By Fred Grauer

In Southern California, as May drew to a close, residents prepared for June Gloom, a time of the year when much of the state prefers to hibernate rather than go outside to wash cars and have fun. People are down in the dumps, the sky is falling and, in general, malaise prevails throughout the land.

Being a frequent visitor to the state, with four of five children as well as several friends and customers living there, I had to wonder about this phenomenon, not out of morbid curiosity but real concern. I have since learned that June Gloom occurs when the ground warms, yet the ocean remains cold. The results of this convergence are gray, overcast skies, uncertain weather and unpredictable sailing conditions. Are we talking about climatic circumstances or the economy? In either case, it doesnt sound like a good time to be venturing into uncharted waters or washing cars.

A Greater Incident

Is June Gloom strictly a weather-driven, regional condition, or is it a general dissatisfaction being experienced by the entire country? Normally, to answer such deep, philosophical questions, I consult my Ouija board. So I did. But not having arrived at any palatable, sensible answers, I decided to seek out the facts.

It didnt take long to confirm the South and Southeast has had rain; the West is going through a drought; employment is up; durable-goods orders are going up; interest rates are still the lowest they have been in years; petroleum margins have improved; net profits in most industries are better; and, most important, the International Carwash Association celebrated its 50th anniversary and had its best annual convention ever. Most car-wash operators volumes and profits are up. So whats the deal?

There is no doubt that, globally speaking, America is not the worlds favorite son. Its easy to blame our poll numbers, which are in the basement, for the countrys unrest. But lets face it: When you are successful in your business, personal or political life, someone is going to dislike you. We still know the weather is plus or minus a degree over last year, and our economy is rebounding nicely; so what is the real cause of our dejection?

I think its the story of Chicken Little all over again. Even though the forecast indicates sun, we have elected to become defensive rather than proactive in all areas of our lives, business included. But unlike the weather, over which we have no control, our economic and political woes are things we can counteract. For those of us who have weathered every storm imaginable, June Gloom is actually an opportunity.

One autumn, years ago, I faced a particularly challenging season. My car washes had suffered from 26 weekends of rain, and I was ready to cut my throat. I called a dear friend and great car-wash colleague, Fred Frattaroli. Freddy and I were commiserating, and he made a statement to me Ive never forgotten: In every seed of adversity, there is a seed of equal or greater opportunity.

Whats the point of all this rhetoric? Its a message to those currently suffering from the gloom: Get real! This is a time of action. Its a great time to start a new businesswhy not a car-wash business, in conjunction with selfstorage or separately? Our government, the same one that brought you freedom of speech and choice, also offers some pretty tremendous tax incentives. But the time on its deal is running short; so be proactive, put a smile on your face as well as your wallet, and invest. Your Chicken Little counterparts will be cogitating, and youll be enjoying a more efficient, profitable business.

Fred Grauer is the vice president, distributor network, for MarkVII Equipment LLC, a car-wash equipment manufacturer in Arvada, Colo. He has made a lifelong career of designing, selling, building and operating car washes. He can be reached at [email protected].

The Florida Self Storage Association

The best start under the sun

By Kimberly Hundley

Though some might like to believe it, creating a strong state self-storage association is not as simple as mixing up a delicious pitcher of Florida orange juice. Self-storage advocates who have been there and done that know it is more like cultivating an entire orange grove.

Since its energetic inception in 1998, the Florida Self Storage Association (FSSA) has grown from a regional networking group to a vibrant statewide organization. Thanks to some inventive, members-only offerings, it has increased membership 25 percent in the last year to a total of 400. Determination and creativity on the part of board trustees has steered the association through a period of dormancy to a new era. In November, the FSSA will host its first regional conference and tradeshow, in conjunction with Inside Self-Storage (ISS).

An Auspicious Beginning

David Blum, past president and current board trustee, recalls the ups and downs of the associations first years. We started as the South Florida Self-Storage Association, which was basically designed to be a group for networking among owners and operators in the tri-county area of south Florida, Blum says. We received a tremendous amount of support and interest initially. In August 2000, we had our first mixer. It was like a tradeshow, and we invited everybody managers, employees and operators. We had about 20 vendors with table-top displays, and it was a rousing success, with almost 300 attendees.

