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23 Jul 2020

How to Drive Revenue with Retail Sales

Jim Mooney, Jr

Vice President of Operations

We have all heard managers and owners say that locks and boxes are a minor part of the bigger picture. Well, I for one tend to disagree. Boxes, locks and packing supplies can do a lot of good for the bottom line for your facility.

Have you ever listened to a call either via the call center, a mystery shop (a whole other topic for a different day), or if you have tracking numbers on your website and can evaluate the calls?

You start listening to a call where a potential customer is inquiring about storing the contents of their three-room house, where almost everything is going to be put in storage. The manager is so focused on getting the commitment for the rental that they fail to take advantage of a huge opportunity to get the person off the phone and into the store. Just stop and think for a moment about how this might play out.

Manager: “We can definitely help you with your storage needs. By the way, have you started packing your things yet?”

Customer: “Well, no. I am just looking for a storage unit right now.”

Manager: “Okay, great. Just to let you know, we have a full line of moving and packing supplies right here in the office as well as helpful packing tips so we can make your life easier. By knowing how many boxes you will have to store can effect what size unit you could use. Can you stop by the facility so we can get you the right size unit and possible save you some money in the process?”

Not to mention, this is building an important trust factor with your perspective customer.

Or, how about the customer who comes in and rents a unit and does not have a lock? How many times have we heard, “Oh, I will bring one back when I load the unit.”

Usually, this can be a headache down the road for the customer and the manager. Solve it now simply by making a lock purchase part of your lease presentation.

Assume the sale.

Manager: “We offer two different locks here, which one would you prefer?”

Do you know what your lock penetration and merchandise sales per transaction numbers are? When looking at reports from facilities, it blows my mind about the lost opportunities to grow revenue. Not to mention after reviewing facility leases, a customer renting a unit and not securing it at that time is a violation of the lease they just signed.

Lock sales are a GREAT opportunity to bring in more revenue for the store.

Let’s take a minute and do some quick calculations.

Assume you average 40 rentals a month and you have a 90% lock sale penetration using $12.00 as a lock cost. Your monthly lock sales of $432 multiplied by 12 months equals $5,184.

Taking the math a step further, assume a sale of $25 in merchandise (a lock and a few boxes – an easy sell) per transaction, using the same 40 leases per month and we now have gross sales of $1,000 per month, or $12,000 per year in added revenue.

What kind of value does this add to your property or portfolio if you extrapolate over multiple facilities? What kind of value does this add to your portfolio, say on a 5 cap?

Talking to other operators in the industry, they are getting these types of “add on sales.” Why shouldn’t you be part of this? Just food for thought.