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Who Should Own Self Storage?



Who Should Own Self Storage?

Who Should Own a Storage Authority Franchise?

Entrepreneurs

who want a solid real estate investment for both income & retirement.

Business Owners & Professionals

who want to build a second reliable six figure Income.

Families

who want a retirement they can count on and a generational business.

Couples

who want to have a business where they can work together.

Self Storage Owners

ready to take their business to the next profit level and crush the competition.

 

Why doesn’t everyone take advantage of the Storage Authority opportunity?

Because 99 percent are waiting for the “right time” to start a business.  They are waiting for the perfect business.  Don’t believe me?  Just tell your neighbor you are going to build a self storage and they will tell you how lucky you are and  “I was going to do that but………………..”

So that leaves us with the 1 percent who Declare “now is the time.”  They took the time to research self storage and understand self storage is  a solid business that can provide both a great income and a great retirement income.  And they are ready to work to make it happen for them.

Self Storage development is just hard enough to keep it very profitable.  Typically it takes $400,ooo liquid cash equity to get started.  And takes time and work to get it built and profitable.  Storage Authority Makes Self Storage Easy.

If you are a 1 percenter we would love to talk with you.

To Success!

Marc Goodin

Founder & CEO Storage Authority

860-830-6764 direct

 

Our Founder Marc Goodin Shares his Self Storage Secretes in the April ISS Issue

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Storage Authority President Marc Goodin  Shares Self Storage Secretes 
By Garrett Byrd
Our Founder Marc Goodin continues to share his secretes and knowledge with the self storage Industry.   His latest article entitled Customer-Centric Sales Techniques, Strategies for Creating Value and Trust is in the April 2017 edition of the Inside Self Storage magazine. Here is the link to subscribe now https://goo.gl/EkS1za
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Storage Authority Franchising is about owning your own hometown self storage business. And having the professional systems and knowledge to assist and guide you. We like to say You are in business for yourself but not by yourself.  If you are thinking about self storage you owe it to yourself to contact Garrett Byrd at 941-928-1354 or Garrett@StorageAuthority.com to learn more about the Storage Authority Franchise opportunity.

www.StorageAuthorityFranchise.com

Target Markets for Self Storage

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Target Markets for Self Storage

By Garrett Byrd

 

Below is a list of self storage target markets where you want to consistently cross market with and bring awareness to your services and brand.  Start by setting up your calendar and reaching out to your target market with a visit at least every 90 days, you can call and email as well but the face to face visit is the most impactful.  The key is staying consistent and making it part of your, daily, weekly, and monthly routine.  If you want to be the home town self storage, you must make an impact in your three-mile radius.  When you are helping, your local business grow their business your facility will fill up exponentially with referrals.  With Storage Authority, we have the systems and we will show you how it’s done.

 

Moving Companies, Truck Rentals (that don’t provide self storage) & Senior Move Managers –

Co-operative marketing and referral partnerships opportunities

Real Estate – Realtors / tittle companies / mortgage/ Home Inspectors / Staging / Designers

Great for cross marketing

Apartments / Condo HOA’s –

For their move in Packages – Self Storage Rack Cards with coupon for move in packets, helps leasing consultants  overcome objection of downsizing to apartment.

Senior Communities – 55+ Mobile Homes / Assisted Living & Independent Living

Do they do move in Packages?  Resource Center?

Senior Care Providers – like home health care services.  Cluttered homes are a safety hazard and they can recommend storage is they don’t want to part with the items.

Child Centers – Day care /After School/ Recreational like: ballet, karate, sports: – Families need storage

Restoration Companies/Disaster/Construction Companies – Emergency cleanup and store items able to salvage while home is being restored.

Pharmaceutical Reps—They will target climate control units that is central their distribution location, that will receive packages for them and store their sample drug inventory, marketing materials and literatures

Insurance Companies –

Auto/Boat/RV –  (their clients may need a place to store these)

Homeowners – Buying/Selling – they call their insurance provider – may need temp storage or downsizing

Bankers and Attorneys—They are a perfect source for referrals and often need your self storage services for time sensitive record keeping complying with their industry regulations.