Around the same time, Michael Kidd, executive director of the national Self Storage Association, approached the groups board members and encouraged them to build on their momentum and launch a statewide organization. The board gladly took up the challenge. Before long, however, an ongoing battle surfaced: how to remain relevant to members.

I think all the state associations are running into this issue, Blum says. There is a lot of enthusiasm in the early days; but in time, everybody starts to look for what the association provides its membership. Without a continuing source of income from either fundraisers or dues, its difficult to provide services to the members. After about two years, you run into a struggle to justify their continued support.

Goals and Challenges

A recognized role of state associations is to provide a united front in lobbying for the industry. All the major national self-storage companies account for less than 10 percent of total facilities, Blum says. Thats why its important for individual operators to have a group that represents their interests throughout the state. When issues do arise, most legislators want a single voice representing the industry. And they want a local, not national, organization representing them.

In Florida, however, no rallying point such as late-fee legislation has emerged to drive statewide membership. The FSSA positions itself as a proactive organization working to educate lawmakers on industry needs, yet such results arent concrete. Members and potential subscribers want to see cold, hard, tangible benefits for their $250 in annual dues.

What to do? The FSSA board committed to producing more discounts and other members- only amenities. A self-storage lease, developed in August 2003, perhaps ranks as the most valuable. Approved for use in the state of Florida, the lease is available for purchase on CD. Not many state associations have a specific state-sponsored lease, well-written by a highly regarded self-storage attorney, says Linnea Appleby, board president. Thats a huge benefit, available only to members.

The association recently revamped its website, www.floridassa.org, and is creating an area exclusively for members where jobs may be posted. Well also have a bulletin board for exchanging questions and answers on issues that come up in the state, Blum says. With the help of the national association, we have an advocacy network people can call when issues arise, and we limit that to members. Quarterly networking luncheons at which discounts are offered are offered for members as well.

Blum is pleased with the boards progress thus far. Weve worked very diligently over the last year and a half to create benefits to promote and drive membership, he says. But the FSSA still has ample room to grow. The state of Florida has 2,300 self-storage facilities, according to Blum. The potential to expand is enormous, and growth is a key goal for the board.

We want to be able to reach out, Blum says. Right now we are very strong in the south and west. We want to expand into the central, northeast and southeast parts of the state. One of our strongest goals is to find people to help us support that growth. To encourage expansion, Blum and other key board members continually seek like-minded candidates who sincerely care about the industrys well-being.

What were looking for are people who have a genuine interest in the concept of an association supporting the industry in the state, says Blum. And were starting to get more people who have an interest in the betterment of the industry and the importance of having a single voice that offers real benefits for the members.

Board of trustee members serve three-year terms. Blum and Appleby are excited by the boards direction and recent retooling. Specific committees are being formed to tackle topics such as education and special events, with each committee headed by a board member.

Expo Tops the List

In reviewing the FSSAs accomplishments for 2004, Blum points to the joint-venture expo in Miami, Nov. 17-19, as a milestone. By teaming with ISS in a regional event, the FSSA will help alleviate the drain on vendors who cant afford to attend the burgeoning number of tradeshows. I think in the future youll see more and more of this type of thing start to come on, says Blum.

The conference kicks off with a one-day developers seminar sponsored solely by the FSSA on Nov. 16. Weve done it each year, and each year it gets progressively more popular, Blum says. The seminar is ideal for anyone interested in storage development. A separate fee is required.

In addition, the FSSA planned one of the expos educational tracks, devoted entirely to state-specific issues. The track features experts on building codes, insurance, human resources and Internet marketing. Next year, Blum predicts, the content will be regionalized to attract attendees from Georgia and other nearby states. Also featured this year is a track geared toward industry newcomers and another for seasoned professionals in the business.

The ISS expo is designed to assist those involved in self-storage as well as those investigating opportunities to excel in the industry, says Michael Reed, ISS tradeshow manager. Our joint effort with the FSSA is a continuation of our efforts to promote the self-storage industry. We continually increase awareness and provide networking opportunities for developers, owners, operators and suppliers from many parts of the globe.

Reed, Blum and Appleby say the choice of Miami as host city will definitely add to the shows appeal. This is the first time an event has been held in Miami, and its going to be extremely exciting, Blum says. Its also the first time a state association has joined up with a professional like ISS to put together a joint venture. Its going to be informative, fun and one of the best shows around.

For more information, visit www.insideselfstorage.com/expo/miami.

