Earlier this summer, White Label Storage co-founder Peter Smyth sat down with Scott Meyers of Self-Storage Investing for a live webinar on one of the toughest questions in the industry: when a facility underperforms, how do you know whether it’s a market problem or an execution problem?
And once you know the answer, how do you fix it?
From due diligence frameworks to revenue management to how to read the market, the conversation covered a lot of ground. Here are a few practical takeaways from the session for any owners looking to improve performance.
Watch the entire webinar recording here.
1. Start With a Framework.
Before diagnosing any asset, owners need a repeatable way to look at performance instead of relying on instinct.
“If you’re thinking about something or analyzing something and it can’t be described in a framework, then you probably don’t fully understand it,” Peter said.
Peter uses a framework that breaks facility performance into four buckets:
- marketing
- customer service
- maintenance
- and revenue management.
Scott added NOI as a fifth bucket, noting “we’re looking at not only topline revenue and how to manage that revenue, but how do we keep the expenses down.”
That structure became the backbone for the rest of the webinar: at every step, the question isn’t “is this a good asset?” Instead, what owners should be asking is “what would a competent manager be doing here, and are we doing it?”
2. Most Underperformance Is an Execution Problem.
One of the boldest claims of the webinar came from Scott, who’s spent more than 20 years teaching self storage investors. Assuming an owner did real due diligence and bought in a reasonably healthy market, he said underperformance almost always traces back to the operator, not the market.
“All things being equal in a decent market, if your facility is not performing, then it’s nothing but an execution problem,” Scott said.
He went on, describing the execution gaps he’s seen most often: “You’re not keeping an eye on your rates. You don’t have a digital presence, you didn’t train that person, and then you took your hands off the wheel.”
It’s an uncomfortable truth for owners to hear, but Scott was clear that it’s also the more common (and more fixable) explanation. Blaming the market is easy. Fixing execution takes work, but it’s within your control.
3. Physical Occupancy Isn’t the Best KPI.
Don’t treat physical occupancy as the ultimate scoreboard. High occupancy doesn’t always mean strong performance; sometimes it just means you bought your way there.
“Extra Space pioneered the method of just getting people in at any rate and then treating them as test customers using ECRI,” he explained. “It does not mean strong performance. It may mean you’ve bought a lot of that occupancy with high marketing spend through discounts, concessions, and high ad spend.”
The lesson for operators evaluating their own facility or a potential acquisition is to always look at economic occupancy over time, not just the snapshot on today’s rent roll.
4. Answer the Phone. It’s Important.
Customer service is where small operational gaps compound into real revenue loss.
Peter pointed to concrete call center benchmarks: “We need to pick up 80% of our calls in 20 seconds or less, and we need a 95% pickup rate. If we aren’t hitting those KPIs, then you’re going to miss leads. Your conversion rate is going to go down.”
Scott added a more personal take on why this matters, describing tenant retention as one of his biggest pet peeves: “We spend all this money and we spend all this time getting these folks in here. Just take care of them. It doesn’t take that much. There’s no reason for them to leave if you take care of them, other than they just don’t need the storage anymore.”
5. Don’t Wait on ECRI After a Renovation.
When you upgrade a property, don’t forget to upgrade your rates to match is a recurring problem.
“If people are truly turning a facility around, they have an opportunity to push rates higher, but they continue to increase rates to the same level of where the facility sat when they bought it,” Scott said.
If you’ve added security, resurfaced the lot, or fixed deferred maintenance, your rates need to reflect the new, improved asset, not the property in its previous condition.
6. Know Your Numbers, Then Assign Responsibility.
Scott closed the session with a mantra that summed up the whole framework: if you’re the investor and operations isn’t your forte, don’t wait around hoping problems fix themselves.
“If you’ve got an execution problem but you’re not the person to solve it, then stop, figure it out, and then find who’s going to be able to be responsible for those numbers.”
Whether that “who” is a new manager, a revenue management tool, or a third-party operator, the point stands: performance problems don’t magically fix themselves. They get fixed by someone taking ownership of the numbers.
About the Author
Zach Watson is the Senior Content Manager at White Label Storage, a leading storage management company. White Label Storage currently manages over 300 facilities across 43 states.
Source: White Label Storage
