Wayne joined StorMan Software in 2007 and is the Vice President of Sales and Marketing in the USA.
Title: How can a small facility make and save more money?
Date: 18th June, 2008
A quote from Winston Churchill, victorious Prime Minister of Great Britain during World War II: “It has been said that democracy is the worst form of government except all the others that have been tried.”
In other words, he was saying that democracy, whilst probably the best system of Government developed so far, has its problems. America is blessed with one of the best designed systems of democracy in the world.
There are some democratically elected Governments in this world that, apart from the right the public have to vote at election time, have no checks and balances in place throughout their term. In these countries, between elections and with the support of fellow parliamentarians, the elected politicians in office can pretty much do as they please. This means they can make un-popular decisions in relation to laws introduced. They may pay the price at the next election, but the un-wanted law is in place and usually stays.
Other countries have some checks and balances in place. For example, Switzerland has a system where, as long as there is sufficient public support, citizens can initiate a referendum on an issue and the Government has to listen.
In terms of a democratically elected Government, Americans have something very special and unique. The American Government is made up of three separate branches, each with its own authority, which is equal to that of the others, so that one does not become too powerful. The legislative branch makes the laws, the executive branch carries out the laws, and the judicial branch interprets laws and punishes law breakers. Having three branches of Government provides natural checks and balances for the American people, and allows for effective and productive Government.
Business is all about being effective and productive too. As such, certain checks and balances in business can mean the difference between bankruptcy and despair or wealth and happiness. We would suggest that, with profitable checks and balances in place, a business of any size, especially small ones, can dramatically improve profitability.
So, how does one introduce such checks and balances into their business? The answer is simple. Buy some good management software.
Let’s take late fees as a simple example. Can a 1,000 unit operation afford to miss a $20.00 late fee? You might think it probably can. But you can bet the owner of that business does not agree. That is why they have management software to track and ensure all late fees are charged and collected.
$20.00 to a 1,000 unit facility charging an average rent of $100.00 per month is just 0.0002% of the maximum potential monthly chargeable income.
Can a 40 unit operation afford to miss a $20.00 late fee? No way! To a 40 unit facility charging an average rent of $100.00 per month, $20.00 is 0.005% of the maximum potential monthly chargeable income. Missing just one $20.00 late fee is far harder on the 40 unit operation than it is on the 1,000 unit operation. The 1,000 unit business won’t entertain the idea of missing out, so why should a 40 unit business?
A good management software package will, without undue effort or stress, ensure all late fees are charged. It makes it so simple to capture this extra profitability that it seems a shame for you not to have it.
Let’s take a month’s rent as a second example. $100.00 to a 1,000 unit operation charging an average of $100.00 per unit is 0.001 of the maximum potential monthly chargeable income. $100.00 to a 40 unit operation charging an average of $100.00 per unit is 0.025% of the maximum potential monthly chargeable income.
A good management software package will ensure all rents are charged. Let’s consider the value of having a systematic rate revue system in place. By reviewing your rental rates on a daily basis our studies show that rental chargeable income can be expected to increase by as much as 14% over a year. For a 40 unit business, charging an average of $100.00 per month per unit, an extra 14% annual revenue chargeable income is $6,720.00. If you were the owner of a 40 unit facility, what would you do with you extra $6,720.00 per annum? And that is just for the first year. By extrapolating another 12 months income, the 14% “bonus” next year would be $7,660.80!
A good software package will possess an automatic rent revue system. What about delinquent payers? A good software package will integrate with your gate system so that delinquent payers cannot access their goods until they have paid their storage account. Usually a delinquent tenant will drive up to the keypad, key in their PIN, and have the system tell them they cannot gain access without reporting to the owner/Manager. The owner/Manager will explain that they cannot gain access to their stuff until their account is paid up, and that it is the system, not the owner/Manager themselves, that is preventing the access. In our vast experience, payment is rapidly forthcoming in this type of situation.
A good management software package will work to maintain the operation of your business as a storage revenue generator rather than a debt collection agency. What about increasing time spent on production? Can a single owner or Manager work 24 hours per day, 7 days per week? A good software package will allow online searches and reservations to be made 24 hours per day, seven days a week. Even if you, as an owner or Manager, are working 50 hours per week, your business could be toiling away attracting more business potential for a further 188 hours per week.
