
Additions
Ancillary Services
n the increasingly competitive self-storage industry across the U.S., successful operators are discovering that diversifying with the use of ancillary services can significantly boost revenue and enhance customer experience.
Based on interviews with industry experts, this detailed overview explores how storage facilities are diversifying their offerings beyond traditional storage units and creating additional revenue streams all while meeting evolving customer needs.
Al Gardes, director of operations at Elmwood Self Storage, explains how thorough local market analysis can lead to unique opportunities. “Being in New Orleans, a party town known for food and drink, we recognized there was no professional wine cellar in the city,” he says. “That insight led us to include an elaborate wine cellar from the beginning, which has been wildly successful.” The wine cellar proved so popular that they expanded it after 10 years, showing how well-chosen ancillary services can grow over time.
Traditionally, storage facilities provided the core service of renting out space for personal and business belongings. However, over time, many have diversified their offerings by introducing ancillary services—those additional services that complement the primary storage function.
Ensure Adequate Staff Training
Implementing ancillary services often requires additional staff or a shift in roles. As Gibson notes, “You don’t know when you first sign up for something how busy it’s going to be.” Some sites may need to hire part-time employees for specific services like truck rentals, while others may find that their existing staff can absorb the extra workload. Balancing additional services with the core function of managing storage units is crucial to avoid overburdening employees.
Maintain Clear Pricing Structures
Transparent and competitive pricing is critical to customer satisfaction. Operators should ensure that the costs for additional services are clearly communicated, with no hidden fees. “Always put an actual price on it,” says Mixon. “Sometimes they just put it above and then the customers don’t always see it, or they put it somewhere close, and you can’t tell which one, which price goes with what, and they don’t like to ask. So, it’s much better to make sure you’re merchandising really well.” This builds trust and allows customers to make informed decisions.
Monitor Space Utilization
Facilities need to carefully assess whether they have the available space to incorporate ancillary services without interfering with their core business. Ray McRae, another industry expert, says, “If space is an issue, and the sideline will interfere with the base storage business, then it may not be right for that location.”
This consideration can extend to parts of a facility, such as parking availability for truck rentals, office space for retail displays, overall facility layout and traffic flow, and storage unit optimization.
Regular Service Evaluation
Regular evaluation ensures that services remain relevant and effective. Gibson says to ask yourself, “Did that really make sense at that point? Was it something good for the business? Did it bring us any additional business, or was it just a service that we were performing, and we were basically breaking even?” By tracking performance over time, operators can decide whether to continue, adjust, or discontinue certain services based on their impact.
Wine connoisseurs benefit from these specialized units, and some facilities take it a step further by offering tasting areas where customers can enjoy their collections in an upscale environment. “We do a lot of personal marketing, visiting all the wine shops in town to constantly remind them what we offer and how it can be a win-win for their high-end customers,” says Gardes.
As security concerns are also top of mind for customers, many storage facilities are enhancing their offerings with advanced security services. For instance, some now provide safe deposit boxes with 24/7 access, giving clients a secure space to store valuables such as important documents, jewelry, or heirlooms.
Regional Needs
Gardes also notes to pay attention to the local area to identify the specific needs of the residents. “Tulane University, our biggest university here, has a massive, multi-billion-dollar art collection. And so, their building on campus had gotten badly damaged in Katrina. They had to move the art, the sculpture, everything out as soon as possible,” he says. “When they did their research, they found we were the only ones that had a reputation for being able to handle high-end goods. So, they moved their entire collection here and they stayed with us for multiple years until that building was redone again, but it led us to then having other museums store with us.” This fostered a creative competitive advantage for the overall facility as a result.
Mixon describes her experience local to Hawaii. “We added surfboard storage racks across from a popular beach. The first rack of 12 spots filled immediately, so we added 24 more, which also rented quickly.”
She also notes the positive impact of understanding different cultural habits. “In Hawaii and Asia, customers utilize vertical space much more efficiently than in mainland U.S., affecting how we approach box sales and storage solutions.”
Additionally, they host events or partner with local businesses to engage with the community, as seen with Gardes’ charity events for organizations like Children’s Hospital. “We pay for these things to get people to come in, planting the seed for future reference. We’ve gotten a lot of business from these high-end social events.”
If there are gaps within the operational sector, such as costs, impact on core storage business, staff time allocation, customer satisfaction, space utilization efficiency, and marketing positioning, then they should be analyzed before choosing to shut down a service all together.
“Propane was one of them where it was costing us more for propane and the repairs of the propane tank versus what we were selling,” says Gibson. “And so we were upside down. We were losing money. For the training, for the upkeep, for all the things that it required us to do in order to be able to offer that didn’t make sense anymore because we were spending money to offer that.”
One of the most significant trends in the self-storage industry is the integration of advanced technology to improve both the operational efficiency of storage facilities and create a positive experience for customers.
Digital Security Solutions
More storage facilities are offering digital security features that go beyond traditional locks and keys. Individual units are equipped with smart locks that can be controlled via mobile apps or keypads.
McRae notes that they can also be outsourced. “For a long time, there was no coverage for vehicles being stored. Now there are some products out there that are similar to property protection for storage units that will pay an administration fee to operators for selling their product.” These systems provide tenants with greater control over access, and some even offer real-time notifications when someone enters or exits their unit. This tech-savvy approach appeals to customers who are concerned about the safety of their belongings.
Mobile Apps For Service Access
Mobile apps are becoming a standard feature for many self-storage facilities. These apps enable customers to manage their accounts, pay bills, and access their storage units remotely. This convenience not only enhances the customer experience but also streamlines the day-to-day operations of the facility.
Automated Payment Systems
The rise of automated payment systems allows tenants to pay their bills online or through automated kiosks at the facility. This contactless payment option is ideal for customers who prefer to manage their accounts digitally, offering greater flexibility in payment methods and reducing the risk of late fees.
Remote Monitoring Capabilities
With increasing demand for real-time security, many storage facilities are incorporating remote monitoring features. These systems allow facility managers to monitor security cameras and other surveillance equipment from a distance, ensuring that the premises remain secure at all times. Facility managers can respond to incidents quickly without needing to be physically on site.
Conference Room Rentals
As remote work continues to rise, and small businesses look for flexible office solutions, some storage facilities are now offering conference room rentals. “They put a conference room in, and they don’t really use it, so they were advertising that small conference area, and you could get it weekly or a few days at an individual day rate,” says Mixon. “So they had some of their customers that were in the units that were using it, but also new customers that weren’t renting previously.”
Vehicle Upkeep Plans
As more customers use storage facilities for their vehicles, there is a growing demand for additional services such as vehicle protection plans. These plans might include maintenance services, such as oil changes and tire rotations, or protection against weather-related damage. Offering such services makes sense for storage facilities that store high-value cars, RVs, or boats, as customers often seek ways to protect their vehicles while they are in storage.
Specialized Storage For High-Value Items
As the market for high-value goods grows, specialized storage options have emerged. These include storage units designed to accommodate items like art, antiques, or luxury goods, offering enhanced security, climate control, and even inventory management services. This trend speaks to the increasing demand for secure, customized storage solutions for valuable and fragile items.
The future of ancillary services in self-storage will likely continue to evolve with changing consumer needs and technological advancement. Successful operators will continue to be those who can identify and implement new services while maintaining operational efficiency and customer satisfaction. As the industry continues to mature, the role of ancillary services in driving revenue and customer retention will only become more significant.