---

FLORIDA SELF STORAGE ASSOCIATION
Board of Trustees

Linnea Appleby, President
Storage Spot
Bradenton, Fla.
www.storagespot.com

Jeanne Braker, Executive Director
Florida Self Storage Association
Boca Raton, Fla.

David Blum
Blum Management Services
Coral Springs, Fla.
www.blumms.com

Brian Blankenship
Metro Storage
Lake Bluff, Ill.
www.metrostorage.com

Chip Cordes
U.S. Door & Building Components
Orlando, Fla.
www.usdoor.com

Kerry K. Harvey
Florida Secure Self Storage
Penbrook Pines, Fla.
www.floridasecurestorage.com

L. Bruce McCardle
Mako Steel Inc.
Jacksonville, Fla.
www.makosteel.com

Lew Pollack
Stars & Stripes
Boca Raton, Fla.

Norman Schulman
Sentry Self Storage
Coral Springs, Fla.
www.sentry-selfstorage.com

Heather Toler
Capital Management & Realty
Boynton Beach, Fla.

By Victor Lopez

You have probably seen those infomercials selling the best of the '70s and '80s music collection. If you pause to listen to some of the hits being advertised, its probably because you have a fond memory associated with one of the songs. The same kind of association occurs with the great self-storage hits of decades past. There can so many fond memories of hitting a homerun with a storage site, whether because of how quickly it came together or how fast it filled up.

Compared to todays standards, many of those greatest hits of storage included every mistake in the book and still were a success. Memories indeed, as developing a storage facility now requires more effort and resources than ever before to get through the approval phases, battle the rising cost of construction, and navigate the flood of competition. Every step in the development process must be carefully planned and evaluated. This is certainly true when designing your site layout and assembling your unit mix.

Site Layout

This is the first step and requires a great deal of information about zoning regulations, setbacks and other jurisdictional requirements. This is where you want to have an experienced design-builder or very good civil engineer with self-storage experience to get through the process. I always prefer to use a local engineer familiar with all the current zoning regulations and all the routines and people in the planning department. This will save you weeks in getting your site plan approved.

While hacking out your plan, some of the most important considerations are land cost, land coverage, site improvements and building layout. The key is to understand these variables and what they cost to maximize the coverage on your site.

Land cost and land coverage can go hand in hand. What you pay for the dirt and how much gross square footage of building you squeeze out of it affect the overall financial performance of the facility. But it goes beyond just how much you pay for the site, because you always need to consider what you will be able to build and what it is going to take to get there.

The first hurdle in maximizing your coverage is determining the setbacks and required buffers for your site. Examining the plat and verifying additional requirements with the city easily determine these. It doesnt stop there, however. More often, the fire marshal and arborist are stealing valuable space and decreasing your coverage. Be sure to check what is required for fire-lane widths and turning radius for your local fire department. Also determine the required landscape areas and buffers. Sometimes these are disguised by calling them pervious cover areas or green space.

Once you have determined the physical parameters of your site, consider what site improvements are obstacles to maximizing coverage. Earlier in your development process, you should have determined which utilities you have or, at least, how far you have to go to get them. Dont cut yourself short by not using existing utility locations to your best advantage. Again, you will need to satisfy the fire marshal by installing the required number of fire hydrants and associated fire lines. Find out the exact requirements for the line sizes, if a check valve is needed, and if the fire lines need to be looped or if they can be dead-end. Looping a fire line can double your cost!

Another site-improvement consideration is excavation and grading. Will the site require a lot of dirt to be moved, or can you lay out the buildings to follow the natural grade? You might consider using split-level buildings to take advantage of steep grades on the site. Retaining walls can also help capture more useable space on a site with steep grades, but use them as a last result due to the significant cost of some of them.

Finally, storm drainage is a significant factor. Use surface drainage as much as possible to keep costs down, and make sure your civil engineer has carefully determined the requirements for storm-water detention and filtration. Detention ponds can take up valuable space and reduce your coverage. They can also add significant cost if you use concrete ponds or underground detention. Water-quality or filtration ponds will also become costly if not carefully placed and properly sized.

