Your Guide to Managing a Self-Storage Facility

Published on December 15, 2023

Managing a self-storage facility effectively is a multifaceted endeavor that requires a blend of strategic insight, operational proficiency, and a keen understanding of the evolving dynamics within the industry.

This guide will cover the intricacies of managing a self-storage unit facility, exploring essential strategies and best practices to optimize its performance.

From customer service excellence to self-storage unit upkeep and marketing strategies to financial management, this article will give you the knowledge to thrive in this dynamic industry.

This section discusses the industry's growth trajectory, key drivers, and its crucial role in meeting the evolving storage needs of individuals and companies.

Definition and History of Self-Storage

Self-storage is a growing industry that offers short-term or monthly storage solutions for various items.

Originating in the mid-20th century, it has evolved to manage and cater to more customers, including management companies and specialized storage needs.

The first self-storage business, "Public Storage," opened in 1958 in California.

Over time, self-storage units have become more refined, offering safety features, climate-controlled units, advanced access control systems, tools, and services like truck rentals and packing supplies.

Today, the industry is a resilient real estate market sector, with thousands of self-storage units nationwide serving diverse customer needs.

Growth and Trends in the Self-Storage Industry

The storage industry has experienced rapid expansion and saturation, driven by increasing demand from consumers and businesses.

The industry has seen a rise in specialized storage facilities, such as climate-controlled units for sensitive items and vehicle storage for vehicles.

Investors can now also hand the reins to management companies to protect their investments and make them profitable.

Advanced technology integration has also been embraced to make managing your storage unit facility easier.

Sustainability and eco-friendly practices have gained traction, with some storage units adopting green building practices.

One of the notable trends in the self-storage business is the increasing demand for climate-controlled storage units.

This section will explore the key principles and strategies for managing a successful self-storage business.

Facility Design and Layout

Location and accessibility are crucial for a facility business, with well-maintained driveways, ample parking, and clear signage being essential. As the owner, you'll also need to consider your storage unit selection.

The storage unit mix should include small lockers and medium-sized units with climate control.

Security measures should include perimeter security, surveillance systems, access control, lighting, a good traffic flow, a sensibly designed office and amenities, and regular maintenance.

Security and Safety Measures

Effective security and safety management is crucial in self-service businesses. This will help your business retain customers and keep their items safe.

Electronic gate access, keypad entry, and smartphone apps are essential for restricting access to specific customers and staff. Surveillance cameras, alarms, and motion sensors are also essential for security.

Installing motion-activated lights and secure fencing around the property can deter trespassers. Automated software can also be used to secure the facility.

Customers may also need training from staff on unit access verification, emergency procedures, fire suppression systems, and fire lanes.

Some facilities also install self-service kiosks to automate the rental process and address the needs of their customers. These kiosks can also be used to receive customer feedback.

Customer Service and Communication

Facilities should be committed to quality customer service and effective communication to manage a successful storage business.

This includes hiring and training staff with excellent customer service skills, maintaining clear policies and procedures, and providing written documentation.

Effective communication means responding promptly and opening multiple communication channels.

Customers should be oriented through onboarding, information packets, online services, and a customer portal.

Facilities should also incorporate surveys to get more customer feedback, and resolve complaints quickly.

Maintenance and Repairs

A self-storage property requires regular maintenance and repairs to ensure customers' safety, protect the customers' belongings, and maintain the property's value.

This includes creating a maintenance schedule, installing state-of-the-art security systems, landscaping, and pest control.

Building maintenance should also include inspecting and maintaining roofs, doors, locks, and paint.

Common areas should be cleaned and maintained, and lighting should be adequate.

Marketing and Promotion

Effective marketing and promotion are crucial for managing a facility business.

Consider attracting new customers by offering exclusive online discounts or running promotional campaigns to fill vacant storage units. The strategies for promoting your facility can involve the following.

• Research
• Online presence
• SEO
• Content marketing
• Reviews
• Reputation management
• Traditional Marketing
• Referral programs
• Special offers
• Analytics
• Customer engagement
• Brand consistency

Research involves understanding the target audience, local competition, and demand for self-storage units. Competitive analysis identifies opportunities for differentiation.

Data from self-storage management software can help companies focus their marketing efforts and minimize marketing costs.

In the self-storage sector, exploring business profitability often involves analyzing pricing strategies, cost control measures, and tenant retention initiatives to maximize revenue and minimize expenses.

Let's discuss how to maximize profitability and start optimizing your self-storage investment in this quickly-growing industry.

The following sections are written for all facility owners, whether they're solo or part of a management company.

Revenue Generation Strategies

To maximize profitability in a facility company, it's essential to implement effective revenue generation strategies and tools.

A self-storage management company should employ dynamic pricing and data analytics, like reviewing the most popular storage unit sizes and tenant turnover.

Facility owners can also use renewal incentives to retain customers.

These strategies aim to increase the facility's income while improving customer satisfaction.

Dynamic pricing adjusts rent rates based on demand, occupancy, and seasons, while rate increases are considered modest for existing tenants.

Cost Control and Expense Management

Maximizing profitability in a self-storage facility involves increasing revenue and managing costs and expenses effectively. The strategies include measures like the following.

• Budget development
• Expense analysis
• Optimizing the number of employees
• Marketing efficiency
• Technology investments
• Inventory management
• Insurance review
• Tax planning
• Tenant retention
• Streamlining operations

Budget development involves creating a comprehensive budget that outlines expected revenue, expenses, and profit margins. Regular expense analysis helps identify cost drivers and optimizes costs.

