Audits: 3 Types for Self-Storage to Assess Your Business & Staff

Are audits of your self-storage business necessary? Of course they are! Still, the process is one of the most lacking across the industry. The reasons many owners give for not auditing include but aren’t limited to:

• Why audit? My manager is a great person and would never steal. 
• I don’t have the time to deal with the report findings. 
• It’s too expensive.

If any of these words have crossed your lips, it’s time for an assessment. How often should you review your operation? The minimum is one major audit per year and then again any time you have concerns or a gut feeling that things aren’t going correctly. In general, audits are intended to do one of three things:

• Check the efficient operation of the site; 
• Examine a concern about falling occupancy or revenue, or increasing delinquencies; 
• Investigate tenant complaints about managers.

Unfortunately, many audits don’t take place until after the damage has been done, even if warning signs were present. Instead, facility owners should take a proactive approach to this often-dreaded process. View it as a check-in to make sure everything is on track. Additionally, clean assessments will reward an outstanding manager who’s doing his job correctly.

Let’s take at each audit type as well as any red flags that could signal your business is in trouble.

Efficient Operation

Operating a successful self-storage facility requires scrutinizing numerous facets of the business, including occupancy levels, rental rates, maintenance, retail inventory and more. Here are some things to consider when examining your property’s overall efficiency:

• Are the daily reports and bank deposits being made per your policy? 
• Is staff following your company’s phone script? 
• Is the curb appeal up to your standards? 
• Is the manager completing a weekly walk-through and verifying it against the computer’s unit inventory? 
• Are tool and office inventories up to date? 
• Are the petty cash and cash drawers balanced at all times?

If you’re lucky enough to have a results-oriented, take-charge manager, these areas are always in order. Proactive employees will typically welcome audits to show the owner they’re reliable and properly handling their multi-million-dollar business. These managers aren’t sweating when you announce an audit is taking place. A review can also show staff areas that require improvement.

Failing Operation

This category is the one that’s most ignored until the ship is sinking or close to it. Why? Self-storage is a secondary business for some owners, and they treat it as such. However, it’s a full-time operation with unique challenges. Would you let your primary business get to this point before taking action? Probably not. Self-storage is a special business that, left in the wrong hands, can quickly fail.

BIO:

AZSA Board Member Andy Kelly owns AB Kelly Realty and Sierra Self Storage Consulting, a full service nation al and international company specializing in operations training and market/feasibility studies.

This article is reprinted with permission from Inside Self-Storage. For information, visit www.insideselfstorage.com. 

Source: Behind Closed Doors, AZSA Newsletter Archives