Now that you have figured out how much of the site you can use while making the fire marshal and the arborist happy and spending as little as possible, you can start laying out the buildings. This is where the site plan begins to take shape and overlaps the unit-mix plan. This happens because you know certain width buildings will yield a certain combination of unit sizes. Dont make all your buildings the same width just because a manufacture has a clearance sale on metal buildings. Likewise, dont get yourself in a jam by lining all the property lines with single-loading buildings of the same width. The objective is to maximize the financial performance of your facility and achieve the right unit mix.

Unit Mix

Designing a unit mix can be one of the most elusive tasks in the development process, especially for the first-time developer. All too often, the newcomer to the industry is looking for the instant unit-mix packagejust add buildings and doors and start leasing. Unfortunately, there is no quick answer for the eager entrepreneur, and some resort to buying up the standard building package with the unit mix that works best for the installer.

However, there is a methodical approach that makes use of all of the information gathered during a proper market study. Designing your unit mix is best accomplished by taking a baseline mix and tailoring it to fit your specific site according to market conditions and demographics.

There are few ways to determine a baseline unit mix. Any good property-management company keeps a database of operating information from all of its stores and thoroughly analyzes it to arrive at a unit mix that works for a given set of market conditions. This is the baseline mix. Without the benefit of these statistics, however, a first-time developer can go to state or national industry associations to see what information is available.

The data is usually compiled from many facilities throughout a given region and, in some cases, it is difficult to integrate operating statistics with a specific set of market conditions. As a last resort, you can collect field information from existing facilities in similar markets and compile your own baseline mix. The important thing is to have a starting point, relative to a certain market type, expressed in terms of average unit size. Understand, however, the vast majority of units are smaller, not larger, than average size.

Making Adjustments

The next step is to examine your target market and build your unit mix by adjusting the baseline according to existing competition and the different elements in your trade area. For example, the ratio of commercial to residential composition will affect your mix. A typical market will have 75 percent residential tenants and 25 percent commercial.

If there is a larger commercial presence in your market, increase the average unit size. Keep in mind that more commercial activity doesnt increase the net demand in your market; it just means you will need more large units. Similarly, if your market has a big medical- or professional-office presence, you will need to increase the average unit size of your climate-controlled units. Doctors and lawyers rent these units to store records.

During your market study, you should have identified the location, size, rental rates, occupancy and other details of your competitors. Use this information to adjust the average unit size to account for shortfalls in your market. For example, if theres not a single available 10-by-20 standard or 10-by-15 climate-controlled unit anywhere near your site, put those in your mix. On the other hand, if no one across the market is renting a certain size unit at all, stay away from it.

The Role of Demographics

Further adjustments to the average unit size will come from your demographic report. The most significant component of this report is owner vs. renter housing. People who own their own homes will rent larger units and usually keep them longer. Those renting apartments move around more often and have less stuff; therefore, they will rent a smaller unit for a shorter time. Adjust your mix to include more of the smaller units if your market has a higher percentage of renters than your baseline market. Conversely, if your market has a higher percentage of homeowners, adjust your mix to include more of the larger units.

Age, income and marital status of your tenants will affect your unit mix as well. A single male between 18 and 25 will typically rent a smaller unit, while a married person with three kids will rent a larger one. If your target market has a lot of young, single people, adjust your average unit size accordinglyyou will need more small units. Those in higher income brackets will rent more climate-control units. Again, it is important to remember these demographic factors do not necessarily increase the net demand, but will affect the sizes of units that are requested more frequently.

A final note: Just as there is no magic formula for unit mix, there is no way to design a guaranteed mix. The steps outlined above are derived from years of trial and error as well as consistent information-gathering and analysis. Just as you should involve a civil engineer or experienced self-storage design-builder in the site-planning process, you will do well to hire a consultant or involve an experienced property manager to help design your first unit mix.

A good way of having some insurance for your unit mix is to phase in your facility. Building in phases allows you to adjust your mix based on the demand you experience during operation of the initial phase. Also remember to select a building design that allows flexibility in case you need to move partition walls to adjust unit sizes.

The Whole Enchilada

Until this point, neither your site plan nor your unit mix should be finalized, because as you begin filling each building footprint with the sizes and quantities to match your unit mix, you will find you need to adjust the building shapes to get the best fit. Likewise, you may have to adjust your unit mix to accommodate the buildings on the site plan. Further adjustments to the plan will probably come as you go through the approval process with your local jurisdiction.

