One of the most massive, yet growing, industries out there is self-storage. Annual revenues have surpassed $32 billion. That number is only expected to rise as time goes on. The great thing about this type of company is that there are various ways to get started. You can start a budget operation with only a little bit of money or you can team up with major investment partners.
Another huge advantage to the storage business is that it is relatively passive – the work and expertise required is minimal. But you are going to want to learn the basic business skills that you need to know to start any business such as how to do effective marketing, set up your legal structure and get financing.
We’re going to look at the first option here as we walk through what this business takes to succeed.
Requirements Up Front
To open a boat storage or any other storage company, the first thing you need is a facility. You don’t just need any facility though. You need a facility in a location where there are plenty of potential renters who will pay enough for you to make a decent profit. Many people fail at this stage because of lack of research. Maybe they put their business in an area with too many other companies or maybe they found that the startup costs were too high. Don’t be these people. Do your research first.
Rates & Demand
If you have enough money to cover it, hiring a feasibility consultant is an excellent idea. You can also do this on your own. You’ll want to determine the market demands in areas that might work for you. Think about a couple of things: the average occupancy rate and the rate per square foot.
The Profit
Once you have those answers, you can start looking for the right building. You’ll have to consider conversion costs for each building on its own. Think about what your operating capital is, what your conversion costs will be, and how much space on the property won’t be leasable. You want to have a building in a high-traffic area with 90% occupancy or better.
Everything Else
If you’ve found the building you want, your next step is to get any needed permits and procure a business license. You can do this on the website for your secretary of state. You’ll also want the help of an attorney to determine what business entity will best fit your needs. Beyond that, you need to acquire a tax identification number. At that point you can open a bank account for the business and start applying for any financing you need.
Looking for a little more help? Lock ‘n’ Store is a trusted name in Australia and a great example of a successful storage business. They’ve built a strong company with multiple locations and storage sizes right for many different requirements.
