In the world of self-storage, not many products have come along to revolutionize the way individual door-alarm security systems are installed. Quick Switch has developed a new door-switch design that has completely altered the function of door-alarm contacts. The company was started by Bill Carlson and Dan Jolley, who have more than 25 years of experience in the security and alarm market. It has grown to become a provider of all types of switches, with its own overseas manufacturing plant.

The Product

The old-style contact switch for self-storage doors was designed to detect the position of the door. The Quick Switch detects the position of the latch. Thus, it not only indicates when a door has been closed, but whether it has been locked. This added security information is just one of the product's many benefits.

Because the switch mounts on the door track, it is out of the way. This means no more overhead magnets to be broken off or floor switches to be pulled from the concrete. The switch is also protected from the elements, and its operation is temperature-resistant. Installation is quick and easy, saving significant time and labor expense. That savings can be passed on to the owner/developer. Quick Switch now offers on-site installation assistance for sizable first-time users.

Extensive testing has gone into the evolution of this product, which has undergone several changes. The switch functions with all the major self-storage alarm systems, including Sentinel Systems Corp., Digitech International, PTI Integrated Systems, QuikStor Security & Software and Wham Security Systems. Major door manufacturers have specified the proper door latch to match the product.

Informed owners are now requesting the Quick Switch for new developments. Active security dealers are experiencing the ease and convenience of using the product. The company looks forward to continued success in supplying the industry standard for self-storage door alarm systems.

The Company

Quick Switch manufactures various electronic components for security, telecommunication equipments, process-control instrumentation, electronics-test equipment and office-automation equipment. The company has a consistent record of growth and expansion, with rapidly increasing sales over the last 10 years. It has a strong team of qualified engineers to look after the production, marketing, and research and development functions of the company. Its products meet all IS/JSS specifications, and all individual components pass stringent quality-performance checks backed by the latest test facilities available.

Quick Switch enjoys the support of a wide customer network in the government, public and private sectors. The company has committed resources and engineering efforts to develop a complete line of high-quality products that would best suit a wide variety of applications. It also has a large in-house capacity to meet bulk-volume requirements. For more information, call 866.784.2511 or visit www.quick-switch.com.

How does discounting my rental rates affect length of occupancy?
Is a $1 move-in special more profitable than giving rental discounts?
What percentage of my tenants pay a discounted rent?
When does offering automatic rent collection make financial sense?
How many hours a month does my manager work on site?

Today's management software has some amazing reporting power, but to answer all these questions, you will need a report no one else has previously created. Microsoft Excel can provide the answers--if you know how to ask the questions.

This is the part one of a two-part column. At first, the procedures noted may seem a bit technical, but the step-by-step guidance will get you to the finish line in minutes. Best of all, you can save the finished report and update the information any time you need current answers.

Let's Get Started

First, create an easy export feature for your management software. You can do this by using your mouse to click on your computer's START button and selecting Control Panel to open a window with choices. Select Printer and Faxes, then Add Printer. The drop-down port selector must be set to File, and the location should be set to Local. Choose Generic as the manufacturer, with the model being Generic/Text only. Click on the OK button to complete the printer setup.

From this day forward you can send any printable report, from any program, to the "Generic" printer. The output will be saved to a text file you choose. You do not need to do this step again. Have your management software send the master tenant list to the generic printer and save the output as "Master_List.txt."

Click START, Programs, Accessories, then choose Wordpad. In Wordpad, choose File, then Open. Change the file type to All Documents (*.*), and locate the file called "Master_List.txt." You want to remove anything that is not in row-column format. Delete any additional information in the very top or bottom rows, such as your site name, address and anything else not relating to tenant data. When you are done, select Save from the File menu and exit the program.

Now open Microsoft Excel and choose Open from the File menu. Change the file type to All Files (*.*), and locate "Master_List.txt." The program will ask you to highlight the columns of information you don't need. Keep only three columns: Street Rent Rates (column A), Actual Rent Being Paid (column B) and the Tenant's Move-In Date (column C). Here is a short sample output representing a very small facility:

Excel will letter the columns and number the rows automatically. The intersection of each row and column is a rectangular area called a cell. The program lets you place a value or formula at any cell location. By creating your own formulas, you can extract patterns and meanings to the data table you just created.

What percentage of my tenants pay discounted rent?

Our sample table has only a few lines, so we can easily see we have seven rented units. But if we had hundreds of units, we would need a formula to quickly provide the answer to this question. We will place our formulas in column D and explain their meaning in column E.

Highlight cell D1, type =COUNTIF (B1:B9999,">0"), and press ENTER. The cell will display the total number of tenants paying any rent. This total will ignore vacant or damaged units, those being used for the company, and any others where rent is not currently being paid. So you remember what cell D1 means, move to cell E1 and type "Rented Units."

Now highlight cell D2, type =100*D1/ COUNTIF(A1:A9999,">0") and press ENTER. The cell will display your occupancy as a percentage of all your units. Move to cell E2 and type "Percent Occupancy."

Looking at our table, it is easy to see four tenants are paying less than the scheduled rent. We are comparing the value in column B to see if it is smaller than the corresponding value in column A, but only for units paying rent. To write this question as an Excel formula, highlight cell D3 and type =SUM(IF(B1:B9999>0,IF(A1: A9999>B1:B9999,10)),0). Then hold down both the SHIFT and CTRL keys while pressing ENTER. This last step instructs the program to use data sets. Curly brackets are automatically applied to the ends of the formula as confirmation. Move to cell E3 and type a definition, "Tenants Who Pay a Discounted Rental Rate."