Schools – Public & Private / Elementary – High – Families & Faculty need storage

What marketing opportunities with local school to participate in

Teachers – Teacher Lockers to store supplies during the summer and keep home clutter free

Colleges – Focus April & August – Student Flyer – Students use storage between summer semesters.  Lockers during school year to keep personal items locked up.

Funeral Homes/ Crematoriums

– Families need quick storage to clear out house for sale, time to grieve and then go through stuff and decide keep or give away.

Local Businesses / Restaurants / Dr. Offices / Retail / Thrift Stores – store extra inventory, business records, catering supplies

Laundromat, pizza places, etc.  Look to see if they community boards, place to put our display – Get lots of traffic.

Home based businesses – HVAC/Sales/Accountants/etc. – We accept package and deliveries, store inventory, equipment, business records,

 

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Storage Authority Franchising is about owning your own hometown self storage business. And having the professional systems and knowledge to assist and guide you. We like to say You are in business for yourself but not by yourself.  If you are thinking about self storage you owe it to yourself to contact Garrett Byrd at 941-928-1354 or Garrett@StorageAuthority.com to learn more about the Storage Authority Franchise opportunity.

 

www.StorageAuthorityFranchise.com

 

 

Three Must Do’s for Over the Top Success while Pre-Marketing your New Facility.

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Three Must Do’s for Over the Top Success while Pre-Marketing your New Facility.

By: Garrett Byrd

 

1.)       As soon as you have closed on the parcel you will be building your self storage facility make it a point to get your self storage coming soon sign up.  Make sure you get permission and adhere to the city/county rules and regulations with signage. This will be your introduction to the community for the next six to eight months so make sure your hello to the community stands out and is inviting,  remember less is more on a quick drive by sign.  You will want to have your  phone number on the sign where your future customers can  call and receive information  or leave their contact information phone and email to be put in your data base for your facility updates and progress.   It’s a good idea to have your website on the sign as well, even if your website is in the beginning phase it’s nice to have a place where your customers can receive basic information as well as register their interest as your site progresses.  As soon as you have temporary electricity, make sure you have spot lights or even Christmas lights on the sign.  It’s the 15,000-30,000 cars driving by your parcel that well be your future customers you want to be as visible to them as you can. The average facility has 15-20 rentals and reservations, Storage Authority’s goal should is to have 50-60 hard reservations or rentals before you open your doors. If this isn’t your goal you are likely losing out on $60K in income your first year due to poor pre- planning.

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2.)          Join your local chamber and real estate associations.   When you join these types of associations you must be involved and you should network all angles.   You are networking, it’s not net-eating, net-socializing, or net sitting, it’s networking and you have very little time to make connections and utilize each other’s platforms to generate new business.  For your local chamber, you want to attend as many events as you can, let them know your facility will be open soon.  Business card exchanges luncheons, support any grand openings for your fellow chamber members.  It’s important that you let them know you care about their growth just as much as you care about your facility’s growth.  It’s the law reciprocity, people feel a sense of obligation to do something for you when you’ve done something for them. Help your fellow businesses achieve their goals and it will pay dividends to your facility’s growth.  The realtor associations are important as well, self storage is a transition business and  realtors are constantly in front of their clients who are on the move and in need of storage solutions. The realtor associations usually will let you sponsor their training classes for a luncheon or brunch.  They will allow you to set up a table and give a five-minute information pitch about the self storage services you provide.   Be sure to have some branded give a ways (totes, pens, marketing material) for the realtors and let them know you have a realtor resource center at your facility to help promote their business.  Ultimately the realtors want to know if they are referring your self storage facility their clients are going to have a first-class experience.

