Finances. They make a lot of people go cross-eyed, and yet they're the lifeblood of any business. Without proper financial management, you can easily find yourself digging your business into a hole. See what our expert panelists have to say about keeping track of and even improving your self storage business's finances.

Featured Speakers: Magen Smith & Alex Erbs
Moderators: Tommy Nguyen & Melissa Huff

Category: Finances
Focus: Owners & Operators
Aired: June 23, 2022
Duration: 1:14:21

Overview

If you don't have time to watch the whole Session, here are some of our favorite parts:

• At 4:45, our panelists discuss the most important metrics to monitor at your self storage facility, including economic occupancy, revenue per square foot, and closing rates.
• At 7:55, Magen and Alex tell us how often they view their reports. Hint: It's daily, but there's more.
• At 11:00, Alex urges owners to look at their data. He tells us that this data is what drives and informs our businesses.
• At 13:20, Tommy tells us something he heard from Alyssa Quill of Storage Asset Management: It's about identifying the outliers. You won't know what's an outlier if you're not consistently looking at the data.
• At 14:30, our guests discuss tracking and evaluating expenses and spending.
• At 19:15, they answer a viewer's question about specific revenue management techniques.
• At 22:50, panelists talk about the major expenses at self storage facilities. Then, at 26:00, they reveal the typical surprise expenses that catch owners off-guard.
• At 31:10, Magen and Alex explain how they measure the health and profitability of a self storage business. Magen explains that, ultimately, it's cash collected.
• At 42:15, our panelists explore growth opportunities, how to recognize them, and the idea that there is more to growth than physical expansion.
• At 46:30, we get some great tips on raising rates and dealing with the backlash!
• At 50:25, Magen and Alex give their advice on how to be prepared for a recession.
• At 54:25, we hear about how a coming recession might impact self storage.
• At 1:01:00, we enter our lightning round of questions including how to handle accounting, common accounting mistakes, and preparing for tax season.
• At 1:06:10, our experts answer the Question of the Week!

Resources

• 2022 Self Storage Almanac

Question of the Week

We asked our experts: What are the biggest blindspots operators have when evaluating their finances?

"Thinking that net income on the P&L equals cash in the bank, especially if you have a mortgage. There are depreciation expenses that reduce income, and there’s principle on loan payments that reduce cash but not income. So just understand that income on your income statement is not cash in the bank." - Magen Smith

"Making sure you understand your income versus your expense versus what you’re actually paying for debt service versus what you’re paying for all these different things, here." - Alex Erbs

Gabfocus Takeaway

You need to keep a good read on your operations so that you can optimize your finances. If you're an owner that manages your own property, this might mean taking a step back and looking at your finances from a new perspective once in a while. If you have managers, it might mean keeping track of their opinions on the state of the facility and customer demand. It also means pulling up your financial data and understanding it, even if you have to ask for help. And if there's one final thing to keep in mind, it's to always have a reserve of cash on hand for the unexpected.

What are Gabfocus Sessions?

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.