The answer in cell D3 divided by the answer in cell D1 is the ratio of how many tenants are paying below the scheduled rent. Highlight cell D4, type=100*D3/D1, and press ENTER to see this ratio listed as a percentage--57.14 percent in our example. Move to cell E4 and type "Percent of Tenants Paying a Discounted Rental Rate."

How does discounting my rental rates affect length of occupancy?

Now that you know the percentage of tenants who have special pricing, let's see if those who pay a discounted rent stay shorter or longer than those who pay the standard rate. Let's only consider tenants paying a discounted rent and list the answer as the average number of months. Highlight cell D5 and type=SUM(IF(C1:C9999"",IF(A1:A9999>B1:B9999,DAYS360 (C1:C9999,"6/1/03"),0),0))/(30*D3). I used June 1, 2003 as our date. Be sure to use the current date, and don't forget to hold down both the SHIFT and CTRL keys while you press ENTER to submit this formula. Move to cell E5 and type "Months of Average Occupancy for Discounted Tenants."

We can change our focus to look only at tenants paying the scheduled rent by highlighting cell D6 and typing =SUM(IF(C1:C9999"",IF(A1: A9999=B1:B9999,DAYS360(C1:C9999, "6/1/03"),0),0))/(30*(D1-D3)). Hold down both the SHIFT and CTRL keys while pressing ENTER, then move to cell E6 and type "Months of Average Occupancy for All Other Tenants."

We are looking for the difference between these two values. Highlight cell D7 and type =IF(D5>D6,100*((D5/D6)-1),"NO"). Press ENTER, move to cell E7 and type "Percent Longer Tenancy From Discounting Rental Rates."

How much money are you giving away in rent discounts?

Highlight cell D8 and type =100-100*SUM(IF(B1:B9999> 0,IF(A1:A9999>B1:B9999,B1:B9999,0),0)) /SUM(IF(B1:B9999>0, IF(A1:A9999>B1:B9999,A1:A9999,0),0)). Hold down both the SHIFT and CTRL keys while pressing ENTER. Then move to cell E8 and type, "Percent of Lost Revenue on Units With Discounted Rent." Your spreadsheet should now look like this:

From our table, we can see the tenants who receive a rental discount are staying 4.32 percent longer but generating 8.62 percent below street-priced revenue. This is a significant income loss for minimal gain. The small increase in the length of occupancy indicates renters are not very price-sensitive. This facility is nearly 90 percent occupied, and it is time to raise rents. Excel took the guesswork out of our rent management. Now that's power.

Next month, we will use Excel to compare the value of the $1 move-in special, evaluate the real costs of offering automatic rent collection, and show how to analyze employee work hours.

Doug Carner is on the Western-region board of directors for the Self Storage Association. He is also the vice president of QuikStor Security & Software, a California-based company specializing in access control, management software, digital video surveillance and corporate products for the self-storage industry. For more information, call 800.321.1987; e-mail doug@quikstor.com; visit www.quikstor.com.

Permits and Licenses

Permits, as required by law, were not secured for the pyrotechnic display the performing band used the night of the Station fire. If you are installing a door-alarm system and access-control gate at your facility, specific permits and licensing may be required by your state. Check with your local building officials and State Department of Business Regulation. Simply having an electrical permit for your electric service and lighting may not be enough to comply with the law.

The contractor doing the security installation may need a separate data-communication license. Some states require all workers on site have this license for low-voltage installation work. This would apply to door alarms and access-control gates. There may be a further requirement that all workers have a security badge, requiring their fingerprints be documented and registered with the FBI.

Once your security system is installed, you have the option to have an independent alarm company monitor the system and report to your local police station. Having an installation company with security-badge clearance is important, as you have a substantial investment in your facility. Asking your contractor to be properly permitted and licensed is a reasonable request.

Proper Insurance

After the Station fire, records indicated the night club had no worker's-compensation insurance. Most states have a law requiring a business have this coverage. If it does not, it can face civil and criminal penalties. The insurance is important for two main reasons:

• It generally pays a portion of lost wages and provides medical coverage for a worker who suffers a work-related injury.
• It generally protects a business and its owners from liability if a worker is injured or dies on the job. If a business does not have the coverage, a worker (or his estate) can seek to recover costs by suing the business and property owners directly. In addition, the business owners can be sued personally, "piercing the corporate veil" that typically shields them from liability.

If your security subcontractor "business owner only" is exempt by law, request a copy of the waiver he had to sign with his insurance company. Always have a Certificate of Insurance on file before he mobilizes on site. Also, be listed as an "additional insured" on the certificate. This allows you to correspond with the insurance carrier. You are entitled by law to be listed as an additional insured. Again, you have a substantial investment in your property. Make sure your contractors are properly insured.

Safety and Liability

Blame is being pointed at just about everyone related to the Station fire. The costs of the litigation may exceed the limits of the insurance policies. If someone is injured while working on your property, what precautions did you take to prevent this from happening? To simply comply with the law is not enough. Most self-storage facilities have automated security gates. One crucial precaution is to comply with UL 325.

