The 5 Costliest MistakesYour Self-Storage Facility Is Making!

MATT VANHORN

Cutting Edge

Management

&

3 Mile Domination

JIM ROSS

Cutting Edge

Management

&

3 Mile Domination

Mistakes to Avoid

Not Having

Proper Revenue

Mgt

Forgetting About Other Marketing Techniques

Not Having A Converting Website

Not Concentrating on Conversion %

Not Training Properly

Mistake #1: Not Training Your

Managers Properly

USE A TRAINING CHECKLIST

Mistake #1: Not Training Your

Managers Properly

FACILITY MANAGEMENT

DAY TO DAY ITEMS

FINANCIAL

MARKETINGSALES

CUSTOMER SERVICE

DAY TO DAY OPERATIONS

Do The Manager’s of Your Self Storage Facility know what they should

be doing or are they making it up as they go along?

The operations of your facility need to be broken down to the most

boring detail.

• What time does your facility manager need to be in the office? Is it

10 Minutes Early? Right at opening?

• When, exactly, should they take lunch? How long?

• How often should a walk through be completed? What time? Where

is the documentation filed?

• How often should the Hallways be swept? Office cleaned? What is

allowed in the office? When should the bathroom be cleaned?

• If there is an emergency (Fire, Sink Hole, Customer Issue) who do I

contact? How do I get ahold of this person?

DAY TO DAY OPERATIONS

Having set policy’s and procedures will take care of this issue

• Use Checklists for everything.

• Have your Policy and Procedures available at all times

• Can be Paper, PDF in a file sharing program, or host them on a

website (easier then you think).

• If possible, use video to document how things are to be completed.

DAY TO DAY OPERATIONS

FINANCIAL

We need to train our self storage managers on the finance of self

storage

• Do your managers receive an annual budget, do they understand

where the numbers come from? Is your budget realistic?

• Do you allow your managers to review the facility’s P&L? Do they

understand how Revenue, Expenses, and NOI affect facility value?

MARKETING

The biggest issue in Self Storage Marketing, is who is responsible for

creating, executing, and tracking the plan?

• CREATING: Who is creating the marketing plan? Manager, Owner,

Outside Company?

• EXECUTING: Who is responsible for launching/implementing the

marketing plan? When? How? Budget? Time Frame?

• TRACKING: Who is responsible for making sure all of the

campaigns are tracked correctly? How? Conversions? What’s a

marketing win?

SALES

Your average self storage

customer is looking to your self

storage manager as the “expert”

• SCRIPTS: Do you have a sales script? There is a reason the biggest companies in the world, use scripts?

• TRAINING: Invest in creating training videos

• ROLE PLAY: Use role playing for practice.

CUSTOMER SERVICE

• Has your self storage manager been trained on how to effectively work with customers?

• How much leeway does your facility manager have? Can they waive a late fee? Change a rental rate? Provide the customer with a cup of coffee?

Mistake #2: Not Concentrating On

Higher Conversion %

How Much Is An Extra Rental Worth

To You ?

*based off national averages from 2013 self storage almanac

Mistake #3: Not Having A Great

Converting Website.

Design Your Website To Knock

Out Your Competition!!

Mistake #4: Forgetting About Other

Marketing Techniques

MARKETING BOMBARDMENT

• By age 66 most of us have

seen about 2 Million TV Ads

• Like watching nothing but Ads

24/7 for 6 consecutive years

• We are exposed to at least

247 separate images a day. You

probably didn’t notice ½ of them

• Email, Social Media, Phone Calls, Web, etc, etc.

GENERAL RULES

• Do not be boring….

• Do not Spam…

• Provide something that will evoke an emotional response

• Practice with multiple types of media: (Video, Web, Email, Direct

Mail, Print, Social Media, etc.)

• Create and Find great content, it’s necessary to be successful

• The average person needs to be touched

4-5 times by advertising before they make a decision

PHYSICAL NEWS LETTERS

• Helps get through the barrier

• Cannot be deleted

• It has to be touched before

it hits the trash

• Interesting articles, games,

recipes, etc.

Professional Cost:

$500 for Monthly Layout

$1.15 p/issue mailed

DIRECT MAIL

• Helps get through the barrier

• Cannot be deleted

• It has to be touched before

it hits the trash

• Create individual/targeted campaigns

• Attain a Solid Mailing List

• Track Everything

SOCIAL MEDIA

WHAT TO SHARE

TURNOFFS

WHEN TO SHARE

CUSTOMER SERVICE

Mistake #5: Not Having Proper

Revenue Management

WHAT IS REVENUE

MANAGEMENT?

Revenue Management is an overall strategy to most effectively

manage revenue to maximize return. Rate Management, USP,

Marketing, ETC

**Not just about raising rates**

IT’S ABOUT VALUE NOT PRICE

WE NOW LIVE IN A VALUE BASED WORLD (AMAZON, NETFLIX, APPLE, ETC )

IF YOU ARE 100% OCCUPIED YOU

ARE LOSING MONEY

WITH ONE STATEMENT YOU HAVE

DONE THE FOLLOWING:

• Set a permanent limit on your potential revenue

• Your expenses will increase and you will sit back and watch them

deteriorate your NOI like a school of piranha.

• You will continually turn away potential customers

• You enjoy burning $100 bills, because that is exactly what you are

doing with your marketing budget.

