The Keys To The Mini Storage Business

Self-storage centers, also commonly known as mini storage centers, are a hot industry. According to IBIS World, demand for self-storage is skyrocketing as rental vacancies fall. This is a common trend within the mini storage industry as self-storage units are traditionally utilized by renters who do not have the same amount of available storage space as homeowners. 

Since rental vacancies rarely remain high for long, self-storage is a highly resilient industry. Self-storage businesses also often do well during economic downturns as consumers downsize their living expenses and may need to find a way to store their valuables after moving into a smaller home or apartment. 

As with any business venture, moving into the self-storage industry requires a large amount of planning and research. This article is not intended to be an exhaustive guide to planning your self-storage business, but the key points here will provide you with a solid foundation to begin researching and constructing your business plan.

New Construction vs. Building Conversion

Although many mini storage business owners opt to construct new warehouses, conversion of existing buildings is an option as well. Traditional warehouses can be converted into self-storage centers, but this is the time to be creative and look for unusual opportunities such as unused retail locations. Converting existing structures comes with its own set of complexities, but it can save you up to 30% on your overall start-up costs.

When choosing a location for your self-storage warehouse, keep in mind the potential costs of renovating existing structures. Always consult with designers and contractors and do a thorough site inspection before becoming too attached to a prospect. Although there are serious cost savings to be had by converting existing buildings, structures that require too much work, are in a bad area, or that lack adequate parking for the local market may be more trouble than they are worth.

Understand the Local Market Conditions

Although it is tempting to look for markets where initial costs will be low, keep in mind that if costs are low for you, then they will be low for potential competitors as well. Investing large amounts into an area with a low barrier to entry exposes you to future competitors who will be able to learn from and potentially improve upon your business model.

Mini storage facilities are relatively common owing to the strength and profitability of this industry, so it is important to consider both existing and potential competitors. The market you choose should be relatively difficult for other businesses to enter and ideally, your plan should be uniquely suited to overcome these barriers.

Decide Early On Your Climate Control Policy

One of the largest decisions you will make when setting up a new mini storage center is whether or not some, most, or all of your units will be climate-controlled. Climate-controlled units will open a larger market of potential customers but will increase both start-up costs and overhead. Retrofitting non-climate-controlled units later on can be costly, so choosing how many units will be climate-controlled as part of your initial plan is important.

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