What is UL? Underwriting Laboratories Inc. is a not-for-profit organization that was established in 1894. Its primary mission is to "evaluate products in the interest of public safety." A UL label is not generic--it represents a brand name, and there are other organizations that provide safety-testing standards. According to the Occupational Safety and Health Administration, electrical equipment is acceptable if it is listed by a nationally recognized testing laboratory. UL 235 is a specific code standard that addresses the prevention of personal injury from automatic gates.

For example, UL 325 states that gates with picket spacing of more than 2.5 inches requires a safety mesh. There are many other safety standards within the UL 325 listing. It is voluntary for a manufacturer of gates and gate operators to participate in the UL process. However, in the future, states or municipalities may mandate the code standard. If you are ever sued for a workplace injury related to facility security and its installation, make sure you took all the steps possible to prevent it.

Al Costantino, owner of Northern RI Self Storage Inc., is new to the self-storage industry. With a background in government and commercial contracting, he is currently building a 100,000-square-foot facility in Smithfield, R.I. For more information, call 401.232.1000.

When referring to self-storage, the phrase "set 'em up and sell 'em on" makes the whole business sound so simple. Last year's acquisition of Aardvark Self Storage Ltd. and Rent-A-Space by Mentmore PLC demonstrated the "sell-out" most dream of may have been oversold. But the big sale has become significant news because of its positive impact on the fledgling European marketplace.

I'm a great lover of win-win situations, and I think any market sell-out or takeover is good news for all involved. First, the small guy who sells makes a bundle—subject to his assumed debt—for his hard work and risk. Second, the buyer gets profit-making power, positive cashflow, and a site at a good discount to its 85 percent occupancy earnings potential. Third, good news travels fast. The industry gains credibility in a sale of this nature, which leads to more lending for small and large operators alike.

And so the cycle should continue—even in times of war and recession. Our fantastic product will seem safer and safer in investors' eyes, especially when profits are proven by the "big guys" in the not-too-distant future. But back to the point: Nothing is ever this simple, even self-storage—if it were, everybody would do it. Even when you have the necessary time, financial resources and expertise to set up a small chain of facilities, it doesn't mean you will be able to sell it at your target price, let alone find anybody who wants to buy it.

Taking this into consideration, the best thing to do is build to operate, not sell. That way, you can't lose—if you can fill the place, of course. If you want a steady, pension-style income, set up one facility, get it profitable, and sit back and reap the best return you could ever get on a self-administered pension scheme. But if want more excitement (and risk), open three facilities in three or so years and try to secure a sell-out.

The most important piece of advice I can give anyone who fancies his chances of a multifacility set-up and sell-out is location, location, location. Wake up! I'm not talking about a nice drive-by location, I'm talking about the strategic location of sites in relation to the "big boys." You need to research and find an underdeveloped area for your facilities within an established self-storage market.

For example, France, the Netherlands and the United Kingdom all have established self-storage marketplaces in key cities or large urban areas; yet the bigger players are still concentrated and generally represented in only a few regions in these countries. So don't go and set up in a competitive market with plenty of current supply—like London, for example. Focus on under-represented cities or large towns and urban areas in the provinces. OK, the going might be tougher initially, but again, it's a win-win situation. You benefit from being the pioneer, and you don't have to operate in a price-cutting environment. Think positive!

One major reason the large operators have focused on London and Southeast England is because, quite simply, it's easier. It's easier to fill facilities, and easier to build brand awareness and critical mass in a more educated, space-starved market (although recently, supply may have exceeded market demand in some hot spots in Greater London.) So if you understand the big boys' logic and model, copy it.

Focus on building your small chain of high-quality facilities with a strategic outlook. Find an area where you feel a big operator might eventually want representation and build a small chain of sites that fit well together on the bigger area map. You create value because you end up with sites that allow potential buyers to expand within and near the area, justifying a regional infrastructure to build more facilities and marketshare. Suddenly, your sites have value and appeal—but only, of course, if you can tick the rest of these items off the list:

• The facilities must generate month-on-month operating profit.
• Although producing profits, the facilities shouldn't be full.
• The facilities must be second or third generation.
• The facilities must be in good drive-by locations.

I said it wasn't as simple as it sounds. Let's be honest—for the new operator, it's bloody hard work finding a single site, securing it, financing it and filling it. It takes time and commitment, and is a long way from a strategically located chain. It is possible, and if you can successfully build one, the second is certainly easier. If you can establish a good monthly income stream in the first six to nine months of opening while looking for a new, tactically located site, you're a winner. If you can prove to yourself and your financier that you can build one from start-up, hopefully, the next facility will come along in time.

Now let's talk about sell-out valuations. We'll keep it simple. I am going to suggest the easiest way to value a facility in Europe is to predict what the site could make when 90 percent occupied (deemed full). If a facility for sale is in month-on-month operating profit and 65 percent to 70 percent occupied, the buyer and seller both win. The seller sells at eight to 10 times his annualized monthly revenue—less debt—and the buyer, although buying at eight to 10 times the revenue, is, in the long term, getting the facility at three to four times its value.

When you look at selling your business as a going concern at eight to 10 times current earnings, it sounds fantastic; but when you consider you've already done the hard work—getting the business to break-even—and that, in the long term, you're only getting three to four times future earnings, it may be time to reconsider whether you want to sell at all. So what's the solution? Build to operate but within a strategic framework. That way you're in control, and you can consider the sell-out when a window of opportunity is open.