Even though these 188 hours are times when not as much business occurs anyway, even if these additional hours were only 5% as productive as the 50 hours you work, your business is keeping up with inflation. It is costing you a mere pittance and taking no effort on the part of the owner or Manager to keep the doors of the business open all night long.
A good management software package will integrate with other technologies (such as a web page) to increase your marketing success.
What about making it easy for your customers to pay you by facilitating on-line payments? A good software management package will enable your customers to pay their storage account whilst the owner or Manager of the facility is asleep in bed.
What about enabling the owner or Manager to go away from the site for well deserved R&R? Rest and relaxation is important in business. Not only does it provide the opportunity to re-charge, but rest and relaxation also stimulates inspiration and creativity. Many people report having great (perhaps even profitable) ideas whist doing something that is not mentally taxing and enabled the mind to relax. Examples of this are those people who have great ideas mowing lawns, vacuuming the house, jogging, or showering.
But sometimes it is very hard for an owner or Manager to leave site and take an extended break. Sometimes problems can come up beyond the ability of temporary or part time staff to deal with and the owner or Manager has to be called in. I have personally heard of Managers who report not having had more than 3-4 days off in a row in the past seven years because they had to be ever available to remedy any issues on site.
Good management software can connect you to your business from anywhere in the world. What about being able to easily, efficiently, and effectively communicate with your customers through the post, email, and (in some states) SMS text? If your customers are late paying, or if you want to encourage them to share a promotion with their friends and family, you can let them know without even having to pick up the phone or pay for postage.
A good management software package will help you to employ communications with your customers so you can make and save more money. What about being able to get the support you need, when you need it? Operating any software package can seem a little daunting at first. Operating a software package when your site has gone down and you cannot perform a simple business function like selling a roll of tape to a customer is downright stressful! This is when support access becomes critical and is a good case for considering carefully whether or not you wish to go with a web based system.
Accessing support can be made difficult due to a number of issues. The first is time zones. The next is the workload on the support team in the offices of the software supplier concerned. Some storage management software companies have up to and in excess of 500-600 clients per support person. Another issue is the complexity of the system you have, the things you are trying to do with it, and the robustness of it. Robustness is critical to your profitability so having the cheapest solution is hardly ever the best idea.
A good management software package has lower customer to support staff numbers. The best we have heard of has a policy of no more than 150 clients per support person. Also, some of the best management software companies have multiple offices, all around the world, and a system to prioritise emailed support requests. This means you can receive support via email from the first available support person in the world at any time. Some support companies have taken up to 3.5 weeks to respond to a site down. The better companies have a policy of getting a site back up within 4 working hours. Lastly, the best software management packages integrate to those other systems such as access control and kiosk technology that has been developed, tried, and proven specifically for the storage industry. Having a system that is industry developed by experienced industry specialists brings the requirement for support to minimum levels in the first instance because of the fundamental integrity of the system itself.
What about making head or tail of all the software options out there? Do I go with web based or stand-alone? It is widely assumed there are the only two options. Web based, or stand-alone. The truth is you can have a stand-alone solution with as much or as little web functionality as you desire your business to have. You own the software, you control the database 100%. You still get to introduce benefits such as web based searches, reservations, and payments to your customers, (if you want to) with some stand-alone software management systems.
A good management software package gives you as much or as little as you want or need, at a price break that is not disproportionate to your requirements.
What about the value of you and your employees being able to say that their place of work is a nice one? StorMan Software is owned by Stephen Davies. Stephen started writing storage software in 1987. When he made a presentation to his worldwide staff at a recent conference he spoke of the reasons why he started StorMan in the first place. He said that, at the time he began writing storage management software, he did not think that anybody was providing software that made operating and growing a storage facility an enjoyable experience. He said it was more than putting in place the business checks and balances we have mentioned herein.
It was also about arranging said checks and balances so that it was part of the fun of being in business. In short, he wanted the checks and balances to seem more like a lifestyle decision than a chore. He spoke of the satisfaction he gained every time he spoke to a client a few months after they had come on board with him. He said his customer’s smile and enthusiasm was a major motivator for him to maintain his sales and marketing efforts. If you could speak with Stephen, perhaps he might tell you that this, job satisfaction, is the best reason why even the smallest storage business should have good management software.
Wayne R.
Vice President Sales and Marketing, StorMan USA