 

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3.)      Community outreach to your local businesses with in your three-mile radius.  This is critical to do before you open your doors.  You want to prepare yourself with a branded marketing tote and have your marketing material in your totes along with a pre-leasing discount.  Your objective is to visit all businesses in your three-mile radius, let them know your facility is opening soon and leave them a tote.  You also want to take their business card as well and learn as much about their business as you can in your short visit.  The key is to get the local businesses card for your contact list and let them know you hand one of these totes out to every new customer.  You like to help to promote your local businesses so you include a coupon to their business to bring awareness to their brand.  Let your fellow business owner know you are a transition business some of your customers are new to the area or on the move.  There is no fee to promote their business with you all they should do is give you a stack of coupons to stuff in your totes.  You always want to keep a master coupon with their business card, when you run low on their coupon you can give them a call and they will gladly swing by to deliver more coupons for you and thank you for handing them out.

 

Storage Authority Franchising is about owning your own hometown self storage business and having the professional systems and knowledge to assist and guide you. We like to say You are in business for yourself but not by yourself.  If you are thinking about self storage you owe it to yourself to contact  Garrett Byrd at 941-928-1354 or Garrett@StorageAuthority.com to learn more about the Storage Authority Franchise opportunity.

 

www.StorageAuthorityFranchise.com

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$3,000,000 In Your Pocket for Being an Expert!

 

How Much is it Worth to Be Prepared For

Your First Year as a New Self Storage Owner? 

 $3,000,000.00?

By Marc Goodin  

 

If owning self storage is so great, why doesn’t everyone do it. Because It is just hard enough to keep the average person dreaming on the sidelines.  The good news is the barriers to entry continue to make it one of the best real estate investments to make both a great income and build a great nest egg while you have the option to keep your career. Heck most people will not even get to the end of this article, never mind start their own business.

So, the next two questions are:

1) Why is it worth millions to be prepared? As you read the rest of this article you will learn why.

2) Why are most self storage not prepared in their first year and often never reach the premier status they could.  The answer to this second questions is it takes time and knowledge to be prepared and the typical new owners simple do not have the time and experience.  Like most businesses, Self storage is unique and takes time to learn.

It took me 4 years of engineering college and two state tests to become a Professional Civil Engineer.  It took me 10 more years to become an expert in site plan designs.  And then it took me 5 more years to be an expert in civil engineering sales and marketing.  For the first 10 years, I was paid for my time, staring at $50/hr. and ending at $250/hr. But after I was both and expert engineer and expert at (engineering) sales and marketing I was paid for my knowledge and not just for my time. Of course, this provided financial success significantly more than trading dollars for hours.  Believe it or not the same goes for most businesses including self storage.

It took me 6 months to build my first self storage and become a self storage owner.  It took me 10 years to become a self storage expert and then 5 more years to become an expert in self storage sales and marketing (Over 10,000 hours) So when I say new owners do not have the time or experience to be prepared I am really not kidding.

Let’s take a look at those millions typically left on the table by most self storage owners.  For this example, I am going to use a 50,000-sf foot facility with 420 units with the average unit rental rate of $150/month.  For comparison, the average facility in the US is 67,000+_ sf and of course has more units.

I looked at several recent self storage feasibilities studies by the experts and they predicted rent up to 90% between 24 to 42 months. Typically, around 4-5% per month for 20 units a month.  Last week a self storage that just opened 4 months ago shared his first 3 monthly rent up stats with me and he rented 15 units a month.

With the right design, premarketing and team in place on opening day you should aim for 60 plus units rented in your first month.  If you use a conservative 12-month average stay each extra rental in your first month is worth $1,800 a year.

The first 20 extra units: 20 unit’s x 12 months’ x $150 monthly rental = $36,000/yr.

The second extra 20 units (60 units total) the 40 extra rented units’ value is $72,000/yr.

Done right the second month can be a repeat of month one in extra rentals compared to the average.  So why is the typical so low.  Again, because the new owner cannot tell you the 25 design elements or the 50 pre-opening and 50 post opening sales and marketing items required for these over the top results, never mind the secret sauce on how to execute them. Can you name them?