As you roll with the punches throughout this process, make sure to monitor how changes affect ratios for coverage and site improvements as well as the averages for unit size and rental income. Because you have designed your facility with the most economical improvement costs and tailored your unit mix, the end result will be an approved site plan with the best potential income stream that will maximize your return on investment. And thats a greatest hit!

Victor Lopez is president of NDS Construction, a design-build company that has specialized in self-storage and metal-building systems for more than 18 years. For more information, call 210.477.1227; e-mail [email protected]; visit www.ndsconstruction.cc.

...

By Tron Jordheim

I like to play a game whenever I travel to a seminar or conference. I open the local Yellow Pages and call every storage facility with a display ad, from the biggest to the smallest. When someone answers, I try one of my two acid tests to see what response I get.

The first test is The Information Question, where I ask, How late are you open today? You would not believe how many people only tell me the store hours and let me off the phone without even asking why I need to know. If I were a current tenant, they should want to know if I need assistance when I get to the office. If I were someone on the collections list, they should want to confirm I know the correct amount to pay my bill. And if I were a rental inquiry, they should want to give me more information than the office hours! As a prospect, I want to talk to someone who will actually help me determine my storage needs and sell me a unit.

There are other questions that work well for this experiment, such as: Do you sell boxes? Do you rent trucks? Do I need a lock to store with you? You may think I am joking about this, but so far, about seven out 10 people fail the test. You can increase the number of rentals at your store by simply making sure everyone who calls you either already rents from you or knows why he should.

It Is Useless to Resist Us

The other acid test is The Weak Resistance Test. In this version, when the person answers the phone, I simply inquire about storage. I am not looking for good sales technique, only waiting for the person to provide the price of a unit. When he finally does, I tentatively say, Oh, thats a little more than Im looking to spend. Surprisingly, few people have a suitable response to this statement. They usually give up, saying something along the lines of, OK, thanks for calling. Come and visit us if youd like. Good-bye.

Again, seven out of 10 of my test subjects fail to ask for more information. They dont even know if the price is $1 or $100 more than I can afford. In my experience, a $10 difference in price between two storage facilities is not a deal-breaker if the more expensive property provides real value or is more conveniently located. The trick is the opportunity to build that value.

A simple, effective response to this test would be something like, Oh, I can understand that. What had you hoped to spend on your storage unit? You may be surprised by the answers. Some people used storage years ago and have no idea where prices are today. Some get quoted a price for a smaller unit at another store and do not realize the difference. Or perhaps you quoted a price for a climate-controlled unit, and the store they called five minutes ago quoted them on a standard. You will not know if you do not ask, and you will lose the opportunity to justify your price and potentially make the sale.

Dont Make an Acid Test of Yourself

Dont fool yourself into thinking a caller isnt serious just because he doesnt make a decision right away or immediately visit your store. Not everyone in the market for a storage unit begins the conversation by saying, I need storage or asking, How much is a storage unit? Assume everyone who calls you is a buyer until you have asked a few good questions. The caller could be a mystery-shopper or a Yellow Pages representative confirming information. But odds are 99 percent of your callers are current tenants or prospects.

Finally, dont think your callers are too cheap to rent from you. Very few people actually know what storage costs and any price you quote could cause sticker shock. Keep in mind that even $10 a month is more than it costs a person to store his goods in his own basement, hold a garage sale, or put his stuff in the trash pile. When a prospect questions your price or compares you to a less expensive facility, it presents a great opportunity to sell your site and unleash your knowledge and sales potential.

Remember that people dont store with a storage facility; they store with the people who work there. You can rent to more prospects if you prepare yourself and take a lesson from these acid tests. You never knowthe next time your phone rings, it might be me! Good luck and good selling.

Tron Jordheim is the director of PhoneSmart, which serves the self-storage industry as an off-site sales force that turns missed calls into rentals. This rollover-call service serves as a backup to store managers. Mr. Jordheim has started several successful businesses from scratch, and assisted with acquisitions as general manager of the Mid-Missouri Culligan Bottled Water franchise. For more information call 866.639.1715; e-mail [email protected].

By Brad North

One effective way for self-storage owners to combat competition in their markets and enhance the profitability of their facilities is to create an appropriate atmosphere of order and discipline in their operations. This will not only hold staff accountable for their actions, it can motivate them to achieve their goals and objectives. One of the biggest differences between good storage operators and great ones is their ability to create such an environment.

