When a real estate investor is eyeing opportunities in the self-storage industry, they often focus on acquisition price and occupancy rates. But owning a facility isn’t just about real estate. Self-storage facility management plays an essential role in long-term profitability.
Self-storage property is a unique asset class in commercial real estate in that renters are on a month-to-month basis. As old tenants move out, there is a constant need to find new customers. The ebb and flow of customers, known as churn, requires frequent adjustments to pricing, promotions, and marketing efforts in order to maximize revenue.
If you’re wondering how to manage a self-storage facility and maintain low operating costs, this guide walks through the decisions that directly impact revenue, staffing efficiency, and long-term growth.
What is self-storage facility management?
Self-storage facility management refers to the daily oversight of:
- Leasing and occupancy
- Customer service
- Rent collection
- Pricing strategy
- Marketing and lead management
- Maintenance and security
- Reporting and financial oversight
Unlike other commercial real estate assets, self-storage requires constant operational attention due to month-to-month rentals and frequent tenant turnover. Managing a storage facility is often about two core
1. Choosing the right storage facility management method
Particularly if a facility you’ve purchased is your first brush with the self-storage sector, you may be asking yourself “How do I manage a self storage facility?” Remember, the facility is more than a piece of real estate — it’s a business that needs people to operate it and technology to keep things running smoothly.
Self-storage management boils down to three options:
- On-site self-storage management: Hire on-site management, with employees handling day-to-day operations. In this case, you can be more hands-on and maintain a regular presence at the facility or more hands-off and entrust the bulk of management to on-site professionals who are on your payroll. Either way, don’t forget that you’re not only in the real estate management business but the people management business.
- Remote self-storage facility management: Technology has made remote or hybrid facility management much more appealing. You can set up self-service kiosks for customers to rent units, and enable those customers to enter their units electronically and pay their rent online. Of course, this requires a hefty investment in technology, but that investment can be offset by the need for fewer on-site employees (or no on-site employees at all).
- Third-party facility management: Across the country, management companies and major self-storage operators run self-storage facilities for the owners. Yes, you’ll be handing over a certain share of your revenue to the third-party manager, but you won’t be saddled with day-to-day management details. They will assign a facility manager to your property instead of it being your responsibility to find and hire one. Storable’s third-party facility management software makes it easy to scale your operations.
2. Zero in on customer service
Customer churn increases marketing costs and suppresses revenue. Regardless of how your facility is managed, your customer service is extremely important. Great customer service can keep existing renters and attract new ones, while poor customer service can cause constant tenant turnover and push down your occupancy rates.
Consumers typically have several self-storage options within a few miles of their homes. If you deliver superb customer service, your renters may never give the alternatives a second thought. Any facility manager that interacts with your renters should be rigorously trained on how to provide excellent customer service and how to properly deal with upset customers.
Customer service best practices include:
- Fast response to inquiries
- Clear billing communication
- Transparent policies
- Easy online account management
Operational software can support these efforts by tracking customer interactions, automating your tenant communications, and providing easier options for recurring and online payments. Check out Storable’s self-storage CRM for better lead management and streamlined communications.
3. Pay attention to customer feedback
In person, online, or over the phone, customers often will let your property managers know whether you’re doing a great job or a poor job. Here are some tips for monitoring and utilizing customer feedback:
- Monitor Google and marketplace reviews
- Follow up on negative experiences
- Identify recurring operational issues
- Send out occasional surveys to gauge customer experiences
Every bit of feedback you receive can be used as a learning experience. Double down on the things that customers tell you they love about your facility, and work to correct the things they wish you’d improve. Addressing patterns quickly helps reduce churn, improve online reputation, and protect long-term occupancy, leading to increased revenue.
Get more facility management tips for improving operations
4. Leverage technology to save time and resources
Not that long ago, many self-storage owners kept track of each and every business transaction with paper and pencil. In the 21st century, it’s time to throw out the paper and pencil, and lean on technology. Especially if you’ve settled on managing the property yourself, you’d be wise to look into self-storage management software such as Sitelink or Storable Edge.
Self-storage facility management software helps operators:
- Manage multiple facilities from one dashboard
- View real-time occupancy and revenue
- Automate pricing adjustments
- Integrate payments and access control
- Generate reports instantly
These features save manual time and resources- from reducing payroll hours to eliminating paper-based errors.
Common features of self-storage management software include facility management, inventory control, online rent collection, access control and website design.
If you end up enlisting help from a third-party property management company, be sure its self-storage management software is top-notch.
5. Get more from your storage marketing strategy
This may sound elementary, but you must market your facility. You can’t count on tons of business from people simply driving by your property.
These days, most folks find self-storage facilities online. Therefore, you need to solidify your digital marketing efforts. This includes maintaining a robust web presence, such as an easy-to-use website and some online promotion (like listings on self-storage marketplaces).
Traditional marketing can help attract renters, too. This might include printed brochures and fliers, on-site events, easy-to-see signage and incentives for current renters to refer potential customers.
Part of a self-storage manager’s job will be to follow up with all of the leads generated by your marketing efforts. Always be cognizant of the price you pay for leads, but overall marketing is an important investment for increasing the profitability of your storage operation.
5. Monitor your performance and adjust accordingly
A great strategy for lowering operating costs is to make data-driven decisions based on your facility’s performance. Every storage facility owner should have visibility into:
- Occupancy by unit type
- Revenue trends
- Delinquency rates
- Lead volume and conversion
- Payroll as a percentage of revenue
Real-time reporting into these areas allows you to make adjustments as necessary, identify underperforming units, reduce unnecessary labor hours, and make more confident decisions.
Frequently Asked Questions
What is the fastest way to reduce operating costs at a storage facility?
The fastest way to reduce operating costs is to evaluate payroll and administrative inefficiencies. Automating rent collection, late notices, reporting, and move-ins can immediately reduce staff workload and overtime while improving consistency.
How can technology lower self-storage operating expenses?
Managing a storage facility with the right technology can help reduce costs by:
- Automating repetitive administrative tasks
- Reducing delinquency through automated billing and reminders
- Eliminating paper-based errors
- Centralizing reporting across locations
- Integrating payments and access control
How can I measure whether my facility is operating efficiently?
Track key metrics such as:
- Payroll as a percentage of revenue
- Cost per move-in
- Delinquency rates
- Lead-to-lease conversion rate
- Revenue per available unit
Efficient storage facility management drives profitability
When your systems work together, operating costs decrease, and margins become more predictable. Storable is here to help you streamline your operations and drive more revenue through integrated and configurable technology. Explore the full Storable platform today, or request a free demo.