Typically, a new self storage facility opens with a manager who does not know how to sell and rent for over the top results.  At worst, they are order takers, at best they are good customer service agents, neither will get you past the typical results.

Once you are past the first couple of months the number of move outs increase every month.  And the increasing the facility visitors and renters becomes more critical.  Just as important, is these extra rentals can reduce the rent up period by a year or even more!  For a typical 50,000 sf facility of 420 units, 90% rented = .9 x 420 units = 378 units rented.  If you use the average stay of 12 months that means at this 90% full equilibrium point you have 378/12 = 32 move ins and 32 move outs every month. In other words, your job of attracting prospects and converting them to renters never ends.  So why not make sure you and your manager has all the tools before the grand opening.  The simple answer is this information and education is not often available to the manager and owner.

I am sure you would agree: With the 6 months pre-opening sales & marketing training and assistance and 52 weeks of new learning and implementing of new sales and marketing techniques in your first year you could significantly increase your rentals which would also lead to more rentals every year.

Would you believe or consider:

Training must start by collecting the low hanging fruit.  A sales and marketing manual, rental scripts, pre-opening rental program, two dozen rentals must do items, manager training, manager help hot line, along with more sales and self storage basics and you could increase your rentals by 1 a week.

Low Hanging Fruit: 1 extra rental per week for a year =

1 week x 52 weeks x 12 month stay x $150/month rent = $93,600 income/year.

Mid-level sales and marketing task for a second extra rental a week: co marketing with 15 plus local companies, over the top service, off site marketing & visits, social marketing, monthly marketing plan, secret shopping, warm calls, manager training, on site marketing, and much more

Mid-level training and education for a second extra rental per week for the is another $93,000/year.

And if you hire a sales manager to start with and throw in gorilla marketing and more sophisticated sales and marketing concepts for a third extra rental a week, it  would be another extra $93,000 income/year.

Just as important is these “extra rentals” can reduce the rent up period by a year or even more.

Will most managers or owners take the extra steps required for these extra rentals?  No, they will not even know the extra steps. Do you know the extra steps?  Are they possible with the right people, systems and knowledge? Yes!

Garrett Byrd our Storage Authority’s resident expert on manager marketing was working for a multi-unit self storage group as a manager and manager trainer.  When his company was building a new 3 story facility in 2016 he was chosen to manage and get the new facility off to a fast start.  It did not look easy as another 3-story facility was under construction, just down the road.   But he started with pre-opening marketing and continued his marketing every day.  He rented an unbelievable 80 units the first month and 80 units the second month.  At month 6 the facility was 60 % + rented – Wow.  And at the seventh month we hired Garrett!

Will your manager have even close the same results?  I do not know.  Will they visit (and know how to get referrals) the chamber of commerce, local banks, attorneys, funeral homes, realtors …. or have Santa’s visit during the holidays, beach day at their facility; or will they memorize a great rental script; or take the time to have answers to overcome the 10 self storage objections; or will they hand out candy, flowers, water and coffee to their visitors?   Will they even know the critical 25 environmental factors and 100 plus other over the top customer service required to be a premier self storage?  Can you list them?

If you and your manager learn the environmental and over the top customer service, and implement best management practices for sales and marketing not only do you get the extra rentals you also can be the price leader for additional income.

When a feasibility study is prepared, they determine the average rental rates of your competition and assume you will rent at the average rental rates.  And I have found most new owners actually want to charge less than the average.  With our help our franchisees rates will be 10% higher or more than if they set them on their own.  This means our services are free.  But if you understand you are not in the self storage business and learn how to solve customer’s problems and enhance their experience you can even charge more than 10% higher than the average rates.  You can become the premier facility and price leader. Most managers do not know their job is to find out what customer’s problems are, never mind how to solve them in a fashion that builds trust and rent units.  See my article Three Rental Rate Myths for more details, Where you can see first hand examples of charging 20% and more than the competition.

