Has the Time Come for the Un Manned, Automated Self Storage Rental Office?
And how you can automate your self storage facility today for more profits.
By Marc Goodin
Lease by Phone, Website or Kiosk vs.
Lease by Phone, Website or Kiosk or with our Onsite Manger,
Which would you choose?
We know self storage automation to the point of an unmanned rental office it is possible because there are more and more unmanned facilities every year.
Full rental automation simple requires two major components. The first is an office manned by a kiosk connected to a good call center. Open Tech Alliance has you covered when it comes to the best self storage kiosks and call centers. Their kiosks even dispenses locks. Even if you are not going fully automated a kiosk will make you more profits because you will not miss after hour rentals to your competition.
Here is a facility I designed that just opened with an Open Tech Alliance kiosk. We require all Storage Authority Franchise self storage facilities to have a kiosk because they are both a profit center and are a backup when a manger is not there for any reason.
The second item required for an un manned self storage facility is individual door looks for each individual unit. Janus International is the leading provider of self storage door locks. The door locks are the major extra cost for an automated facility since every facility should rent online and have a kiosk. Presently individual door locks cost about $200+_ installed per door. For a 55,000 net rentable square feet facility this would be about $100,000. Not unreasonable when you consider the cost of a manager year after year. I expect the price of individual door locks will come down significantly in the next 5 years and that they will become standard even for a manned facility.
Great self-storage management software, like Sitelink is already cloud based and can be run from anywhere you have internet. Likewise, your self storage camera, security, HVAC controls and gate systems should also be cloud based so they can be operated and monitored from off site.
As part of automation your website should also fully rent units online. I know 99 percent of everyone reading this article have websites that do not make online rentals that permit renters to move in when you are closed. If your considering automation (and even if you are not) your first step is to update your website to rent units.
If we just looked at the facts above it would seem clear that automation is the way to go. But we have to look at one more set of facts: What do our clients want, which in turn relates to profits. The world is more automated day by day. In 2018 we hit the 50% mark for online shopping; Mc Donald’s are putting more ordering kiosks in their restaurants; I often use my bank ATM vs going inside the bank. But for Ninety percent of the time I need something from Home Depot I go to the store. Maybe you make 50% or more of your purchases online? But that does not mean that it is time to make banks, retail stores or self storages automated and loose customers by eliminating one on one service.
When you are checking out at Wal Mart or Home Depot have you noticed there are two or three people in line at the manned cash registers and 1 person at the kiosk checkout. Most people prefer to have someone help them check out. We still trust people more than machines, especially when we have a question. Of course, if I only have a couple of items and there are 4 people with full carts at each of the manned cash registers, I will head over to an empty checkout kiosk. Companies like Home Depot have figured this out and that’s why they have both.
If renters have a choice between two equal facilities most will choose the manned office vs the automated self-storage office. It is a myth that a manned and unmanned facility are equal. Both can have the same great locations, features, prices but only the manned facility has a real unique selling proposition. And that is a good manager who gets to know a client, builds trust and loyalty. A kiosk can not do that. An un manned facility will often have a lower rental price but if you have not already learned a low price is the absolute worst selling feature a self storage can have.
I have been renting self storage units for a long long time and I estimate 30% (ie 60% walk ins will rent even if your manager is a clerk) of our rentals would have walked out of the office without renting except for our high end remarkable, rediculasly over the top customer service, sales and marketing provided by our well trained managers. And our rates are 20% higher than our competition. Our number one rule at our facilities is every prospect is taken out the door in 30 seconds or less to see a unit. This gives us time to understand their needs, get to know them, build trust and for the renter to have the opertunity to physically see the difference from one size to the next so they are comfortable and ready to rent. Viewing the size gives the prospect the ability to confirm the size they need so we can say “ looks like a 10 x 10 is the right size for you, let go back to the office and get one in your name.” A self-storage kiosk will never take a customer to see a unit or builds trust. It’s hard to rent an apartment or sell a house or sell a car, a person has not seen. To a big degree the same goes for self storage.
When it comes right down to it the number one thing that makes your facility different from the facility down the street is your manager. And a good manager will rent more units at a premium price and have more loyal customers and referrals than a similar unmanned facility or a facility with an untrained manager. You could argue the maned facility can’t rent before and after hours. But online rentals and kiosk provides manned facilities the best of both worlds. It serves as a backup to the manager busy with a customer and is there for the few individuals that would rather do the entire process at kiosk or needs to rent after hours.
Some owners simple do not have the time to manage their facility as they have a busy career or are on too building their third and fourth facility. In this case the loss in profits is a tradeoff for going with an automated system. I would suggest they have two more profitable alternatives: a good management company or a Storage Authority Franchise. Even if the facility office is unmanned who is doing the daily site checks and cleaning each unit before it is re rented. Who is marketing the facility? Who is calling the nonpaying renters? Who is managing the auctions? A good manager with well-established systems and platforms should be doing these items in addition to renting units.
A second case for the unmanned unit would be for a very small facility. Maybe you have a 15,000 square feet facility. This would be a good candidate for an automated facility as the overhead of a full-time manager would not be warranted given the limited income potential.
There are companies that are only building automated facilities. Ten Federal is one of leaders in unmanned facilities. Their website headline is Lease by Phone, Website or Kiosk. They have improved the un manned system significantly and I am sure it is working for them.
But again, if you only have one facility, I believe you can add substantially to your bottom line profits with a good manager vs an un manned facility. Even up to an extra $100,000 or more. I have no concrete proof for this dollar amount but in my selling self-storage book Crush your Competition in week 1, of 52 weeks of self-storage marketing ideas, I outline how you can make well over a $100,000 a year with over the top marketing & sales. And a kiosk just does not have the ability to implement a sales and marketing platform for extra profits.
Ten Federal website clearly notes they do not have a move in administration fee. I like administration fees! This fee is worth over $12,000 a year in profits for me and provides for one heck of a vacation every year for my family. And even more concerning for the single operator is their prices are all web prices which are typically reduced from the office rental price. And they are also giving huge discounts for the first month, another no no for the single operator.
Bottom line, we will be seeing more unmanned facilities because many owners and management companies do not want to take the significant time and effort to prepare and implement the self storage managers operations, sales and marketing systems and platforms and an ongoing training programs But that is good news for those of us willing to get it right for our customers because we will have the opportunity for oversized profits, others have given up.
To be competitive now and certainly in the future all facilities should have the unmanned components in the sense your potential clients should be able to rent when your office is closed. These tools will also reducing costs by shortening the managers hours. The days of the self storage office being open from 8am to 8pm seven days a week are long gone and have been replaced with closed Sunday and reduced hours the rest of the week.
Marc Goodin is President of Storage Authority LLC, the only self-storage franchise in the US. He owns 3 self storages he designed, built and manages. He has been helping others in the self storage industry for over 25 years. He can be reached at marc@StorageAuthority.com or directly at 860-830-6764 to answerer your self storage franchise, development, marketing, sales and operational questions.