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How to Start Your Own Self Storage Business

The self-storage industry in the U.S has been experiencing steady growth over the last decade. 

This indicates there is a good market for the business. When there is a market, you expect the competition to get stiff as more entrepreneurs try their luck in the lucrative business venture.

To increase your chances of success, you’ve got to carry out comprehensive research to find the market gap that you can utilize to overcome competition. Here is a complete guide on starting out your own self storage business.

1. Do a Market Research and Feasibility Study

Before you start a storage business, do a thorough research of the existing storage businesses. Find out what they are doing right that you can emulate.

Watch out for the mistakes they make that you can rectify to give you a competitive edge over them. Will your store deliver services cheaper or more efficiently than other stores?

Visit an established self-storage company in your area and learn all you need to know about how to start a firm in the industry. You can view here some reliable storage units, rent a unit, and gain insight into what the business entails.

You also need to study your potential customers. How do they want their goods stored? When you know what your potential customers want, you can easily come up with something that will satisfy their needs.

2. Develop a Business Plan 

Since you’ve already decided on storage business, you need a business plan. The plan will help you determine where your store business is heading, how it will overcome challenges and the things you will need to sustain it.

The business plan will answer some questions which include:

  • How the store will get financed
  • How you will handle the business challenges you will face
  • What you will do differently from the competitors
  • Who the store customers will be
  • How you will reach the customers and satisfy their needs
  • How the store will make money
  • How you will exit in case the business fails 

3. Evaluate Your Finances  

How are you going to finance your self storage business? Can you provide all the start-up capital by yourself or you will get assistance from others? How will you survive before your business starts making a profit?

Those are some of the questions you need to answer.

Sometimes all you need is to trim your budget rather than solicit for extra funding. Most people spend lots of money on unnecessary stuff they don’t need in their business. However, if you need extra funds to finance your storage business, you can try different sources such as:

  • Friends and family donations
  • Debt funding such as business loans, personal loans, etc.
  • Sales of shares of ownership from your other company (if any)
  • Pitching venture capital investors 

3. Register Your Self Storage Business  

For your storage business to become a business entity, it has to be legally registered. You should:

  • Register name or trade name. If you don’t use your name to register the business, then you will have to register a trading name. 
  • Register as a legal entity. It isn’t mandatory but it will give your business a formal legal structure. 
  • Register with the IRS and The State Revenue Office. If you are going to run the store alone for the rest of your life, then you don’t need an employer identification number (EIN). But if you are planning to have an employee, the EIN will help you keep your personal and business tax separate.
  • Get the right business permit and licenses. Every business requires a business permit and license to operate legally.

4. Buy an Insurance Policy

Insurance may not sound like something you wouldn’t need when starting the business, but it is very important. You are in custody of other people’s property and anything can go wrong.

Even if you have security, burglars can still break in and steal. Natural calamities such as fire, can damage property and cause losses. Insurance can cover these damages and save you from incurring losses.

5. Find a Premise

Just like any other business, location is a key factor for your business’s success. It should be easily accessible from the road by car. You require enough space to host multiple storage units.

For space, you can buy, rent, or use your own land. Before building anything, it is important to adhere to all the legal requirements such as getting building permits and development approval. 

6. Make Use of a Contract 

Customers planning to use your storage facility should have a service agreement to sign. It should contain payment terms, confidentiality, length of rental, and waiver of liability. A contract reduces the risk of a legal dispute in the future.

7. Secure Your Business Premises

Even if you have insurance to cover any theft issue that may occur, the incidences will make you lose customers. Good security builds trust.

A trusted business will attract more clients who will be willing to pay more provided security is guaranteed. To avoid theft, invest in quality onsite security. Therefore, have the following:

  • Quality lighting
  • Surveillance cameras
  • Perimeter fencing
  • Security personnel

8. Market Your Business 

Even if you have the best storage facility, potential clients won’t know about it unless you market it well. Embrace online marketing. Create a website where you list the services you offer and advertise your business.

Again, you can’t ignore the power of referrals. Invest in quality services and your clients will always invite their friends. Your client base will be growing day by day and you will build a brand that everyone wants to associate with.

Other ways to market include:

  • Community networking
  • Hosting special events
  • Occasionally giving small gifts
  • Use of banners and signage

9. Monitor Progress and Allow Growth

Watch how your storage business progresses and make modifications where necessary. Whenever you encounter a problem, try to find the root cause and solve it.

Don’t get comfortable when the business is doing fine, instead, always look for ways to improve. If the business turns out to be a flop, make use of the exit strategy you developed in the business plan.

Ready to Start a Self Storage Business?

Are you planning to start a self storage business? Take note of these tips, from planning to marketing, to set up a successful firm. Also, remember to monitor progress and make necessary tweaks whenever necessary.

Before you go, check out our blog for more information on starting and running a successful business.