How to Run a Self Storage Facility | The Most Detailed Guide on the Entire Internet
Updated: Feb 13
Self-storage isn't exactly rocket science. And for all except the largest operators, it can be quite simple. Well, as simple as a "real" business can be. Now, I don't want to downplay things here. Self storage isn't as simple as house hack or running a lemonade stand - it has more moving parts. And calling self-storage "passive income" is, frankly, only touted by folks trying to sell their passive income courses online. But seriously, your ultimate goal is to rent out safe, clean sheds to folks. We aren't running a restaurant chain, managing a hospital or manufacturing company.
This blog post aims to be a living document. Updated in real time with all the knowledge that I (and any other co-author) have regarding self storage management. While there is going to be subtly with every aspect of management, we outline a
The Self Storage Management Mindset
Every operator is going to have different goals. You need to reflect on these goals before running your facility. Answer the following questions regarding your facility.
Do you want to run the facility operations yourself?
Do you plan on doing on-site maintenance yourself?
Do you plan on overlocking units yourself?
Do you plan on expanding in the future?
Are you going to hire a virtual assistant to deal with emails and mid-level customer support?
Are you going to hire a call center?
Do you want to hire a management company?
Do you want to do SEO yourself?
Are you planning on buying/holding the facility?
Do you want to push rental rates and maximize occupancy?
Or, are you happy with putting less effort in and not pushing rates? (nothing wrong with that, not every facility has to be run like a machine!)
The Self-Storage Customer Support Hierarchy
As a self-storage investor, you are bound to deal with storage customer support issues. This can range from standard customer interactions like renting a unit to moderate complaints like a beehive in the gate keypad to major issues like flooding, fire and theft.
We use a low, moderate, high framework to help address customer support issues.
1. Tier-1 Customer Support Issues
This tier includes most "regular" customer interactions like renting a unit, updating a credit card or potential customer inquiries that can be answered by our call center. Call centers operate using a "script" but many are advanced and can act as a pseudo-manager as well. For example, our facility - The Moody Call Center - will often make suggestions related to customer service or even self-storage best practices in relation to customer conversations they are having.
2. Tier-2 Customer Support Issues
These issues are more advanced than your call center can handle and often times require direct guidance from the owner or full time manager. For smaller facilities that don't have a full time manager, we tend to use a VA for these types of issues. However, when the issues first come up you may need input from the owner.
These moderate issues include:
Customer complaints
Overlocks
Onboarding problems (customers with advanced questions related to renting a unit)
Basic repairs (a broken camera, a bees nest in the access control pad)
Finding a new boots on the ground or lawn maintenance professional (the decision to switch may sometimes delegated to Manager/Owner Tier).
3. Manager/Owner Tier Customer Support/Operations Issues
These issues are beyond the level of a virtual assistant or call center.
These can be major issues like:
Fire
Flood
Theft (although if you have good policies and procedures in place, this can be handled by Tier-2 support)
Expensive construction related issues
Continued evaluation of supporting staff (accountant, lawn care, bookkeeping, boots on the ground, virtual assistants). Continued re-evaluation of your supporting staff is important to keep the customer experience on point. This is up to the owner/manager. However, once you decide to to change supporting staff, this can be delegated to Tier-2 support folks.
Self Storage Management Software
There are many possible solutions and we are working on building a single database of every option.
Pick one and GET GOOD AT. Literally know every single button. Take my bad experience as an example: I remember when we first took over a self storage facility that was using ESS. I was lazy and didn't do a detailed review of the entire system. The previous owners already had ESS up and running so I figured everything would be easy. However, after a couple months, we we realized that move-in's were not what we expected. Eventually I discovered the following on our website:
Yes, you got it right. To onboard our customers, we were asking a total of 38 questions. This was resulting in a large amount of customers abandoning their "cart" - getting ready to buy but then stopping when they had to enter a bunch of not so useful information. Once we changed this, things got better.
How to Find the Right Call Center for Your Storage Facility
Want to add to this part of the blog? Message us!
Digital Marketing for Self Storage Facilities
This is a big one. Our Self Storage SEO/Marketing Course covers this in detail. For now, we simply recommend watching the entire video. Download the SEO checklist here.
While you are at it, check out our detailed Google Business Profile walkthrough as well.
Boots on the Ground for Self Storage Management
A good boots on the ground operator can make or break your business. A quality, cost-effective boots on the ground person is worth their weight in gold.
They perform a multitude of tasks including:
Light repair
Overlocks
Cleanup
Lock cutting
Weekly walkthrough/inspection
Lawn care (although this can be outsourced to a dedicated third party lawn care company)
Snow removal (similarly to lawn care, if you self storage facility needs snow removal, you can outsource this to a dedicated person).
How to do Bookkeeping for a Self Storage Facility
If you don't pay attention this will sneak up on you. And there is nothing worse than having a self storage facility where your books are not in line. Bookkeeping refers to the day to day movement and tracking of money. Some questions to consider AND have a very specific answer to:
What bank are you going to use?
How are you going to pay people? And remember this can be different for different folks. Check? Cash? Debit card? Online payment through Quickbooks?
How are you going to keep track of receipts?
Who is going to categorize your transactions and prepare them for your accountant?
What type of payments will you be collecting and how are you going to collect payments?
Do you have employees that you need to pay and keep track of their hours?
How to do Accounting for a Self Storage Facility
This is a broad topic with multiple aspects. Most importantly it to note that bookkeeping is different from accountating, although it can be done by the same person. Accounting encompases: financial predictions, annual financial reports, tax strategy and filing taxes.
Overlocking a Late Storage Unit
This should be step by step defined with everything mapped out. See our detailed post on the topic but we use the davinci lock system with the following procedures:
If a customer needs overlocked because they didn't pay, we manually add the lock. If the customer pays, they go to https://davincilockrelease.com/ which integrates directly with ESS. The DaVinci website can tell if the customer has paid their bill and automatically gives them a cod to unlock their overlock. The customer then returns the overlock into our dropbox.
A popular alternative to DaVinci locks is the Noke suite of locking technologies. These include built in digital door locks and digital padlocks.
Online Booking and Payments for Self Storage
We use ESS but there are many platforms that allow this.
How to form a business entity (LLC, C-corp, S-corp)
You should work with your accountant and lawyer on this one. In general, most of these provide some
Ancillary Revenue Streams
There are several different ways to generate revenue besides renting storage units. Popular options include:
Tenant Insurance
Moving Services like caddymoving.com and Uhaul partnerships can be very lucrative
Physical product sales (boxes, locks, etc.)