Andrew Donaldson is chairman of Active Supply & Design (CDM) Ltd. and Storage World Self-Storage Ltd. He established, built and sold a chain of facilities in the United Kingdom to a PLC formally known as Rent-A-Space. He is also chairman of The Princes Trust in Cheshire, England, and a former director of the Self-Storage Association of U.K. & Europe. For more information, e-mail andrew@askactive.com; visit www.askactive.com.

Keyboards, mice, printers... It's not exactly riveting dinner conversation, is it? Au contraire!

New technological products on the market include keyboards that reduce hand fatigue, read driver's licenses and credit cards, or have an integrated trackball. Wireless microphones provide hands-free typing, and there are printers so complete they fax and copy, or so portable a manager can print a lease while standing beside a rented unit.

If your site is large, you may have one staffer who spends most of his day entering data into the management computer. This level of use can lead to a repetitive strain injury that reduces his typing efficiency and may burden you with a worker's compensation claim. The problem is a standard keyboard causes the human hand to twist at an angle. The easiest solution is to use a split keyboard like the Microsoft Natural Keyboard Elite 2.0 ($30).

Another clever keyboard is the UniTech K2724 ($150), which has a built-in magnetic card reader. If your management software supports on-demand credit-card processing, this keyboard with save you time and reduce typing errors. You'll also receive the lowest merchant-banking fees available.

Management software requires constant hand travel between the keyboard and mouse. The DataDesk TrackBoard ($63) has an integrated trackball that replaces the mouse. Unless you have ever tried a trackball, you might not appreciate its ease of use. Having a trackball in the keyboard minimizes hand movement while your eyes stay focused on the management screen.

Voice-recognition software is an alternative to using a keyboard. The software installs on your management computer and analyzes your voice commands. This is a great tool for writing letters and issuing keyboard commands. When paired with a wireless microphone, you have a powerful office tool. The ever-popular Naturally Speaking Preferred 7.0 by Dragon is only $145. However, voice-recognition software won't save you time entering a new tenant's information when the name or address is difficult to pronounce.

A more common input tool is the scanner, which is a tabletop unit that digitizes leases and driver's licenses for permanent storage within your management computer. Scanner software lets you print copies or translate the image into a text document. A good quality 600x1200 resolution scanner will run you less than $80 and represents an indispensable office tool.

You can acquire a single unit that is scanner and printer, but combining hardware does not ensure the best of both products. In fact, these do-everything units use complex software that may be problematic to your computer's stability and performance speed.

It is safer to purchase a printer as a separate device. Personally, I am partial to the Epson brand. Its units are fast, quiet and rarely need servicing. Epson paper trays are large, and the ink cartridges are reasonably priced. If portability is your strongest need, try the Canon I-70 color bubble jet ($280). It weighs only 6 pounds (with an optional I-50 lithium battery) and is quite portable. When used with a wireless laptop, it can print lease agreements from anywhere on the facility grounds.

My favorite computer accessories is the Flash Pen Drive. My CD Cyclone 64MB ($40) allows me to easily back up data files and critical programs in seconds. I just plug the thumb-sized unit into my computer's USB port and I can instantly drop and drag the files I need to copy.

Finally, I recommend you put a sound card ($25) into your management computer and add some speakers ($15). Some self-storage software includes dozens of video tutorials that use your computer's sound system. This is a fantastic way to train new employees and refresh the experienced user. This alone can reduce your expenditure on technical-support calls.

There are dozens of other gadgets that connect to a computer, but it is important to remember this is a business machine. The management computer should be powerful enough to get the job done but not so heavily accessorized as to make it unstable or a source of distraction for the manager. I remember one facility where the manager had installed dozens of multimedia programs and then wondered why his management computer became unreliable. My advice is to keep it simple.

Doug Carner is on the Western-region board of directors for the Self Storage Association. He is also the vice president of QuikStor Security & Software, a California-based company specializing in access control, management software, digital video surveillance and corporate products for the self-storage industry. For more information, call 800.321.1987; e-mail doug@quikstor.com; visit www.quikstor.com.

The first security element that impacts a visitor is your facility layout. Your goal can be expressed succinctly: maximum visibility with minimum accessibility. Stand out from the competition with a welcoming and professional appearance, but keep security as the guiding principle. Limit the number of access points to your facility. Less entrances mean fewer areas to monitor. Whenever possible, create "sight lines" so you have visibility to your units from the office. Including those sight lines in your design is a low-cost way to present a visible deterrent to crime.

Gates/Access Control

Keeping in mind the importance of limited access points, make sure all of your entrances and exits are gated to prevent unauthorized vehicles from entering your facility. A keypad-access system that links the latest technology in access control with your property-management software enhances command of your property and will convince your renters their security is paramount. Linking gate control with your management system enablers you to lock out nonrenters right at the gate.

Exterior Lights

A well-lit facility not only discourages the bad elements, it also keeps customers and staff safe from accidents. Linking your lighting to a time-operating system keeps your electricity costs down and ensures lights are turned on at the appropriate times. Motion-controlled lights also prove to be very effective in low-traffic areas. These systems cause quite a shock when the lights kick on, but for true safety and security, keep those traffic areas lit up.