http://www.storageauthorityfranchising.com/news_room/the-3-big-myths-about-rental-rates/

For a typical 50,000 sf facility with 378 units rented every 10% increase in rental rates = $68,000/year.  Here is the math

378 units –  Average rent $150/unit – 10% higher rent

378 units x ($150 x 0.10) x 12 month stay = $68,000

20% higher rental rates = another $68,000/year

30% higher rental rates = another $68,000/year

 Can you answer why a customer would pay 10%, 20% or even 30% more to rent at your facility?  You need this answer before you start your design. Again, it is a combination of environment, over the top customer service, sales and marketing.  It’s about providing the “just right feeling”.   The typical renter calls or visits 4- 6 facilities, what makes your facility superior?  Your quality, your vault units, your additional unit sizes, your doors are 1 foot wider or higher, your landscaping, you, your manager, your security, your sale office, your sales and marketing, did you notice the customer car or his Boston Red Sox’s shirt, did your manager call a new prospect by name 3 times, did you …………. the list is endless?

I have heard many managers say I want to lower my rates to match the rental rates of the REITS down the street.  But do they want to explain to their customers and friends the $19/month rental rate increase in 5 months and $19 rental rate increase in 9 months that the REITS impose?  It is much easier and more fun to shine bright, surprise and delight your customers!

If you ask most managers what should be done to rent more units, they are going to tell you reduce the rates.  Nothing could be further from the truth.  The price is typically 4 to 6 down on the list why renters choose a specific location.  So, you need to know how to promote the items ahead of price and overcome price objections.

“Marc, I understand your concern about price and that you want to get the best value for your money.  I am sure you can agree with me that Storage Authority has many benefits and services our competition does not have, including the best guarantee in the business and me.   If I gave some of my customers a discount I could not provide the services, they expect and deserve.  Would you like to get that 10 x 10 in your name? I promise to earn your business everyday” There are several other steps and a couple of hours of training to perfect overcoming the price concern.  But in most cases overcoming the price concern is not even needed to rent.

The number one excuse is I do not need it today and this is the simplest one to overcome.   Last week I was checking out a possible new facility location and I called a nearby existing facility to see how full they were and their prices.  I simple asked if they had a 10’ x 10’ I could rent next week.   They had one but could not promise it would be available next week.  I said I could always rent a 10” x 15’ and asked if they had any.  He said he had two available today.  He never asked if I wanted to rent today.  For sure this facility is losing well over a hundred thousand dollars a year because their prices are too low and like most facilities they do not have any idea how to rent over the phone. And typically, of many facilities they do not ask for the rental each and every time!

Did you know you will rent more units priced at $149/month than at $143/month?  People have been trained that prices have been cut back when the price ends in 9.  Did you know you will rent more units at $149 plus tax than the same price of $159 tax included?  Did you know you will rent more units at $149 than at $149.00?  Did you know you will sell more $12.99 locks if the sign says $17.99 Locks on Sale $12.99?  I have been to hundreds of self storages and never seen a lock on sale.

Unfortunately, or fortunately (depending how you look at it) self storage marketing and sales is years behind the hotel industry and the retail industry in general.

If you understand you are in a retail business and not the self storage business you will make more money.  If you understand you are in the people business and the sales and marketing business you will make even more money.  People do not rent self storage because they want self storage. But they will choose you because you understood them, took the time to discover their problem and desires and helped them resolve them and feel better.  As soon as you understand it is not what is between the 4 walls of a storage unit but what is outside the 4 walls you will be on your way to having happy customers willing to pay more for your services.

I recommend you visit 5 self storages and see how many managers show you a unit (half or less I bet.).  Call you by name (none).  Ask the manger the last time they called back a prospect and asked them if they wanted to rent; the last time they visited the competition to make sure they sent prospects their way when they were full; the last time the competition referred clients to them; the last time they visited the local business in the 5 mile radius; the last time they raised their renters rates, the last time they carried free water out to their renters; how many people are on their newsletter list or how often they send out newsletter?, what is their guarantee?, What percentage of renter buy insurance and go on auto pay?, why they sell the cheap unsafe shank locks? or, how many boxes does it take to move a house? …………the list goes on.  Then you will start to have a better understanding of the concepts here. Send us an email and we will send you a check list that will help you understand what you are looking for on your visits.

