With the right tools and information, starting a self-storage business can be a profitable enterprise regardless of turns in the economic cycle. In a booming economy, people tend to purchase recreational vehicles or travel more often. When the economy is declining, people may be downsizing their home space and may like to store away the excess furniture temporarily. Either way, self-storage facilities are a convenient way for people to securely store their things. Developing, building and running a successful self-storage is a dream for many small business owners.
Early Planning for Success
Develop a well-thought-out business plan for the self-storage. A good plan assists in developing ideas into reality, outlines profitability and presents a forum for questions and answers from start up to fruition. It should address financial issues and outline steps for opening the business. Estimated business profit and loss can also be included in the business plan.
Financing a self-storage can be very difficult and personal loans and partnerships are common options. Banks specializing in self-storage brokerage and property management can finance new self-storage units but are difficult sources to borrow money from.
Self-financing can occur when the buyer has cash in hand and makes an additional less-expensive optional available, like purchasing from bank foreclosure auctions where self-storage facilities can be purchased for about fifty cents on the dollar.
Location Planning and Approvals
Determining the location for a new self-storage will rely on many factors and some may even want to hire someone to do a feasibility study on the land. Hiring an engineer and an architect to assist from visual appearance, height and space factors may be a good idea. The architect may even present ideas on building conversion.
Consideration of the surrounding population and accessibility to customers can highly contribute to success in this business.
Receiving approval from the city regarding development of the land is usually done through a Planning and Zoning Board. The land must also be industrially zoned. Some cities require that no other self-storage units be located within a certain distance without a population exception.
Determining which type of building materials are to be used will depend on price, population served and the surrounding community. Aesthetic considerations are also important while opening self-storage business
Governing self-storage facilities may be done by state law, however city approval is required before building, opening or operating mini storage units.
Starting with numerous building permits, meetings with the City Council, Planning Boards and concerned citizens may be plentiful and require the involvement of owners, builders and other associated parties.
Obtaining a business license and operating permit is crucial to opening the self-storage.
Pre-Opening Planning Ideas
Staffing should be in place before the self-storage is complete and ready to open. The person who oversees the self-storage site and is responsible for managing and delegating is known as the self-storage operator. The operator should be trustworthy, responsible, honest and hardworking. In other words, partial owner or a family member is a prime choice.
Training operators prior to opening day in the software to be used in running the self-storage is another key. It may be beneficial to have the assistant management staff hired before the opening day.
Changing city and state laws effect self-storage businesses. Therefore, operators should also decide on how they would stay updated.
Security requirement has become a priority to renters looking to store their personal goods. Getting to know about types of security available and currently utilized by similar businesses and implementing a security system before the opening of the self-storage is important.
Incorporating extra goods into the business to return a profit is becoming common among many storage businesses. Michael Delaney of Bee Safe Storage advises, “Everything from moving boxes to storage supplies and even offering customer assistance can increase foot traffic and sales.”
Spending money to make money applies to the marketing of any new business. Advertising options are plentiful and finding ways to market the new self-storage within the outlined budget will require some creativity. Determining how prior to start marketing and perhaps even incorporating opening move-in specials can be crucial to higher initial rent percentages.
Finding a niche, such as offering RV Storage, can be crucial to setting a business apart from its competitors.
- Finding a niche, such as offering RV Storage, can be crucial to setting a business apart from its competitors.
Nanette Delaney Burton, mother of three, began writing professionally in 2004. She holds a Bachelor of Arts from the University of California, San Diego in political science (American politics and law; minor in psychology). Burton is currently working on her Juris Doctorate.