Cameras

Cameras are essential for keeping a watchful eye on the happenings at a facility. Even with a full staff, most facilities are spread over large areas, so think of cameras as an operator's extended eyes. Though cameras are looked at mainly for their role in the security chain, they are also vital for safety.

The technology with these systems has advanced very rapidly. At this point, VHS technology is a dead end. A digital system gives you greater storage capacity and indexing, and will allow upgrades when you need them. There are many options available to fit any budget, but keep in mind this investment is vital in keeping your facility secure and safe. There are many companies out there that can sell you a surveillance system. Shop around, and look for one with a track record for servicing businesses like your own. You may also want to consider a remote-access option some surveillance companies now offer. Using the Internet, you can view your site on a remote computer or even some hand-held devices.

Know Your Renter

The days of running a quick and light security check on your renters have long passed. At a minimum, the most successful sites follow simple procedures such as photocopying IDs, taking photos for records, performing credit checks, and verifying the phone numbers they register. These simple steps are a great deterrent for renters with bad intentions. Most criminals will naturally look for a base with lenient security. When these procedures are presented properly, they enhance the confidence of prospects and renters while deterring the bad guys.

Another tool many sites take advantage of is local law enforcement. Some self-storage operators volunteer their facilities for K9 training or work on area crime watches. The whole key is getting involved. Again, publicize your security. An attractive sign and a picture of an officer and his canine partner will have a reassuring or a threatening effect, depending on the prospect.

Door Alarms

Alarm-system technology has come a long way in the past couple of years, and more and more facilities are being built standard with these systems. There are a great many older self-storage facilities that have retrofitted to bring themselves up to speed. There are quite a few different ways to set these systems up, whether hardwired or wireless.

In most circumstances, building in your wiring during the construction phase is the most cost-effective and reliable route to take. Check references, and look for an installer who has worked with configurations similar to yours. It is also critical to make sure your system has some sort of back up, such as a cellular signal, in case the main power source is cut. Alarms are a powerful deterrent in preventing crime, but don't invest in something that can be immobilized with the loss of a power source.

Resident Managers: A Thing of the Past?

Self-storage facilities have long been known for having resident managers to provide an extra measure in security as well as customer convenience. Though this has been a practice for many years, some operators are moving away from it. The technology in security systems is so advanced you can monitor your facility from a hand-held device like a Palm Pilot. Some groups also feel managers get burned out more easily when they are on site 24/7. The managers who don't live on site have proven to be more enthusiastic about performing their duties.

Locks

The last line of your security, and a key marketing advantage, is your lock system. Some operators make the mistake of lumping locks with boxes, tape and other retail ancillary products to sell for a profit. Locks are not an ancillary product, and security is not an option in self-storage. It is a necessity, and you cannot market or provide security without a high-security lock system. Lock systems are not an option to leave with the renter any more than door alarms or security cameras. A cheap padlock--whether you sell it or the renter provides it--signals to everyone at your facility that you are not serious about security.

The minimum level in lock security is to sell or provide disk locks. Disk locks have a 'hidden" shackle that can slow a thief. Lately, however, thieves have discovered it is just as easy to cut the slider around a disk or any lock as it is to cut a shackle. Disk locks may now be offering the worst kind of security-false security.

Because of the potential vulnerability of a latch, even when secured with a disk lock, you should consider investing in a cylinder latch system if you are in a high crime area, or if you are emphasisizing security as a marketing advantage. A cylinder lock and latch system buries the lock mechanism inside the door and presents a uniform face to a potential thief.

Faced with a row of doors, uniformly secure with a flush-mounted front, a thief will likely move on. Or, if he was thinking about renting from you, he may change his plans. With a deposit and administrative-fee system, you can recoup the price of the system over a few rentals, and more important, you can ensure every link in your security chain is secure. A cylinder system delivers the same deterrent/reassurance effect as access control, security procedures and the other components of a comprehensive security program. It puts barriers in front of bad elements and demonstrates your security commitment to the renters you want.

This is a basic outline of key elements of security for your facility. However, each site is different. The most important piece of advice we can give operators old and new is to consult with professionals in each area. Sometimes it seems new products are developed every day. Long-term commercial renters as well as average customers will feel more comfortable storing their belongings with you if they see you are taking steps to protect their investments. There is a great advantage in separating yourself from your competition through marketing your security program.

The self-storage marketplace is getting crowded just as the economy appears to be slowing. You can compete for renters with price and degrade your profit margin, or you can compete with features. Security is one feature that continues to pay well after your initial investment. Not only does a genuine visible security program prevent theft and crime--and the resulting cost and bad publicity--it provides a tangible way to stand out against the competition. A serious security program also attracts long-term commercial renters and higher-end residential customers.

Rich Morahan is the managing editor of The Self-StorageTelegram, a quarterly magazine that focuses on security, marketing and operations issues in the self-storage industry. He can be reached at 617.559.0177 or rmwrite@attbi.com.

Chris Shope is the vice president of sales and marketing for L.A.I. Group (Lock America Inc.), which manufactures and distributes locks and security hardware for the self-storage, gaming, vending and coin-op industries. He can be reached at 704.824.8363 or lailocks@bellsouth.net.

