzle. A storage business that cannot successfully manage its inventory and ensure high-quality maintenance is failing its customers. Don’t be one of these businesses. Lastly, consider any additional revenue streams you can add to your facility such as - Vending machines - Storage insurance - Mailboxes - On-site shop selling packing supplies - Cleaning and weatherizing services for vehicles, boats, etc. Your customers will appreciate additional amenities that make their lives easier, and improve their experience at your facility.
Become a Marketing Wizard
Now that you’ve established your new facility, it is time to focus on growth, and spreading the word on your new venture. In order to effectively grow your self-storage facility, you’ll need to become a master of marketing. This starts with your website. Your website should fit your brand’s ethos, be easy to navigate, and communicate your expertise. Too many businesses make bad first impressions with a lackluster website. Don’t be one of those businesses. Your online footprint has a massive impact on your ability to win business, and be respected in your field. If you need help with creating a great website for your self-storage business, we can help. In addition to an industry-leading software, Storage Commander also offers website design and SEO services to help your business make the best first impression possible and improve the digital visibility of your business. It is critical to not only leverage marketing to make yourself known, but to drive new business as well. You should manage distinct marketing campaigns with each of these objectives, and pursue a variety of channels to enable you to reach your target audience. Before moving forward with a channel, think to yourself, can I find my customers here? If the answer is yes, move forward. If the answer is no, look at other options. To get started, we’d recommend running local Google Search ads to show to anyone searching for storage in your area, as well as pursuing other channels like Facebook where your target audience may frequent regularly. Additionally, be active in your community. Partner with local businesses, and consider running ads in local publications to make your business known. When people think of self-storage, you want them to think of you first. To build your brand and provide value to your tenants (and the industry in general), your facility should also create marketing collateral and content such as blogs, brochures, and infographics. Your content should speak to your customers, and make it clear that you are a trusted, experienced voice in the industry. If you are struggling to get your marketing initiatives off the ground, we have a great team of partners you can work with to help get you where you need to be.
Let’s recap what we’ve learned! You should start your self-storage journey by doing extensive research on the industry as a whole and understanding what trends your new facility needs to take advantage of. Next, consider your place in the market. Develop a distinct brand identity, and understand where your facility fits into the environment you’ll be operating in. Then it is time to get your hands dirty and create a comprehensive business plan. This business plan should consider every detail of your proposed facility, from location to facility type, to start-up costs. Leave no stone unturned. Then, select your software. It is critical you get this right, as your software is the engine that makes your business go. Make sure you consider all of the operational aspects of your business as well, from staffing, to training, to customer experience. The last step is to develop your marketing strategy. Once you’ve established your brand identity and what your facility will look like, it is time to share that idea with the world. If you are embarking on the journey of starting a self-storage business or growing an existing one, we can help. Storage Commander Cloud is an intuitive, easy-to-use software that makes running your self-storage business easy. We understand what it takes to run a successful self-storage business, and our software has all the tools you need to excite and delight your tenants. If you’d like to learn more about how Storage Commander can power success for your facility, we encourage you to schedule a free demo!