Call a couple of facilities and let them know you are just getting prices and see if they even try to rent you a unit over the phone.

If these self storages, in businesses for many years, have not figured out how to be premier facilities how is your manager going to figure it out?  It takes an experienced team.

A well set up retail office with the right training will provide you an extra $50,000 a year in what I call manager sales.

You have 32 people moving in every month, so the opportunity for add on value keeps repeating itself month after month!  At most self storage, most add on sales are close to zero.  In fact, most managers are willing to give free stuff like a free lock or dropping the $20 one-time admiration fee or reducing the price at the drop of a hat.

If you consider items locks, boxes & tape, insurance, admin fee a person in the know can add a couple of thousand dollars a month in profits or an extra $25,000 a year and if you stop the unnecessary discounts you have another $25,000 a year

I love customers on auto pay because they save us time (for marketing) Typically only the few who put themselves on auto pay get on auto pay.  Even if asked if they want to go on auto pay say no because most yes or no questions naturally end up with as a no. This one is a no brainer.  It just takes learning the script and techniques mandatory and one hour of training and the proper lease. Because people stay 2 extra months if they are on auto pay an extra 10 auto pays a month is worth $30,000 a year.  As far as I know we are the only one who has this option on the front page of a lease making it easy to present and get a yes at just the right time.  And no extra paper work like every other facility.  Of course, I had to pay a self storage attorney to set it up to make sure we met the law.

One of my all-time favorites is eliminating the crazy “free month” deal.   For our example of 32 new rentals each month at $150 it would be a whopping $4,800 a month or $57,600 giveaway each year.  The REITS have to do this because they have $9/hr. managers and this is the only rental tool they have.

A couple of years ago, I was hired for 2 days to visit a self storage to simple confirm they were not doing anything wrong.  They were making a great income and they were not looking to make any changes that would create more work for them, like better training the staff or sprucing up the office.  In the end to get them to items I knew would make them a ton, I offered to give back my $5,000 fee if they made two changes and if they did not make triple my fee in profits.  The first was to eliminate the first month free offer and the second item was to eliminate the big sign out front “units starting at $9/month and change the price of these small unit to a still great below market price of $39/month.  In six months, the owner called me back and they were making $8,000 more a month because of the 2 changes.

We have reviewed a lot of first year extra income items, but in the end most if not all are important every year, year after year.  If you add them all up they equal several hundred thousand dollars, so of course, it is not very likely that they will all be extra profits. But at least you can understand that they can make you a larger first year income and the ability of renting up twice as fast. And enjoy your business with more profits year after year by building a great team with self storage expertise along with a sales and marketing background.

If you are not ready to do the some of the work yourself and be part of an experienced team, I would not recommend you go it alone.  That leaves you one other choice and that is to give your facility over to one of the REITs to manage your facility.  I believe strongly once you pay for their fees and add on expenses (and often lower rental rates) you will make less money.  If you want to be totally 100% hands off this is a route to consider.

So how do we get to that that 3 million by being prepared.  It simple, let’s cut all those additional incomes back to just an extra $100,000 a year income.  If we assume you own your business for ten years you have the first Million Dollars.  As you may know self storage sell based upon cash flow after expenses.  If you have and extra $100,000 in profits and a 5 cap rate your sales value would increase by $100,000/0.05 = $2,000,000.

If your like me and thinking why not aim for $200,000 or $300,000 of extra income give me a call, we think alike!