The U.S. Chamber of Commerce reports that in the United States alone, billions of dollars vanish every year due to employee theft. Stealing is a severe threat to any facility, and it only takes one or two people to cause financial chaos. Owners should recognize the risks, deter dishonest employees from their facilities, and understand the benefits of employee-dishonesty insurance.

Theft can be committed by one employee or several. Forging and hiding receipts, pocketing loose change and stealing merchandise from the managing office are common practices. There have been reports of managers creating bogus payrolls, overbilling expenses and committing purchase fraud. Theft can even go as far as breaking into storage units and stealing tenants' goods. Some offenders have actually taken advantage of their employment by breaking into units in the off hours and calling the police to report the crime the next morning.

So what can you do to protect yourself from employee dishonesty? Employee theft can be hard to detect, especially if the criminal is good at what he does. There are several ways to keep a closer eye on your facility and minimize the risk of theft. Start by watching out for unusual occurrences in your facility, such as discrepancies of cash amounts and missing supplies and merchandise. Take notice of your employees' behavior. Watch for unusual working hours, poor work performance, constant complaining and defensive behavior when discussing work issues.

Implementing an anti-theft regime in your facility can also reduce your risk to exposure. Employees will be less likely steal from you if they think there is good chance of being caught. Perform regular surprise visits and audits to keep track of any merchandise or receipt problems. It's recommended to have managers and accounting personnel take vacations so the fill-in can be used to double-check for payroll and accounting discrepancies.

Set up surveillance in key areas such as the managing office and storage areas. Not only will surveillance keep a record of events, it can also help deter theft from outside burglars. Avoid retaining tenant keys to eliminate access to tenants' goods. Most insurance companies won't write policies for storage owners who retain keys because of the increased risk factor.

Know who you are hiring. Some people have theft in mind from the beginning, and you should avoid hiring these people by conducting thorough background checks and obtaining previous job references. Last but not least, if you have many employees, it might be beneficial to start an awareness program. By doing so, you can inform workers about stealing and keep them on the lookout for theft.

In addition to deterring crime, secure an adequate amount of employee-dishonesty insurance. Unlike those from burglary and robbery, losses due to employee dishonesty are excluded under most commercial policies. Many owners do not realize this coverage can be just as important as fire or liability insurance. Crime coverages can protect against losses from robbery, burglary, theft, embezzlement and other risks, and can be tailored to fit the size and scope of your self-storage operation. In most cases, your business-property and liability package policy can be endorsed to provide coverage against employee dishonesty, loss of money and securities from your premises, and loss of other covered business property such as computers.

One important point to remember about employee-dishonesty claims is the act must have been committed with "manifest intent"; in other words, the loss must be the result of an unethical act, such as lying, through which the employee sought personal gain. Without manifest intent, such claims are generally disallowed.

Also, inventory-shortage claims are excluded from employee-dishonesty policies because losses can occur from a variety of reasons beside theft, such as accounting errors. Consider also that money and security claims and business-personal claims are not the only losses that can be covered under employee dishonesty. Endorsements might be available to protect you against check forgery, credit-card misuse and computer fraud to supplement your existing protection at extra cost.

Universal Insurance Facilities Ltd. offers a comprehensive package of coverages specifically designed to meet the needs of the self-storage industry. For more information, or to get a quick, no-obligation quote, write P.O. Box 40079, Phoenix, AZ 85067-0079; call 800.844.2101; fax 480.970.6240; e-mail uif@vpico.com; visit www.vpico.com/universal.

Three words can describe the new technological innovations happening in the CCTV industry: digital, digital, digital! Everywhere you look there is some sort of new digital product or technological innovation on the market that offers to make a video-surveillance system smarter, smaller and more cost-effective. Trying to keep all of this information straight is quickly becoming a full-time job for even the most seasoned security experts. If you take the time to read this article, you will find information beneficial to you, whether you are considering buying your first system or upgrading an existing one.

While the security industry has gone through a major technological revolution over the past couple of years, there are a few main areas where the improvement has been drastic. Those are the evolution of day/night cameras, wireless signal transmission, and what has been the biggest revolution in the CCTV industry in some time, the advent of digital recording.

Day/Night Cameras

In the past, an organization would have to first decide its No. 1 priority when deciding on a security system. Was it more interested in obtaining the additional detail color cameras provide (as long as there was enough light), or the increased visibility a black-and-white camera would provide in low-light situations? That decision is one that no longer needs to be made thanks to the advent of the day/night camera.

In its simplest form, a day/night camera is actually two cameras in one chassis. When enough light is available, it produces high- quality color images that provide crisp detail for the viewer. However, when the amount of available light drops below a certain level (usually preset by the manufacturer, but in some cases, selectable by the consumer), the circuitry in the camera switches to a black- and-white signal, allowing for continuous surveillance in almost any lighting condition.

Wireless Signal Transmission

Expensive, cumbersome and unreliable were once accurate descriptions when talking about wireless systems. Today, these adjectives are being replaced with cost-effective, powerful and inconspicuous.

Wireless systems have changed dramatically in the recent past. Now, many people consider them a viable alternative where hard-wired (coaxial cable) systems may not be an option. Wireless systems offer multiple channels--in some cases, up to 10--and a wide range of transmission spectrums, from 900 MHz to 5.4 GHz. This virtually ensures a clean signal when working with a direct line of sight. They have also become quite cost-effective when faced with laying long runs of conduit or having to trench an existing facility.