Pricing and Rate Optimization

Pricing and rate optimization are essential for self-storage facilities to maximize profitability. The process involves the following.

• Research
• Demand analysis
• Pricing
• Storage unit differentiation
• Lease incentives
• Online booking
• Tenant segmentation
• Revenue management software
• Promotions
• Tenant communication

These strategies help generate more revenue while maintaining high occupancy rates and tenant satisfaction.

By implementing effective strategies, self-storage facilities can achieve profitability by balancing revenue with customer storage needs and budget constraints.

This section discusses legal and insurance matters that storage facility owners need to be aware of.

Legal Compliance and Documentation

Legal compliance and documentation are crucial for managing a unit.

It involves adhering to local, state, and federal regulations, like zoning laws, building codes, accessibility requirements, and environmental regulations.

Lease agreements should be written in clear language to avoid disputes. Tenant rights and responsibilities should be clearly defined, and lien laws should be understood and adhered to.

Liability insurance should be maintained to protect against claims related to property damage.

Insurance Coverage and Risk Management

Insurance coverage and risk management can protect a business from financial loss and potential liabilities.

Sufficient risk management strategies can help mitigate potential liabilities and reduce insurance costs for self-storage facility owners.

Key considerations include general liability insurance, property insurance, tenant insurance, business interruption insurance, and cyber insurance.

Risk management strategies include robust safety measures, safety protocols, emergency preparedness, regular inspections, tenant screening, clear lease terms, and liability waivers.

It's also a good idea to educate your potential customers and tenants.

Tenants should be educated about the benefits of tenant insurance and the importance of protecting their stored belongings.

This segment offers real-world success stories from the self-storage industry.

Case Studies of Successful Self-Storage Facilities

Zanesville Best Storage

Nick, a long-time investor in single-family rentals and mobile homes, shifted his focus to storage in 2020. His facility, Zanesville Best Storage, has grown significantly despite off-peak seasons.

Nick emphasized operational capabilities, technology, and scalability and chose a remote third-party self-storage facility management software for convenience.

He diversified his unit with different sizing options, helping him cater to diverse storage needs.

He implemented remote management software to save money and hired Copper Storage Management (CSM) software for bookkeeping, marketing efforts, and call center services.

The facility currently sees a 4% monthly growth rate and is expected to continue growing during busy seasons.

Placerville Self Storage

The self-storage facility in Placerville, CA, was acquired by Crescendo Properties in March 2016. The property was analyzed for revenue growth opportunities and improved accordingly.

The property's online local listings were improved, and the tenant property protection program was implemented, increasing occupancy from 84% to 93%.

The property's late fee structure was adjusted, increasing annual late fees from $14,648 to $26,287.

The administrative fee was increased to $30.00, resulting in an additional $3,312.64 per year without harming occupancy.

The property's ownership refinanced and pulled out 71% of their initial equity, resulting in a cash-on-cash return of 34% per year.

Lessons Learned and Key Takeaways

Successful facilities are located in high-traffic areas, near residential neighborhoods, or close to businesses, and invest in marketing efforts that resonate with their target audience.

They offer a variety of self-storage unit sizes and types, prioritize exceptional customer service, invest in modern safety measures, streamline rental processes, and develop tenant retention programs.

Regular maintenance and upkeep also keep existing renters and reduce operational costs associated with repairs and refurbishments.

Data-driven decision-making and community engagement can help optimize revenue and operations.

By applying these lessons and takeaways, a facility manager can achieve similar success levels.

Find out more about managing self-storage facilities here.

What Is the Average Cost of Starting a Self-Storage Facility?

The average cost considerations to build a self-storage facility can range from $1 million to $5 million, depending on location, size, land acquisition costs, construction expenses, and amenities offered.

Expect to pay more for better locations, like those closer to the city center.

How Can I Attract Customers to My Self-Storage Facility?

To keep existing renters and attract new customers to your self-storage unit, try these tips.

• Invest in effective marketing strategies
• Create a user-friendly website
• Offer competitive pricing
• Highlight safety features
• Provide excellent customer service
• Collaborate with local businesses
• Engage with the community
• List your facility on online directories
• Use Google Ads for pay-per-click advertising

These strategies will help build trust, attract potential customers, and increase your facility's visibility.

What Are the Most Common Challenges Faced by Self-Storage Managers?

The most common challenges self-storage managers face include tenant delinquency, unit protection, competition, maintenance, and regulatory compliance.

How Can I Ensure the Safety and Security of My Self-Storage Facility?

To enhance your storage unit's security, implement the following measures.

• Install robust safety systems
• Implement proper lighting
• Conduct regular audits
• Enforce strict access procedures
• Educate tenants
• Collaborate with law enforcement
• Invest in secure locks
• Reinforce fencing
• Develop emergency response plans

What Are the Key Factors to Consider When Hiring Staff for a Self-Storage Facility?

When hiring employees for a self-storage facility, consider these factors.

• Customer service skills
• Safety awareness
• Technical proficiency
• Maintenance skills
• Tenant relations
• Background checks
• Dependability

These factors help build capable and customer-focused employees.

From legal compliance and customer service excellence to cutting-edge technology and marketing prowess, each component contributes to your facility's prosperity.



With the self-storage industry showing continued growth and evolution, embracing these approaches can help your self-storage facility thrive.

We encourage you to take action, leverage these insights, and embark on a journey to realize your self-storage facility's full potential.