Do it Yourself Competitive Analysis
What to say - and how to say it - to get the answers you need to analyze your competition for your self-storage business plan
In my MBA ethics course, the professor posed the question: is it ethical to represent yourself as a potential customer to a competitor when doing competitive research?
The answer is yes. My professor explained that it is ethical as long as you are collecting information that is publicly available and given freely to every prospective customer. So in other words, no going through the competitors’ trash, hacking into their email or being shady in any other way.
When you are in the first stages of your self-storage feasibility study for a new project or exploring the competitive landscape for a self-storage investment you are considering buying, you are going to need to call the competition and get some hard data. (And I’m sure if you already own a self-storage business, you are doing a competitive analysis at least every six months, riii-iiight?)
But I’m Already in Business, and Business is Good
Regular competitive analysis is one of the primary means to maximizing your profits for your self-storage investment. When you know what your competitors are doing you will not be left behind as customer needs and preferences change, your units will stay full and you will charge – and receive – the highest price possible for your competitive position.
Start with Google and use the competitor’s website to answer as many of your initial questions as possible. Use the property tax appraiser’s website, Google Earth, Google Maps and Live Search to measure and estimate the number of units. To download a free competitive analysis spreadsheet to use when doing an initial feasibility analysis, click here. To download a free competitive analysis spreadsheet to use if you already own a self-storage business, click here.
Pick Up the Phone
Get comfortable with the following script and use it to make sure you ask all your self-storage competitors the same questions and collect the data you need.
Hi, my name is ____________ and I am interested in renting a storage unit for my parents.
This is going to take off some of the pressure from the person answering the phone to close the sale. Because you are calling for your parents, you need to ask a lot of questions, and you need to check back with the competitor – maybe even more than once – before you can lease a unit. Get into character here and take a couple of minutes to think about your back story.
Be prepared with the phone number and e-mail you are going to give them. Absolutely leave your information if asked for it! Don’t you want to see if they use it or not, and what their prospect follow-up is?
If the competitor’s website addressed some of your questions below, add them to your spreadsheet.
· Is there a security or alarm system? Chances are, their website is not going to fully answer all of the questions you have about this, such as:
o Do the security cameras work?
o How long of a period do you keep the camera footage?
o Are the cameras on the gate only, or on the entire property?
· Is there an automatic gate so I can come in whenever I want?
· If I do come at night, will I be safe? How much lighting is there?
· Do you sell any moving supplies or locks, or do I need to bring my own?
· Is there a manager on site?
· Do you have any issues with bugs or rodents? How often do you spray?
· I’m not sure how much my parents will be storing, and they may want to get more than one unit. This is the information you need to know the most. The reason you ask so many questions leading up to this, is to get the person you are talking to in the habit of answering your questions, and to show how interested and curious you are.
o How many 5x5 units do you have left?
o How many 5x10 units do you have left?
o How many 10x10 units do you have left?
o How many 10x20 units do you have left?
o (Etcetera – you should know exactly the sizes they have from their website. If they have climate controlled and non-climate controlled, you need to ask how many of these are available.)
o What size units are the most popular?
o If you don’t have the unit size available I end up needing, do you have a waiting list?
o How long does it usually take for a unit to become available?
· Do you have any specials?
· How often do you raise prices?
· Is there anything else I need to know about what makes your facility better than the others I am contacting?
Boat & RV Questions to Ask
If you are considering boat and RV storage for your self-storage investment, additional questions to consider include:
· How do you charge for boat and RV storage – by the foot or by the stall?
· Do you have both indoor and outdoor storage, and how many spots do you have left of each?
· Is the outdoor storage open or enclosed? If it is enclosed, is it completely enclosed, enclosed on 3 sides or just the roof?
· What size units are the most popular?
· If you don’t have the size available I end up needing, do you have a waiting list?
· How long does it usually take for a unit to become available?
· Is it easy to park big vehicles in your spots?
· Do you have any amenities for boats and RV’s, like a washing, charging or dump station?
Two Birds, One Stone: SWOT Analysis
Whenever I’m doing a competitive analysis, I go ahead and do a SWOT analysis at the same time (Strengths/Weaknesses/Opportunities/Threats). As you are researching, record if each competitor:
· Actually answers their phone
· Calls you back promptly if you do leave a message
· Is friendly or rude
· Asks for any of your information
· Follows up with you via email or phone
· Has a Facebook page or any other social media presence
· Is involved in the community
· Runs the facility unmanned, manages it themselves or has employees and if so, how many
· Has a clear slogan, value proposition, brand and/or mission statement
· Rents units online, on the phone and/or from a kiosk
· As revelations hit you, or when you are done analyzing each competitor, note their strengths and weaknesses, opportunities you identify where you can be better, and threats that they are really good at that you need to overcome
When I am done with that analysis, I also note in the very last rows of my spreadsheet my takeaways, what is most unique about the competitor and brainstorm a few notes on how I can do better. For example, what marketing specials are they doing that I do not? How do they make renting easier than I do and how can I change? Do they follow a professional script and ask for the sale – do they genuinely appear to want me as a customer – and if so, do they say anything I need to add to my script?
Doing the Right Thing is Smart Business
If you feel at all odd doing a competitive analysis, you really shouldn’t. Making sure you are aware of what your potential competitors are doing is just smart business, and they should be doing the same thing to you when you open and regularly afterward.
Pepsi and Coca-Cola watch each other’s every move. Just remember the story of how one of Coke’s employees came to Pepsi with the secret recipe for Coke and not only would Pepsi not take it, they helped the FBI catch the saboteur.
You are an ethical person, conducting your competitive intelligence analysis the same way you would want it conducted by your competitor. Chances are, they probably won’t, but that doesn’t mean you shouldn’t! Best wishes to you for success with your self-storage business plan and new venture.