While wireless technology has come a long way from its earliest forms, a word of caution is still in order. Just because you have an effective wireless system when it is first installed, outside influences still have a chance of causing problems down the road. This is due to the increased use of wireless and cellular technology in the consumer market.

For example, most wireless phones in use today operate on a 900-MHz cycle. However, as people replace their current wireless phones with new ones, they are purchasing systems that run on 2.4-GHz cycles, which is where most wireless CCTV systems operate. Also, cellular towers are popping up everywhere it seems, and while they might not be running directly on 2.4 GHz, they are still throwing off signals that can cause interference with your wireless system.

Phone-Line Video Transmission

Until recently, the only way to see what was going on at a facility at any given time was to actually be at the site. This would lead to a lot of windshield time if a person had multiple sites to manage. Now imagine being able to call up a site at any time, from any location, and viewing what is going on at that very instant.

What used to be a fantasy has become reality. With the advent of phone-line transmission systems, a property owner or regional manager can call up a specific facility 24 hours a day, seven days a week, and see what is going on. Some of these systems are even powerful enough to allow the individual to turn lights on and off, sound alarms, and open and close gates. These systems also have the ability to call a pager, telephone or remote computer if an alarm is triggered. This is an excellent add-on piece to an existing system that can provide peace of mind to those who aren't always at their sites.

Digital Recording

Now we get to one of the largest innovations in the CCTV industry in many, many years: digital recording. In the past, if a company needed to maintain any type of archived library of surveillance recording, it had to switch tapes on a daily basis. This meant staff had to come in every day to switch the tapes or they would record over the previous day's events.

Also, if they wanted to review a tape, they had to use the existing system or buy an identical head-end system. If they used the existing system, they could not record simultaneously. If they bought an additional system for reviewing purposes, they had to assume the additional cost. Consider also that the VCR would need regular maintenance, such as head cleaning and the eventual replacement of all moving parts. Don't forget the quality of the video degraded every time you copied the tape or reviewed it. In the end, a VCR system was a high-maintenance recording medium.

Welcome to the digital age. With the systems available, a person can record a tremendous amount of information on a hard drive--in some cases, upward from 30 days worth of data for 16 cameras. A person can also be recording all his cameras simultaneously while reviewing the past day's events.

Most digital systems also allow the user to gain access to the system remotely via the Internet, a modem-to-modem connection or a LAN/WAN (local or wide area network). This type of access offers many of the same advantages of phone-line transmission, but with additional features such as the ability to view live or recorded video.

Searching for a file is also much easier on a digital system. In the past, a user would have to spend hours going through tapes (provided he was looking at the right day). However, digital recorders allow users to search from such criteria as time, date, alarm event, camera, etc. Digital recording has truly revolutionized the CCTV industry, and it is believed by many that digital recording will eliminate traditional analog recording systems very soon.

As with any new technology, a word of caution is necessary. There are many digital systems available, and it is very easy to choose one that does not fit your needs either because it is too powerful--in which case you are paying for features you will never use--or it is not powerful enough, which means you will have to pay for a new system shortly. A digital system is a major decision, one that should be properly researched. Make sure you deal with a supplier that will be there to support you and guide you to the proper system.

Conclusion

As you can see, the CCTV industry has come a very long way in a short period of time. The new cameras combined with the new transmission and recording mediums available can make purchasing a surveillance system confusing if not overwhelming. Relax; anything you decide to buy will be better than anything you purchased two years ago. You just can't go wrong at this time. However, use caution. Do your research and buy from a company with a good reputation that will be there to support you as you venture into the hi-tech world of CCTV.

Jon Mitchell is the marketing director for Crest Electronics Inc., which manufactures a complete line of video-security products, including cameras, monitors, digital-video recorders, lenses, and all other video-security products and accessories. For more information, call 800.50.CREST or visit www.crestelectronics.com.

I can't believe I'm about to admit this. Some of you will want my head on a platter. But I have to be honest: When it comes to self-storage security, I'm a doubting Thomas. But I didn't know that until recently. Let me explain.

My significant other and I just made a dream purchase: our very first Harley Davidson. A Centennial-Edition Softail Standard in Gunmetal Pearl with lots of chrome. Man, it gives me chills just writing about it. Our feelings toward this mechanical beast border on the obsessive; and like most HD enthusiasts, we are more than willing to forego creature comforts--like a house with a garage, for example--to have and keep our Precious.

But that leaves us with a slight parking dilemma--no garage, no covered patio, no secure shed. Of course, we considered self-storage. And then it hit me--after years of working in this industry, writing and reading about facility security and access control, I wouldn't commit my most prized material possession to a storage unit. Nightmares of scheming renters and dishonest employees flashed through my brain. Cut and replaced locks. Busted latches. Disabled video cameras. Ugliness, all of it.

So what do you say when an industry insider lacks confidence in the product? How can you, as an operator, sell prospects on the safety of their goods when in 2001, 24.6 percent of facilities nationwide reported a theft and/or break-in? (Self-Storage Almanac, 2002).

