Inside Self-Storage Magazine 9/98: Ask The Waldmans

DEAR WALDMANS: We are one of those facilities that are not run with a computer. Our business seems to run just fine, but I get tired of people telling me I need to be computerized--that I would make more money and that it could save me time. Honestly, everything works just fine now. I have all my paperwork in order, my tenants are happy and I am not committing a crime by having my papers here and there. Why can't people understand that I am not a failure because I am not a computer buff? So, in all the success I've had without my computer, my best friend recently told me how I was losing money without one. He, of course, has a computer (even though he doesn't know a whole lot about it) and said I was losing money each time I pro-rated a unit, such as when the tenant moved in on the middle of the month. Of course, I didn't believe him--until he showed me. Now I'm beginning to believe that a computer system would indeed help. He never explained his theory of pro-rating with and without a computer. What's your take on the situation?
--Counting My Cash in Dallas, Texas

DEAR COUNTING MY CASH: I'll bet you were floored when you found out you were losing money. It is always a hard thing to swallow when a friend tells you how you are losing your own money. After all, what are friends for? This is so simple to understand, you will hate yourself for not figuring this one out. But, that's OK, your friend makes mistakes, too. You'll just have to find one of his mistakes and throw it right back at him. Now, let's look at pro-rating a unit by hand. As an example, let's use a unit that costs $100 a month. Say your tenant moves in on the 10th day of the month. By hand, you would take $100 divided by 30 days and it equals $3.33 a day. So, now you subtract 10 from 30 to get to 20. Now 20 days multiplied by $3.33 equals $66.60. If the computer calculates the same pro-rated situation, it would take the day the tenant is actually renting the unit. This would give you 21 days instead of 20 days. Therefore, 21 multiplied by $3.33 equals $69.93. You are shorting yourself $3.33 by calculating the equation by hand because you are starting with the next day, instead of the real day the tenant rents the unit. If you rent 300 units a year by the hand calculation (losing the day the tenant actually moves in) then you will lose $999 a year. What a loss to your business. If you want to gain this money by hand, make sure you add that extra day back--the actual day the tenant signs the lease. See how simple that was? So easy to lose so much money.

There are so many things that we do in business without thinking. Friends are really great to discover some dos and don'ts. By sharing information, we gain knowledge by experiences and we learn by our mistakes. Never be afraid or embarrassed to ask for help or an explanation of those things we don't understand. All of us had to learn, and all of us make mistakes. Intimidation sometimes occurs with such rapid technology. If you feel good about your system, don't ever let someone pressure you into moving into something you don't feel comfortable with. That goes with everything in life. However, always take the time to investigate new technology. You might find some other money-saving features just by looking and listening.

The Waldmans, a father-daughter team, are self-storage owners/operators and attorneys. In addition, Ms. Waldman holds a Master's degree in Labor and Employment Law from Georgetown University. The Waldmans are co-authors of the industry's leading series of books on self-storage operations: Getting Started, Forms, Policies & Procedures and South Carolina Tools. Another creation of Ask the Waldmans are their colorful posters designed exclusively for the self-storage industry.

Views and opinions on legal matters are those of the authors. Professional counsel should be obtained before any determination or positive action is taken.

Inside Self-Storage Magazine 9/98: Ask The Waldmans

Article-Inside Self-Storage Magazine 9/98: Ask The Waldmans