Recently, I’ve been working closely with several people who are either purchasing or developing automated self-storage facilities. Naturally, the conversation quickly turns to one thing: how are we going to manage them?
I am also reinventing how I will manage properties I am involved with, both through automation and with managers.
I will be the first to say that I don’t consider myself a management expert, although I have managed nearly 100 million square feet of self-storage facilities over my career. All, except for one facility, have been properties where I have had an ownership stake.
I’ll be honest: I have not been too impressed with the third-party management companies I have seen in the automated self-storage space. But to be fair, my exposure is somewhat limited. That said, I’ve always believed no one is going to care for my properties like I do. My success in self-storage ultimately falls on me, so I’ve made it my job—along with my team—to add value at every step. And that includes management.
That might not be the right approach for everyone. But it’s the one that works for me.
Because of that, I’ve had to learn at least a little about the art of self-storage management. And right now, that art is evolving fast. I don’t think there’s any part of our industry changing more rapidly than this one.
So, depending on when you’re reading this, know that my systems may have changed. But I wanted to get my current thinking down in an episode for those smaller investors who are either planning to develop or buy automated facilities—or are considering taking management back from a third-party company.
I’m helping clients in both situations right now.
Since I am not the smartest guy in the room, I like to start with something simple: an organizational structure. That helps me get my brain around what needs to happen. I almost always start here when thinking about companies I’m involved in. It keeps things focused and clear.
This is a simple organizational chart that covers the main functions (not people) that need to happen.
Your Management Companies Three Divisions
This assumes you’re managing your own facility. If you’re managing facilities for others, you’ll also need a fourth division for client communication, reporting, and relationship management.
But for your own operation, you need three main divisions:
- Customer Service
- Property-Level Operations
- Marketing (covered next week)
Let’s walk through the first two in this episode, and next week, we will cover the Marketing Division.
Customer Service
This is where you interact directly with customers—before and after the sale.
For me, the bar is set high. I want the customer experience at an automated facility to be just as good—or better—than what they’d get at a traditionally managed site. That’s the goal, and it drives how we build this division.
I’ve always liked managing my properties because I know someone wakes up every day thinking only about my assets. With third-party management, your facility is one of many—and usually, no one is focused solely on your success. I don’t like sharing bandwidth.
That’s why this division needs to be held accountable. For most smaller owners, especially those with one or two properties, that person will probably be you. Maybe later, you’ll hire someone or use a vendor, but to start with, it’s likely you.
This is where you set up your systems, define your key performance indicators, and choose your software stack.
I will share with you what we are doing right now. But again, remember this will most likely be altered or different depending on when you read or watch this.
We’re setting up our own call center instead of outsourcing. It’s a hybrid of AI chatbots and trained virtual assistants (VAs). Sounds high-tech—and it is—but it’s surprisingly accessible.
We hired a consultant who specializes in chatbot implementation. I’ve personally called some of the storage facilities using their bots, and I couldn’t tell I wasn’t talking to a person—until I asked something like, “Can I split payment between two cards?” Then the bot told me it was a chatbot and transferred me to a live VA.
We will be going this route on our facilities to keep costs down and give us more control.
Also, another advantage is our “call center” utilizes call management software, and we can set up measurements such as:
- Average seconds to answer
- Average abandonment rate for calls
- Average conversions to rent
This will inform us of any weaknesses and where to focus more effort with the VA(s) or how to modify the chatbots.
For online inquiries, we track first-time visitors, the units they viewed, whether they used the storage calculator, and more. We can build auto-email campaigns tailored to those behaviors. You’d be amazed at how many people reach the checkout and then drop off. Often, they’re just distracted. Automated follow-ups help turn those into move-ins.
The same applies to existing customers. Chatbots can handle about 90% of questions. Anything more complex gets referred immediately to a live VA. The system can also track things such as:
- Customer satisfaction
- First-call resolution rate
For maintenance, there is a web link to a form that creates a digital work order. If they call, it is texted to them. The assigned vendor or the boots-on-the-ground person updates the status, the customer is notified, and they can rate the outcome.
We set turnaround goals for certain tasks—like three days for basic maintenance—and track how we perform.
This not only improves service but creates a compelling value story when it comes time to sell. You can showcase your maintenance response times and customer satisfaction scores to potential buyers.
Again, for smaller operators, it’s all AI, VAs, and software—overseen by you or someone you appoint. In our case, we’ve got a consultant helping us optimize all this.
Ultimately, we still rate much of our customer service success by the number of new rentals that happen because of existing customer referrals. For our company, it has always been the second or third largest source of new leases. In our automated facilities, chatbots and VAs have baked in at various stages of customer interaction to ask for referrals. Links are sent automatically as well.
Property Level Management
As with the Customer Service Division, there needs to be a designated leader for the Property Level Management Division. Fortunately, with a construction company now, we have that person. However, for most smaller owners or operators, it will most likely be you or a partner.
For automated facilities, there needs to be a physical person most call “boots on the ground.” Usually, this is a 1099 “vendor” who has prescribed tasks to do, such as cleaning the facilities, preparing units where a move-out has happened, lock inspection reports, etc.
To stay in line with the IRS, we can define the scope of work to happen, how many times a week we want it to happen, and then they set when it happens. If you are telling them exactly when to be there, exactly what to do, and how many hours to work, they are most likely an employee. Don’t get sideways with the IRS over this. Also, if they are employees, they should get the benefits and safeguards employees are due.
The boots-on-the-ground person can handle simple maintenance issues in most cases. But for more complicated ones, such as door replacement, HVAC, and roof inspections twice a year, we use our Field Manager or a pre-determined vendor.
In the world of automated facility management, a maintenance vendor list is a must so people can respond promptly to maintenance issues because, remember, you are measuring your effectiveness as well as your customers. Set yourself up to win.
In our next episode, we will cover the Marketing Division of your management operations.