Since the events of 9/11, there has been insistence on the magnitude of security in every industry. In self-storage, emphasis is placed on tenant screening, ID verification and goods awareness. But let's cut to the chase--I'm not afraid a terrorist is going to hijack my Harley. I have to worry enough about my fellow Americans! And I would bet most renters feel the same way. So when you think about security for your facility, don't invest the added effort just to jump on Uncle Sam's bandwagon. Invest in security because it is imperative, to everyone, all the time, no matter what they store.

In this issue, you'll read about the role facility design plays in security. You'll also find articles on video surveillance, new advances in digital CCTV and wireless technology, access control, and pitfalls of system installation. All self-storage operators know they need security. But how many are really willing to devote the necessary resources? If you don't believe security will make or break you when it comes to a prospect, consider this: If I can think twice about storing with you, what makes you think your customers won't? It's something to think about.

Best wishes,

Teri L. Lanza
Editorial Director
tlanza@vpico.com

The quality of the security system you select is critical. Of course, the location and general appearance of the property plays a major role in attracting customers. However important these basic considerations may be, they represent only part of a facility's attributes. A comprehensive communications system will keep customers informed and offer immediate access to assistance.

A communications system can include a combination of intercom and paging capabilities for convenient customer service. In addition, broadcasted music creates a more comfortable, pleasant storage experience; and broadcasting of canned messages transforms the communications system into a savvy marketing tool. While the system incorporates state-of-the-art technology, the price is surprisingly affordable. Once you have purchased a system from a reputable supplier with installation expertise, the benefits are immediate.

With communications technology in place, your storage facility transforms from a silent maze of corridors into a more welcoming place of business. Customer assistance is available at the touch of a button should a problem arise. Important messages can be transmitted in a heartbeat. A wide array of choices exist to enhance customer service through a communications system.

Customer Communications

Imagine one of your customers entering your facility on a Saturday morning. It's hot outside, and he is burdened with a long list of errands and time constraints. Spending one more minute than necessary at the storage unit is the last thing he wants. Although this customer has never encountered trouble with his lock in the past, on this busy Saturday, the lock isn't functioning. After jiggling key and lock to the point of complete frustration, he admits he needs help. Can you sense the mental and emotional state of this customer? Do you think he would rather rush all the way to the office to find the manager, or push a button on a conveniently located intercom and call him directly?

Most customers will never require assistance, but every customer can appreciate that level of service when it is available. Should a problem or question arise, the office managers are as close as the push of a button. "We are here for you" becomes more than an empty promise. By placing two-way intercoms strategically throughout the facility, the manager is ready to assist the customer and resolve any issue at the time help is needed.

The Convenience of Paging

In a world where cell phones and pagers are commonplace, the value we place on being accessible is beyond question. Being able to receive personal messages during a visit to the storage facility is convenient to any customer, but especially to those who make regular pick-up and drop-off trips to their units. Whether they forget their cell phone--or even if they have such a luxury--their family, friends and associates will have a consistent line of communication to reach him.

Similar to the paging/telephone system in a large airport, the facility paging capability integrates directly with the two-way intercom system. Should a call come into the office for a visiting customer, the manager will usually know whether the customer is on the premises. A facility-wide page can request the customer contact the manager via the intercom. This approach makes it possible for the original caller to remain "on hold" for a quick answer to an urgent question.

A Pleasant Storage Experience

Along with paging capability comes one of the most appealing features of a facility communications system: the potential to fill the air with soothing music. The value of music as a calming, uplifting influence has been proven again and again. Silence seldom prevails in public areas where an atmosphere of warmth and comfort is important. In fact, our culture is so accustomed to the lulling effect of background music that we are not always consciously aware of it playing. Still, we respond emotionally.

Today's self-storage facilities focus on high security, including controlled access, individual door alarms and surveillance. The addition of facility communications, especially the constant flow of music or another human's voice, can diminish the sensation of being alone and enhance the feeling of security. Knowing that assistance is available at the touch of an button adds even more subliminal reassurance.

Enhancing Profitability

Have you ever called a business that promoted its image, products or services in a recorded message that played while you were waiting to speak to a representative? A complete and comprehensive communications system allows a facility to promote its unique special offers, products or policies. These prerecorded promotional broadcasts can be a powerful marketing tool that increases profitability.

Studies show customers remain at their storage units an average of 20 minutes per visit. Perhaps you are offering a special incentive for customers who refer new business to your facility. Maybe you are introducing new merchandise for sale. Through a comprehensive communications system, the possibilities are endless for promoting and enhancing the facility, extending customer appreciation, offering helpful storage hints, conveying important announcements or all of the above.

From the moment you introduce a potential customer to your facility, the added convenience and service of your communications system can serve as a strong selling point. Any advertising, including direct mailings, posters and signage, that highlight these service-oriented benefits will attract prospective customers above and beyond the competition.

The Overall Value

Communications systems provide value-added service to any self-storage facility, from sprawling single-story properties to multistory structures with long hallways and elevators. Each of the system's features can be customized to a facility's exact needs: quality and number of intercoms and intercom placement; music sources, including CDs, radio or tapes; and frequency and content of broadcasted messages. When the goal is enhancing the overall appeal of a self-storage facility, adding a communications system is one of the simplest and most cost-effective solutions in today's self-storage market.

Karen Genualdi is a marketing representative with Scottsdale, Ariz.-based PTI Integrated Systems Inc., which offers a complete, integrated management-control system for self-storage. For more information, call 800.331.6224; visit www.ptiaccess.com.