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Posted almost 6 years ago

Self Storage: Shopping Competition

Shopping your competition is essential to keeping your facility competitive. Not just for tracking rental rates, but the overall customer experience and amenities you may not be providing. Regardless of your business model, knowing how your competition performs at every task is essential to help differentiate your facility from the rest.

As a manager I had to rate shop the competition often and learned quite a few things while doing so. Here are some tips I picked up along the way.

Why Shop

1.Rates: The most common reason is to know the rates your competitors are charging for similar units so you can properly set the right prices.

2.Sales Presentation: Arguably the most important reason to shop your competition (in my opinion). Do they have a great sales presentation? How does your presentation compare? Is there room for improvement? Did they ask for the sale? etc… A great sales presentation will make or break the customer experience, which ultimately will make or break the success of your facility. If your competition lacks a decent sales presentation, then you know you can get ahead of the competition by simply having a well-rounded sales presentation.

3.Amenities Offered: Do they have truck rentals, climate control, tenant insurance, security features, hours, moving supplies, moving carts, etc..? What are they offering that your facility isn’t? If you aren’t offering a certain amenity and every facility in your are is, should you start providing that?

4.Concessions: What discounts are your competition running to gain new customers? If you are missing more and more sales, maybe this is due to local competition running different discounts.

5.Occupancy: How many units do they have left of different sizes? This might not be very accurate due to the fact that people tend to say, “we only have one left”, to get the sale. You can even check overall occupancy by renting a unit and scoping things out.

6.Due diligence: Shop the competition in a target market to learn market-specific trends. Once you find a facility you should visit every facility in the area, including the target facility (without the owners/managers knowing), to get a good gauge on where things are at and where they need to be improved.

How To Shop

1.Call: Act as a new customer looking for storage. Write some scripts down to make it easy. Ask open-ended questions as if you have no clue how the process works. This way the manager runs through the whole presentation and you get more information.

2.Visit: Again, act as a new customer looking for storage. Walk the facility and take as many notes as you can about the facility. This usually only works once or twice, as the managers will catch on quickly. I would suggest doing this during the due diligence stage to really walk and understand each facility in your area.

3.Internet: The beautiful thing about the internet is that some of this information is online. However, the information may not be up to date. Sometimes the website price is different on purpose. Cross-reference every call with a website check to see if they are running lower rates online. Take note of their web presence and what their website offers such as online payments or move-ins.

4.Hire someone: Have someone, whether it’s a family, friend, or 3rd party, call and visit the facility and run through the exact same steps that you would. Make a form for them to fill out so you can review the information when you need to. This will not only free up time, but also avoid having the site managers catch on to the same person calling/visiting.

5.Rent a unit: This will allow you to run through the entire process from start to finish. As previously mentioned, you will be able to walk the facility and really take notes. Check locks to get a rough occupancy percentage. Go late one month and see their past dues process.

When to shop

The most common interval is monthly. Compile the data each month and review to make adjustments. Every quarter you should go in depth with the data to spot trends. This is a good way to track the health of your competition. The last thing you want to do is have a death-spiral of lowering rates back and forth. Visiting facilities once a year is also suggested to see what is new and what is changing in your market.

Miscellaneous

I would suggest creating scripts for both phone calls and site visits. Change them often so the site managers don’t catch on. Keep it simple and ask basic questions. Avoid using industry specific language.

Most management software will have a “rate or competition tracker” that makes entering this data easy. Making one yourself is not hard if your software lacks that capability. Just input everything into excel; rates, amenities, concessions, facility address, dates, unit sizes, etc.

Hope this helps. Shopping your competition is one of the best ways to keep up with your mark-specific trends.



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