Revamping Revenue in Self-Storage: The Case for Online Auctions

Self-storage facilities are always looking for ways to streamline operations and maximize revenue. One potential avenue, detailed by Carlos Kaslow, General Counsel to the Self Storage Association, in a post titled "Should You be Doing Online Auctions?", is transitioning in-person auctions to an online platform, unlocking flexibility and asset fluidity.

Kaslow, a law expert and legal consultant to top U.S. self-storage operators Public Storage, Inc., Shurgard Storage Centers, and U-Store-It, mines this topic with his characteristic insight and clarity. He focuses on the potential for improved inventory control and the financial benefits unbundled by digital auctions.

According to Kaslow, when a storage space falls into arrears, live auctions typically occur around two months after the last rent payment. However, facilities often delay these actions until several spaces are delinquent, extending hold time considerably and negatively impacting revenue, particularly when vacancy rates are low.

Unlike live auctions, online auctions don't mandate a substantial pool of delinquent spaces to be effective. Prospective bidders, free to participate remotely, can submit their bids irrespective of whether an auction features one space or a dozen. This allows facility owners to schedule auctions for each delinquent space as needed rather than conforming to an imposed date.

Case in point, Kaslow references one operator who couldn't auction a significantly overdue space for two months because it missed the in-person auction date by a meager two days, delaying income generation. Such instances starkly illuminate the strengths of online auctions over their traditional counterparts.

Online auctions represent a strategic approach to liquidating spaces in arrears, particularly beneficial for smaller facilities in rural areas where in-person auctions might be sparse throughout the year.

Could be Better If:

While Kaslow provides a substantive exploration of the benefits of online auctions, the post could be improved by including real-life examples or case studies from facilities that have switched to online auctions and noting the results. It could also offer advice on how to transition to online auctions or recommend some platforms to use for these online auctions.

It would also be beneficial to briefly outline some potential challenges or downsides to online auctions to give facility owners a comprehensive perspective when considering this move. Such information could include discussing technological barriers or potential legal considerations with online lien sales.

🔒📚 Hi! I'm Eric Manning, a self-storage operations nerd, and lifelong learner. 🗝️ My articles blend industry know-how with a dash of humor and wisdom. Whether you're a storage newbie or a pro, join me as we explore the world of storage, one witty insight at a time! 📦😊🔑