Are you leaving money on the table?
Have you ever heard of the common English saying, "you have to spend money to make money"? This concept couldn't be any truer in the self-storage industry. When owner-operators get complacent and stop investing in their facilities, they're ultimately leaving money on the table. Continuing to invest in your facility allows you to leverage upgrades over time, increase rental rates and make more money. To determine if your facility could be bringing in more revenue, consider the following 4 questions.
1. What condition are your unit doors in?
A site's curb appeal has a big influence on customer acquisition and retention. When your doors don't look well maintained or are hard to operate, you're likely losing business. Maintaining your unit doors should be a top priority because they directly affect the safety and security of your tenants and their belongings. To put it simply, owner-operators should never let their unit doors become hard to operate because they could lead to physical injury to the tenant or damage to their property. And frankly, tenants don't want to spend money renting units that are hard to access. It's imperative that you're offering your customers a safe experience and this starts with your unit doors. Consider installing dead-axle roll-up doors that have factory lubricated springs enclosed inside of a barrel assembly. This design provides a smoother operation and works to prolong the life of your door while requiring virtually zero maintenance along the way.
If your unit doors are chipping, chalking or fading, it's likely time to consider a door replacement project. When investing in new unit doors, it's important to look for one that's going to resist those aging components that deter tenants. Look for a self-storage door that's available in a variety of durable color options and backed by an impressive paint warranty.
2. How secure is your self-storage facility?
Having a security gate at your facility is a must because it helps tenants feel safe and deters criminal activity from occurring on your site. To enhance security, make sure you're requiring access both into and out of your self-storage facility. This will help you know how long tenants are on your property. Facilities that use Bluetooth access control are much more secure than those using traditional keypads and keys. This is because Bluetooth technology gives you an abundance of opportunities including more visibility and control into your site.
In addition to your unit doors looking their best and operating well, it's important that they're secure. While self-storage units with a traditional hasp and lock can be broken into in just seconds with a pair of bolt cutters, consider installing smart locks on your unit doors. Some smart locks operate inside of the unit door and even come with thermal motion sensors inside of the unit. If any activity is detected when that unit is in the locked position, it automatically notifies you of the activity. This means you'll know immediately if someone is trying to sleep in a unit or break into one. Smart locks will even give you a step-up on the competition while allowing you to charge higher rental rates for the jump in security and convenience.
It's important to have high-tech cameras and video surveillance around your facility to capture all activity in case an incident does occur. Make sure your cameras are placed all around your facility and not just at the entrance and exit points. This will help you have more visibility over your site. With the advancement in technology, there are now cloud-based security cameras with high-resolution, optimal zooming capabilities and other smart features such as two-way audio. Most of these cameras can integrate with your smart security system, allowing you to view your video footage in real-time from an app or online web portal. You'll quickly find that tenants are willing to pay for heightened security, making the investment in high-tech cameras and video surveillance well worth it.
3. Is your facility rented at maximum capacity?
If you're rented anywhere above an 85% occupancy rate, you're likely losing money. This is because you no longer have inventory to offer new customers or a way of leveraging an increased rental rate. Consider renovating your self-storage facility, upgrading components or adding portable storage units to your property. All of these options will give you the leverage needed to increase rental rates, generate inventory and make more money while satisfying customers.
4. Are you taking advantage of cost segregation?
If you own a self-storage facility, you should regularly be investing in your property which gives you the opportunity to take advantage of cost segregation. Cost segregation is a well-thought-out tax planning tool that owner-operators can use to increase their cash flow. This is done by depreciating certain types of building components and improvements over a shorter depreciation recovery period.