Storage Authority Franchising is about owning your own hometown self storage business. And having the professional systems and knowledge to assist and guide you. We like to say You are in business for yourself but not by yourself.  If you are thinking about self storage you owe it to yourself to contact Garrett at 941-928-1354 or Garrett@StorageAuthority.com to learn more about the Storage Authority Franchise opportunity.

www.StorageAuthorityFranchise.com

Marc Goodin is President of Storage Authority Franchising.  He owns 3 self storages he designed, built and manages. He has been helping others in the self storage industry for over 25 years.   He can be reached at marc@StorageAuthority.com or directly at 860-830-6764 to answerer your development, marketing, sales and operations questions.  His bestselling self storage books are available at Amazon.

You should not base any investment decisions on these examples and ideas.  It is strictly for discussions. Many factors will vary significantly based upon any given facility, location, competition, your efforts, experience and time.

This information is not intended as an offer to sell a franchise or the solicitation of an offer to buy a franchise. Certain states regulate the offer and sale of franchises.  If you are a resident of one of these states we will not offer or sell you a franchise unless and until we have complied with the applicable presale filing, registration, and disclosure requirements in your state.

In NY, an offering can only be made by a prospectus filed first with the Department of Law of the State of New York.  Such filing does not constitute approval by the NY Department of Law.  Minnesota Franchise Registration #F7944.   If you have any questions, please let us Know

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Franchise Business Radio – Interview with Marc Goodin, President of Storage Authority Franchising

Name and Title of Person Interviewed:

Marc Goodin, PresidentIMG_3170

Guest BIO:

Marc Goodin is President of Storage Authority Franchising. As a professional civil engineer he has designed commercial developments and self storage facilities for over 25 years. His self storage expertise has been fine tuned by designing, building and managing 3 self storage facility he presently owns. Marcs experience from the trenches and his expertise is apparent in his two best selling marketing and planning self storage books available on Amazon.. Marc is uniquely positioned to provide simple, straightforward and effective guidance in achieving industry-leading service and profits in the self-storage Industry.

 

 

Click Here to Listen to Interview with Marc Goodin, President of Storage Authority Franchising

 

  • Topics/Questions:

  • Why Self Storage for the Busy Professional
  • How to get started in self storage
  • How to double your profits in self Storage
  • Storage Authority

Web Site and/or Social Media Links:

www.StorageAuthorityFranchise.com

Facebook
Twitter
YouTube
https://www.linkedin.com/in/marcgoodin

 

The 3 Big Myths About Rental Rates

The 3 Big Myths About Rental Prices

By Marc Goodin

First I want to show you a chart for the 22 self storages near my Coventry self storage.  As you can see there is a huge difference between the low & high prices and even between the average and the high prices.

Average Rental Rates Coventry & Area
Average Rental Rates Coventry & Area

The high prices are mine and I can tell you increasing your rates 25% will increase your profits by 50% and more!

ONE

You will get more rentals and make more money if your rates are in the middle of the pack or on the low end of the rental scale.

There is nothing further from the truth, in fact I can find the price leaders in any city and they will be the ones making the most money.  There is no other business where the owners (and managers) lack the basics of a retail business (or just are making to much to care or put in the time.)  This can be observed by the fact that so many facilities are full but have not raised their rents (in years).  Have you ever seen another business that would not raise their rates when there is such demand?  These facilities would make more money with higher rates at 95% full.

By providing the tools and training a manager, the sale manager will surprise and delight clients and provide the “just right feeling” and price will not be a factor.  Once you help clients understand and see you are a premium self storage they will be happy to pay for your services

We have the best guarantee in the business and we share it with every customer even before they walk in the door!  They know we care about them and their stuff immediately – priceless!

100% Satisfaction Guaranteed!
100% Satisfaction Guaranteed!

Most owners have let their facility become a commodity by having order takers for managers and not having trained sales managers run their facility.  The difference is not what is between the four walls of a unit but what is on the out side of the walls.  A Commodity is a product or service that no one cared enough about to market and thus has to compete on price.  Marketing and sales managers create value by combining stories, design, care and over the top service.