Most owners need a better system to make their teams responsible for achieving results. For instance, it is imperative to track and measure key areas of a facilitys sales programsuch as how many callers and walk-in prospects are being converted into rentersto improve the business in the long term. Everyone involved in the selling effort should be aware of this conversion rate and what is expected in terms of future outcomes. This will give each person a scoreboard, showing him where he stands on the performance scale. Its important everyone be involved in setting the standard and creating the consistency needed to achieve long-term success.

One Month at a Time

One method of creating accountability is to set goals within key areas of the business. For example, you might set a monthly goal for unit rentals that is realistic but challenging. This will give your team an objective to work toward and help set the expectation in terms of acceptable and exceptional performance. Employees tend to like monthly goals, as they are more immediate and easier to track. If the staff has a challenging month, it can wipe the slate clean for the following month and look forward to refocusing its efforts.

Providing a monthly storage goal also creates a way to measure results and pinpoint areas for improvement within the sales program. Once weaknesses are recognized, additional training can be administered to rectify them. This can take accountability to a higher level and ultimately create an atmosphere of order within the organization.

Under Review

Most storage operators have a subjective review process for evaluating employees performance. This takes away from the semblance of control and often causes employees to be complacent in their jobs. For example, if a facility manager does not clearly understand his job description and what is expected, he will probably not perform as well as he would if he had control over his own destiny and the outcome of his performance review.

If appraisals are handled objectively, owners can develop much needed consistency in their operations and increase employee responsibility. For instance, consider a monthly audit/review that becomes a part of the annual performance evaluation. Areas to measure might be monthly storage goals, telephone mystery-shopping scores, sales-conversion ratios, customer referrals and key-influencer referrals. Also examine administrative functions and other key areas of the business. It is important to measure items the employee can impact through his own efforts. This will give him a sense of control over his outcomes.

Success as a Journey

As self-storage markets across the county experience saturation, the average operator must find new methods of improving efficiencies and creating employee accountability. Economic occupancies have decreased, largely due to operators reactionary tendency to give away the store when competition moves into their markets.

The philosophy behind a self-storage operation and the mindset of its owner determine its outcome. In other words, if the attitude of the team is to be proactive and find ways to improve, it will weather any storm. If handled properly, adversity can take operational performance to an entirely new level. The question is not whether competition will continue to increase, but how to deflect its detrimental effects.

Success is a long-term journey. Its running your business consistently and well. Unfortunately, many operators feel they have already arrived at their highest level of success. They become complacent and stagnant, and the competition passes them by. Always remember that success is not a finite destination but a continual effort.

Brad North is the founder of Advantage Business Consulting, which specializes in on-site sales, marketing, feasibility and operational training for the selfstorage industry. He has produced two live videos and a workbook titled Maximizing Your Sales and Marketing Program, which can help managers improve their sales and marketing efforts. He also launched A TelePro, a mystery- shopping service that assists in educating, evaluating and improving the phone-sales performance of self-storage professionals. For more information, call 513.229.0400 or visit www.advantagebusinessconsulting.com.

By L. Bruce McCardle

I was recently reminiscing with an industry colleague about the good old days in the steel business. The punch line was, those days were about six months ago. To put things in the terms of Dr. Spencer Johnson, the cheese has not just been moved, it has become hard to find and very expensive.

Since the crisis in the availability and cost of steel, the daily routines of many self-storage suppliers have changed. Some things we used to take for granted are no longer. We have to work harder to accomplish what used to be simple to achieve. We have to pay more attention to every task. The industry has changed significantly, and to not make proper adjustments in the way that we think and conduct business would be detrimental to our companies and our customers. To continue doing business as usual would simply not be wise.

The bottom line is, you can put whatever spin you want on recent events in our industry, but no amount of catchy advertising or this too shall pass thinking is going to make this one go away. There are shortages and price increases in steel, concrete and lumber. Fuel surcharges are through the roof, and shipping has become a problem. At some point in the near future, interest rates will start to rise. Whether we like it or not, and whether we choose to recognize it as relevant, the commercial construction industry and its market have changed, and more changes are coming.

As I shared this list of woes with my colleague, a friend and customer of mine, his reply was, Thats your problem. I just need to get buildings from you. He makes a good point. The American public is still going to buy stuff and will still need to store it. And developers are going to continue to build. Selfstorage facilities are still a sound investment that provides a great return.

