Self-storage titillates investors appetites because there are so many ways to push profits. On one hand, this is a demand-driven business that people need. Study your market correctly, build a nice facility on a good piece of ground, and customers will come to you. Once theyre through the door, though, thats where the push comes in. Take your cue from McDonalds and make this your mission: writing up a big fat average ticket.
Fast-food restaurants learned long ago that a large-soda order pours gallons more money into the bottom line than a small cup. Selling large fries instead of a small bag to each person at the drive-thru can easily increase profits $10,000 a month, even at a slow location. Do you know how the drive-thru concept was born? Fast-food owners knew they were missing business when the counter got busy. People didnt want to stand around, so they went elsewhere. But they didnt mind waiting in their car, did they?
The key to pushing fast-food profits is asking for the order. Two of the most valuable phrases in history are Can I supersize that for you? and Would you like fries with that shake? How do you apply this strategy to self-storage? We dont have soda or friesbut we do have locks, boxes, insurance and truck rentals.
We dont have a drive-thru to satisfy people who might go elsewhere when our phones are busy, but you can contract with a call center. Using a call center to capture missed rental opportunities can account for 15 percent to 20 percent of your rentals.
Weve got to learn to ask for the order. How many boxes will you need today? Which of our locks would you prefer for your unit? Whats your choicethe $2,000 or the $4,000 coverage? I have a 16-foot or a 20-foot truckwhich would fit your things better? and We take Visa or MasterCard to hold a unitwhich one do you have handy? If you are now renting 30 units a month, what could the impact be if you and your staff mastered these phrases?
Here are a few scenarios.
- Lets say you sell $10 in additional boxes to each new tenant. Thats $300.
- Double the number of locks you sell to 20, earning an additional $100. Your net on supplies, by the way, is 50 percent.
- Insurance sales should be successful with 50 percent of new renters. If you make $2 a month commission on each sale (15 x $2), your net would be $30.
Learning to ask for the order with locks, boxes and insurance could easily be worth $2,500 a year in profit. What is wrong with that?
Sell It, Baby
Now increase your rentals from 30 to 34 a month because your call center is renting units from those callers you wouldnt have talked to without the service. Not only does that send rental income to your bottom line, which could easily average $600 or more per contract, it gives you four more people to super-size with locks, boxes and insurance.
Dont forget truck rentals. The commissions on local moves keep a little revenue flowing each week. And when you do a one-way, you get a nice chunk of change to send to the bank. Having trucks available draws people to your store. Not all your truck customers will rent a storage unit from you, but some will, and those are rentals you probably wouldnt have landed without the truck. Plus, truck renters buy a lot of boxes and moving supplies.
Since I am writing a sales column, my last word to you is that offering these add-ons is not enough. You have to sell them. Each item carries a list of conveniences and value-adding propositions for your customers. First, dont let any potential customers get away from you. Second, show them why its beneficial for them to get their locks, boxes, insurance and trucks from you. Finally, ask for the order. If they dont say yes, ask why they dont think these additional products and services are a good idea. Re-sell your valuable offering in terms of the customers resistance, and then ask for the order again.
Many sales are made to people who say no the first time they are asked to make a purchase. No is not the end of the conversation. No just tells you how to direct the conversation. Dont be afraid to ask for the sale and push up profits!