The problem is it takes experience and work to provide the systems, manuals, guidance and training.  Starting day one I would rather insure managers know how to really explain the price and understand the basic sales and marketing, then literally leave tons of profit on the table every month.  And that is why Storage Authority has developed Dynamic Ease Series for all aspects of self storage.

Our managers are required to email us immediately if someone did not rent because of our (higher) prices and provide their phone number and tell us what they said about price.  After training I rarely get such an email but when I do once or twice a year I love to give them a call and rent to them.

TWO Most renters choose where to rent based upon price.

There is nothing further from the truth, in fact price is often 6 or 7 down on the list. Many managers think price is the major factor in choosing a self storage because this is the first question a prospect often ask.  But customers ask this because they do not know what else to ask.  Competing on price is absolutely the worst feature to use to build a profitable self storage.  During the next 5 site walks to show units have your managers ask prospects what is important to them and price will be down on the second half of the list.

The manager’s simple do not know how to make a sale and in most cases do not even take a prospect for site walk to get to know them or know how to ask for the rental.  People do not window shop for self storage.  Typically, they are going to rent from you or someone else in the next week.

THREE  It is a lot of work to keep up with the competitions prices I don’t really need to do that.

Again a myth.  The competitions prices are simple to get with a few strokes on your key board.  I use www.stortrack.com  I can check the competitions prices when every I want and Stortrack even send me alerts when prices change.  Us our code Price20  and save 20%.  They have a couple of great options to get quick mini reports when you looking at new sites.css 22 stortrac

They provide the data in a couple of great formats for easy use.  Here is a couple of screen shots of my facilities rates and my competition rates.  As you can see there is a huge difference for form the low, average and highest.  And Coventry Facility is the price leader!

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The low is 70 and we are the high at $123 and the average is $100 but would be much lower if you took us out. We are 23% higher than the average and we about to raise rates for the spring.

I need the competitor prices to insure I am the highest. I even bring my price list to all my competition and let them know how high I am.  Hopefully this get them to raise their prices a bit.  But more importantly when they run out of a size a customer needs they refer them to me. My competition is one of my major sources of leads.  They think customers will come back to them one day because they charge less but it never happens

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The 5 x 5 average is $49/mo and the high is at my Competition Mansfield Self Storage but don’t worry I own that facility too!  Wow we are 60% higher than the average!

BONUS Quick tips how to over come the price objection

Most people do not rent is because they were never asked if they wanted to rent. So ask 3 times, “lets get that 10 x 10 in your name”

Many people did not rent because you did not overcome their concerns.  There are only seven typical concerns so its time to learn them and their responses.  So again ask if they want to rent and them overcome their concerns.

Potential renters bring up prices in typically one of the two following ways:

  • Potential Renter: That’s high      

      Your response:  Why do you say that? 

 Now you can over come their concern and rent. You will be amazed at the answers.  The only price concern you really have to compete with is, so & so down the street is cheaper by $20 and that’s simple:  I am sure you can agree we are different and we provide exception value. As you shake you head yes ask would you like to get that unit in your name. The key is not saying anything and let them response.  They either rent or come up with the real concern you can overcome.

Never Never match prices.  After the customer understands your value, you are much better off asking are you ready to rent today? And if they say yes, then offer them a $25 off the first month rent and add in free lock, if they want more.  One time discounts are so much better then ongoing monthly discounts.

  • Question: Can you give me a better price?

Your Response:  I understand your concern. You want to get the most value for your money.  From what I shared with you I am sure you can agree we provide exceptional value.  We keep our rates as low as possible and still provide the services all our clients expect. Would you like to get that 10 x 10 in your name today as you put the lease on the counter.

 

Marc Goodin is President of Storage Authority Franchising, the best Franchise for the busy professional.  He owns 3 self storages he designed, built and manages. He has been helping others in the self storage industry for over 25 years.   He can be reached at marc@StorageAuthority.com or directly at 860-830-6764 to answerer your development, marketing, sales and operations questions.