With all of this in mind, it is obvious the same old routine for selecting a general contractor is not going to cut it. To excel in our businesses in this altered market, a new attitude is a must. Therefore, a novel approach when selecting a general contractor for your self-storage project is paramount.

Such a Deal!

Instead of looking at theoretical or academic reasons for choosing a contractor, lets look at the most common deciding factor: price. Until about six months ago, every builders goal seemed to be to have the lowest price, usually topped off with an unreasonably short construction schedule. Customers said, I want the best, I want it cheap, and I want it fast. We laugh at this now, but it is exactly what was driving the commercial construction market. These days, however, with the costs of some materials having doubled and some lead times exceeding 12 weeks, this is no longer a realistic expectation.

I am always amazed when successful, intelligent businesspeople evaluate bids for construction and respond by saying, These three bids are really close, but this one company is 30 percent cheaper. Wow, am I getting a deal! Usually, theyre not. Even in this dynamic business environment, you still get what you pay for. If you shop construction as a commodity, you will end up with materials and labor. If you hire a general contractor to provide professional services, you will likely end up with money in the bank.

Dont Should on Yourself

Keep in mind the final result of the construction process will be a product you are going to have to live with every day, as long as you own the facility. How many times have you made a major purchase or completed a significant project, having skimped a little here, cut a corner there, or made do with something, and later thought, I should have . . .?

Of course you have a budget to consider. Also consider that paying for the services of a good general contractor can result in getting more for the money you spend. A contractor with experience in building selfstorage will save you time, help you avoid common mistakes, and assist you to planning and coordinating with other components of the industry that are key in making a facility work.

When hiring a general contractor, the most important thing is to make an informed decision. I shouldnt have to say it, but I am going to: Check as many references as possible, old and new. It surprises me how often owners choose their hired professionals without talking to those who have worked with them. Also check a contractors credit. Ask subcontractors and suppliers about their experiences working with the company. This advice seems basic, but many people tend to overlook the obvious.

A Wise Decision

Maybe choosing the right contractor has more to do with you than it does the service provider. Maybe there are some questions you should ask yourself before you start interviewing potential hires. Here are three key questions to address up front:

1. How much money do I have?

2. How much expertise do I have?

3. How much time do I have?

Most of you have careers or other businesses. You have family and friends and hobbies, and now you are considering whether you can be your own general contractor, build your own storage facility and save a ton of money. Over the years, I have watched a lot of people try to save money this way; usually, it costs them more in the end. General contracting is a profession and more than a full-time job. You may be very sharp and good at what you do, but think of how many years, how many hard knocks it took for you to get to your level of success.

Decide what expertise you can lend to the construction process and how much time you can truly commit. When you have honestly answered these two questions, negotiate with a contractor and determine what your contributions are worth. A construction budget should include more than materials and labor. If you are going to be involved in the project, decide how much you are going to do, where you are going to need professional services, and budget accordingly. You may find the time you take away from other endeavors will cost you more than you can save by doing things on your own.

Building Relationships

In business, our success is usually due in part to our ability to judge peoples characters. In choosing a contractor, you are about to enter a relationship. You dont necessarily have to like this person, and you probably dont want to choose someone who is just like you.

As in any relationship, there are going to be good times and challenging moments. Choose someone you feel you can trust, someone with whom you can be upfront, and who will be straight with you in return. Choose someone with whom you feel comfortable dealing. One of my mentors always said to new clients, I want us to be as good of friends when this project is over as we are now before it starts.

In the end, the lowest price wont ensure a contractor can address all the other essential issues. Look past the slick sales presentation, the we are better than them marketing, the weve been doing it this way for 40 years spiel, and the no problem reassurances. If it was my project, my choice for a contractor, subcontractor or supplier would be the one who said, The construction market is changing and can be really volatile right now. We are going to do all we can to stay on top of it, quickly adjust and respond accordingly, and keep you involved and informed at every step.

L. Bruce McCardle is the eastern division manager for Mako Steel Inc., a nationwide supplier and installer of self-storage buildings that draws more than 80 percent of its business from repeat customers or referrals. Mr. McCardle has been involved in the metal-building and construction industry for more than 20 years. Look for his presentation at the upcoming ISS expo in Miami. For more information, call 888.795.7594; visit www.makosteel.com.