EXISITING: HOW THE REITS DO IT

• EXTRA SPACE: Increases rates on current customers up to 7% and

as often as every 9 months.

• CUBE SMART: Increase rates, 6%, on current tenants once at 6

months then again every 12 months.

PRICING STRATEGIES

TIERED PRICING

3-TYPES OF OCCUPANCY:

1. PHYSICAL OCCUPANCY: NUMBER OF RENTED UNITS /

NUMBER OF TOTAL UNITS

2. SQUARE FOOT OCCUPANCY: AMOUNT OF RENTED SQUARE

FOOTAGE / TOTAL AMOUNT OF SQUARE FOOTAGE

3. ECONOMIC OCCUPANCY: ACTUAL RENT / POTENTIAL RENT

WHICH IS THE MOST IMPORTANT

The answer is Economic Occupancy.

THE ONLY OCCUPANCY

THAT CAN GO ABOVE 100%

EXAMPLE 1

So for example let’s say your 10x10’s are $100 at standard rate and you have 10 of them.

Example 1:10- 10x10’s @ $100 p/unit ($1000 potential rent)10- Rented @ $100 p/unit (everyone is paying full price)10x$100= $1000 p/month actual rent (because everyone is paying the full price)$1000 (actual rent)/ $1000 (potential rent) = 100% Economic Occupancy

EXAMPLE 2

Now let’s look at it from a discounted point of view:

Example 2:

10-10x10’s @ $100 p/unit ($1000 potential rent)

10- Rented @ $90 p/unit ($10 dollar discount p/unit)

10x$90 = $900 p/month actual rent (because everyone is

discounted $10 p/unit and not paying full price)

$900 (actual rent)/ $1000 (potential rent) = 90% Economic

Occupancy

EXAMPLE 3

Now let’s look at it from a TIERED pricing point of view:

Example 3:

10-10x10’s @ $100 p/unit ($1000 potential rent)

10-Rented @ $110 p/unit ($10 premium on each unit)

10x$110 = $1100 p/month actual rent (because of TIERED

pricing everyone is paying $10 more than the standard rate

p/unit)

$1100 (actual rent)/$1000 (potential rent) = 110%

Economic Occupancy

ONLINE VS. OFFLINE STRATEGIES

ONLINE:

• CUSTOMERS ONLINE TEND TO BE MORE PRICE SENSITIVE.

• COMPARISON SHOPPING (LOOKING FOR DEALS)

• CONSIDER OFFERING DIFFERENT PRICES ONLINE

ONLINE VS. OFFLINE STRATEGIES

IN OFFICE:

• CUSTOMER IN YOUR OFFICE NEEDS YOUR PRODUCT NOW

• NO ONE JUST STOPS TO LOOK AT A STORAGE UNIT

• CONSIDER OFFERING DIFFERENT PRICES IN THE OFFICE

INCENTIVES & BONUSES

Incentives & bonuses must accomplish two things:

1. Be profitable for your facility

2. Be easy to understand and attainable for your facility managers

INCENTIVES & BONUSES

If it looks like this:

You’re doing it wrong…

CONSIDER THIS STRATEGY..

Each size code is given a range of prices:

Example: 10x10

• Internet Rate= $95.00

• Standard or Base Rate= $100.00

• “Upsell” Rate= $105.00+

CONSIDER THIS STRATEGY..

• Your internet rate will be supplied online, for those shoppers who are

price shopping

• Your base rate will be the lowest rate you should accept during an

office visit or phone call

• The difference between the base rate will be what the self storage

manager will be bonused on.

EXAMPLE:

XZY SELF STORAGE UPSELL RATE SHEET EARNED TOTAL

UPSELL BONUS UNITS BONUS

NON CLIMATE INTERNET BASE UPSELL UPSELL MONEY BONUS % P/UNIT RENTED EARNED

5X10 $42.00 $50.00 $55.00 $5.00 75% $3.75 1 $3.75

10X10 $64.00 $89.00 $99.00 $10.00 75% $7.50 0 $0.00

10X15 $89.00 $110.00 $114.00 $4.00 75% $3.00 3 $9.00

10X20 $99.00 $114.00 $125.00 $11.00 75% $8.25 2 $16.50

10X25 $142.00 $144.00 $154.00 $10.00 75% $7.50 1 $7.50

10X30 $154.00 $164.00 $174.00 $10.00 75% $7.50 1 $7.50

12X30 $174.00 $179.00 $189.00 $10.00 75% $7.50 1 $7.50

CLIMATE

5X5 $37.00 $49.00 $55.00 $6.00 75% $4.50 4 $18.00

5X10 $52.00 $79.00 $84.00 $5.00 75% $3.75 2 $7.50

10X10 $95.00 $109.00 $119.00 $10.00 75% $7.50 3 $22.50

10X15 $134.00 $134.00 $144.00 $10.00 75% $7.50 1 $7.50

10X20 $164.00 $164.00 $174.00 $10.00 75% $7.50 2 $15.00

10X25 $184.00 $184.00 $194.00 $10.00 75% $7.50 1 $7.50

10X30 $199.00 $199.00 $209.00 $10.00 75% $7.50 1 $7.50

TOTAL 23 $137.25

YOU MADE IT!!!

Thank you!

www.cuttingedgeselfstorage.com/iss