Choosing the right Management Company for your facility could be the most important decision you make when investing in self storage. Listed below are questions Owners should consider when shopping for a Management Company.
- How long has the management company been in business?
- The storage industry has experienced rapid growth in recent years and many new companies entered the 3rd Party Management business with little or no experience
- What is the company’s main business?
- Many management companies main business is not self storage management, but rather the brokerage business. Their objective is to manage your store, obtain the right to act as the exclusive listing Broker and receive the commission upon sale. Avoid management companies that are primarily Brokerage houses.
- The best management companies are those that own self storage facilities. This management company understands the issues surrounding ownership, and can help guide you through various issues that arise outside the daily operational scope.
- How large is the Organization?
- Most self storage management companies are small organizations that offer very little organizational depth.
- What type of disciplines should the management company have in-house? At least four disciplines are a must!
- Property Management Department: Avoid companies with only one senior executive in charge of operations. When you have a question you should have more than one source for an answer.
- Accounting Department: We recommend a department with several staff accountants reporting to a Certified Public Accountant. Timely, detailed and accurate financial reporting is critical to sound property management.
- Human Resource Department: It’s important to have an HR department to screen potential employees and ensure the store managers have a quality benefit compensation package. In the long run this reduces employee turnover.
- Information Technology Department: Today’s stores require sophisticated infrastructure to maximize internet marketing opportunities and lead management systems. The property management company should have a full-time, in-house computer technician supporting the stores' systems to minimize down-time.
- Construction Departments, Training Departments and Marketing Departments are helpful but not as critical.
- What is the District Manager to store ratio?
- Your store needs proper daily attention from the local District Manager. Depending on the District Manager's responsibilities, they should oversee no more than 10-12 stores
- Does the management company have a website targeting the consumer?
- A good website is critical to the success of your store. The management company should provide a website that drives rentals to your store and provides consumers with pricing and availability information.
- Does the management company have brand recognition?
- Most management companies don’t operate under a consistent branding scheme or trade name. This undermines their ability to leverage economies of scale for printed marketing materials, Internet advertising, and other media.
- A management company with consistent branding builds consumer recognition and drives rentals to your store.
- What is their management fee?
- Management fees typically are based on a percentage of a store's monthly total revenue; the percentage can range from 4%-8% depending on the scope of services.
- The fee should include: Interviewing and Hiring employees; Information Technology Help Desk; Monthly Financial Reporting; Website Placement; Training/Operating Manual; Daily Operational oversight.