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July 9, 2019
With occupancy rates of self storage facilities hovering around 90%, owners of self storage facilities are seeking ways to increase revenue.
Expanding into portable storage is an ideal option as it is a natural extension of a facility’s brand and purpose.
This article examines two different ways that self storage owners can incorporate portable storage into their existing facilities. This addition can fill up vacancies and set your facility apart with its meaningful option to those who would appreciate the convenience.
The quickest path to generating additional revenue is to use storage containers to expand the number of units on the facility—particularly if the facility experiences have high occupancy rates and low turnover.
Traditional construction can be expensive. Using storage containers as traditional rental units could be a far less costly option, especially if there is underutilized real estate on the property.
The containers function just like traditional units—with customers driving up to load or unload at the unit.
If space is confining, then the containers could be stacked in a wide array of configurations.
This flexibility allows you to add the type of unit that is best suited to customer needs. Better yet, you can expand at your own pace without having to commit to expensive construction.
Let’s look at the typical costs of building a new self storage facility.
A single-story storage building can cost from $25 to $40 per square foot while constructing a multi-story facility can range from $42 to $70 per square foot.
(Note: These prices don’t include labor or additional cost factors.)
By comparison, a storage container ranges in price from $2,500 to $4,500 (depending on the size and options). The average is approximately $18 to $22 per square foot.
Besides the lower cost, using storage containers to expand the number of rental units has other benefits, including:
Purchase units when and as needed. With traditional construction, you have to commit to architectural design, building, and labor.
Portable containers could be placed wherever there is space and be moved as needed. Containers can be placed on virtually any surface—concrete, asphalt, gravel, grass, or dirt.
If there is unused or underutilized space at your existing facility, using portable containers as rental units is a great way to start generating revenue on this unused space.
Also, storage containers can be placed in areas where construction is prohibited (such as easements)—allowing you to make the most of what is already there.
Storage containers require none of the red tape associated with construction.
A second option is to expand services by offering mobile portable storage—a natural extension of the brand as it is delivered to and from customers.
Containers generate brand perception to the public as consumers leave the containers out in the open during their rental.
With portable storage, the facility delivers the storage container to a customer’s site to load or unload. Once a container is full, then pick it up, deliver it to a new location, or leave it at the customer’s site for the duration of the rental agreement.
Not only does this mobile storage provide existing customers with a more convenient option if their needs are incredibly localized, but it also allows higher rental rates and additional fees for pick-up and delivery.
Other benefits of adding mobile storage to your facility include:
Offering portable storage extends self storage businesses to different types of customers beyond homeowners and companies requiring long term storage.
New types of customers might consist of construction companies (that need to store supplies on a job site) and restoration companies (that need to store supplies or a customer’s goods while performing their services).
Most self storage customers live within 3 to 5 miles of the facility. With mobile storage, you can expand your service area to a 30- to 100-mile radius depending on personal preferences and margins of operations.
By branding the storage containers with a facility’s logo and contact information, the containers act as mobile billboards for the physical facility and brand.
The number of containers can grow at the pace of available finances and personal comfort.
Whether the containers stay on the facility’s premises or only stored between rentals; open and repurposed space dictates the number of containers to fit on-site.
Of course, using storage containers for fixed or mobile storage has costs associated with it, including the purchase of the containers and a lift system and truck, but expansion comes with a price that, if planned well, pays off with new and return business.
(If you opt to go with portable storage, there may be a need for additional staff, such as a delivery driver, laborers, maintenance.)
However, these costs are still considerably less than new building construction and are more in line with recurring expenses like payroll that all businesses face.
Portable storage is a wonderfully exciting venture. Companies are already allowing for mobile portable containers to be their primary business model. Portable storage and its unique benefits are pleasing consumers and allowing owners, operators, and customers to enjoy self storage for the first time.
Existing facilities can use their experience and tested processes to incorporate portable storage through whichever method is most natural to implement on your facility site.
Both methods have advantages and disadvantages, but with your preference and an understanding, then whichever is the best fit for your future can be executed thoughtfully to begin increasing revenue and quality service.
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