Analyzing Your Self-Storage Competition: How to Mine and Use This Valuable Information
In the MBA ethics course I once took, the professor asked, “Is it ethical to represent yourself as a potential customer to a competitor when doing competitive research?” The answer is yes, if you’re collecting information that’s publicly available and given freely to every prospective customer. While you shouldn’t go through a business’ trash, hack into its e-mail or engage in other shady behavior, you can call or visit and request information.
When you’re in the first stages of a feasibility analysis for a new self-storage project or exploring the market for an existing facility you want to acquire, it’s wise to call local competition and gather some hard data. If you already own a storage business, you should perform a competitive analysis at least every six months to better understand your position in the landscape and uncover areas where you might improve. In either case, you’re going to have to do some research, and then get out there and talk to competitors.
Regular competitive analysis can help you maximize facility profit. When you know what your competitors are doing, you won’t be left behind as customer needs and preferences change. Your units will stay full and you’ll be able to charge the highest possible rates. Following is advice on what to do and say to get the information you need.
Before You Call or Visit
You’ll want to be prepared. Start by Googling competitors and view their websites to answer as many initial questions as possible. You can also use the property-tax appraiser’s website, Google Earth, Maps and Live Search to gather information. Don’t forget about social media and popular review websites like Yelp. Track everything on an Excel spreadsheet or other document you can easily update.
Here are some questions you can likely answer before you even reach out to competitors. If not, you can cover them during your conversation.
What’s the facility’s exact location? Does the website contain a map and contact info?
What are the hours of operation? Is after-hours access available?
What kind of security does the facility use? Is there an alarm system? Surveillance cameras? An automatic gate?
Is the facility safe at night? Is it well-lit?
Does the operator sell locks, moving supplies or other items?
Is there an onsite manager, a self-service kiosk or both?
How many units are available and in what sizes? What sizes are most popular?
Is there a waiting list for unavailable sizes? If so, how long does it usually take for a unit to become available?
Are any of the units climate-controlled?
What are the unit prices? Are there any specials?
Can customers reserve or rent units online? What about online payments?
Time to Talk
Once you’ve completed this initial review, it’s time to start calling around or even visiting your self-storage competitors. To be successful, write a script and get comfortable with it. Learn and use it. Create your back story and get into character.
Start by saying something like, “Hi, my name is XX, and I’m interested in renting a storage unit for my parents.” This takes some pressure off the person on the other end of the phone to immediately close the sale, because shopping for storage on behalf of a third party usually means collecting a lot of information. He’ll expect you to ask questions and maybe even call back more than once before you decide.
It’s important to convey that you don’t know how much your parents will be storing and they may need to rent more than one unit. This’ll allow you to make more inquiries. Demonstrate that you’re interested in the business and how it operates. Remember, you’re a child concerned about his parents and their stored goods!
Once you’ve answered all the questions on the initial list above, here are a few others you might ask:
Have you ever experienced any break-ins or other crime?
Do your security cameras actually work? What areas do they capture? How long do you save the footage?
Have you had any issues with bugs or rodents? How do you prevent them?
Have there any been any leaks or flooding?
How often does the facility raise rent?
Is there anything else I need to know that makes your facility better than the others I’m contacting?
Finally, be prepared to provide a phone number and e-mail address if asked. You want to leave this information. Don’t you want to see if the operator uses it, how quickly he follows up and via which method? What does he say or offer?
Whenever I’m doing a competitive analysis, I examine each subject’s strengths, weaknesses, opportunities and threats (SWOT). As you’re researching, record if each competitor:
Answers the phone
Promptly responds to messages
Is friendly or rude
Requests your contact information
Follows up with you (and via which method)
Has a Facebook page or other social media presence
Is involved in the community
Has employees (how many?), is a “one-man show” or runs unmanned using technology
Has a clear slogan, value proposition, and brand or mission statement
Has something else that makes it unique in the marketplace
Once you’re done a SWOT analysis of each competitor, use it determine where your own operation’s weak spots are and how you can improve. Ask yourself:
What marketing specials are they offering that I don’t?
How do they make renting easier than I do, and how can I change?
Do they follow a professional sales script and ask for the rental?
Do they genuinely appear to want me as a customer? If so, do they say anything I need to add to my own sales presentation?
If you feel uncomfortable about conducting a competitive analysis, don’t. Being aware of what your competitors are doing is just smart business. They should be doing the same.
Coca-Cola and Pepsi watch each other’s every move, but they also follow an ethical code. Once, a Coke employee went to Pepsi with his employer’s secret recipe. Not only did Pepsi refuse it, the company helped the FBI catch the saboteur. As a self-storage operator, you’re simply conducting a competitive-intelligence analysis. Behave like an ethical person and treat your competitors as you’d want to be treated. It’s the quickest, easiest way to understand the conditions in your market. Best wishes for your success.
Katherine D’Agostino is the founder of Self-Storage Ninjas, a feasibility analysis firm. Katherine also offers a free weekly newsletter offering insider techniques, ready-to-use calculators, downloadable spreadsheets and data sources. For more information, visit www.selfstorageninjas.com.