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Lessons and insights from our favorite self storage experts. At the end of each year, we like to invite some of our favorite experts to share their lessons and insights from the year and what they're dreaming up for 2023.
Focus: Owners & Operators
Aired: December 8, 2022
If you don't have time to watch the whole session, here are some of our favorite parts:
We asked our experts: What's your favorite part of the storage industry?
Everyone is willing to help you. It's a wonderful sharing, caring, and giving community." - Nick Newcomb
"I get a front-seat view of watching generational wealth happen. Normal, everyday folks who have worked hard all their life." - Jane Sauls
"I'm seeing a lot of new, young people. They want to learn and they are so eager." - Stephanie Tharpe
"I just take great pleasure in watching my team thrive and being able to help grow them and mentor them." - Sue Haviland
"It's the real friendships that are going to stay after one of us leaves the industry." - Chad Lundberg
The storage industry had an amazing year in 2022, even if there may be signs of a looming recession that will require self storage owners to dust off their marketing playbooks and chase leads once more. While there are many aspects of your business that you can control, there are also many external forces that you cannot. Focus on aspects of your business that you can control: listening to your customers' wants and needs, improving your Google Business Profile, exploring new grassroots marketing tactics, and focusing on your business' data – to name a few. If you're struggling and don't know where to start or focus, then you're lucky to be a part of an incredible industry with excellent associations and great peers who are willing to talk to you and give you advice from their years of experience.
Gabfocus Sessions are virtual workshops for self storage owners, managers, and operators. Brought to you by the team behind Gabfest: StoragePug and Affordable Storage Guys Management.
Each session features hand-picked industry pros who will dive deep into relevant topics surrounding our industry, share best practices, and explore trends in the market. It's our hope that these sessions help you navigate your self storage business better during these uncertain times.
Want to learn more about self storage? Join us on select Thursdays for Gabfocus.
Our panelists will be happy to answer any questions you have. We hope you enjoyed this Gabfest Session. Talk soon!
“Once your operation is in place, you can become more dynamic with your pricing, but that requires data. You need some method of being able to record the data that you need to know whether your price is in the right place - whether you need to move it up or start giving some concessions.” - Warren Lieberman
“I never want to downplay to what someone else is doing. I'm better than they are, then I'm going to be worth a higher price. That's what value is. If you go out to a restaurant and get really good service, would you go back? Yes! What if it was pricier? You'd still go back because you got better service and a better product.” - Jim Mooney
"It's good to be informed on your competition. I don't want to ignore them, but I don't want to respond too strongly to them either." - Warren Lieberman
"We did a survey of 10,000 facilities on their pricing. We found out that two-thirds of those operators didn't change the price of a single unit of the course of a month." - Warren Lieberman
“Rate increases and value pricing are the number one ways to grow your revenue.” - Jim Mooney
"Tenants in more convenient units tend to be less price sensitive." - Warren Lieberman
"The size of the unit is only one aspect of what people are willing to pay for." - Warren Lieberman
Lease up marketing strategies:
Your average customer value
Find the average stay length of all tenants. Next take your economic occupancy and divide by how many units you have. That will tell you what the average customer pays.
Multiply the average length of stay by what the average customer pays, and that's the average value of a customer.
For example, if a customer stays for 12 months and pays $100 per month, then their value is $1,200.
Your average lead value
Figure out your closing rate (or conversion rate) i.e. how many leads do you turn into tenants? Multiply that by your average customer lifetime value to figure out what your leads are worth.
Pro Tip: see which lead sources are converting the best. It may be that certain sources have a higher conversion rate, so those leads are worth more to you than a source that barely converts.
Typical Lease-up timeline
According to our panelists, it's typical to see a 3-4% increase each month, putting your facility at 36% after the first year, and 72% after the second.
Alternately, you can look at your lease up goals through the lens of your units, aiming for 20 units rented per month.
For Nick and StorageMax, they pro forma their economic occupancy at 85% with their sweet spot at 92%.
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