I am a private storage owner having to deal with 2 big name competitors and the one month free deals. I am losing potential customers when they call asking if I offer one month free and the answer is no. They hang up. Offering the one month free take serious cash flow away, and I have the fear that some customers are just looking to drop off unwanted junk that I will have to pay to remove the second month. What are your ideas? Is there a way to compete with the big name competitors?

Thanks for the vote of confidence. It gets frustrating when potential customers call and then hang up once they cant get the first month free. Are these one month deals gimmicks? or are they legitimate?

dennis,

a lot of these $1 a month move-ins require that the tenant stay at least 3 months. remind people that there is no requirement (if there's not) to stay. we aren't running any free month, or half month specials, we just remind potential customers that are prices are just a little lower, but in the long run, they end up saving because are prices *are* lower and we don't have the added fees for start-up or require lock purchases. you just have to remind them that they get the service they pay for - if it's only $1 to move in, what quality of service will they get?

-kat

Most of the people who are looking for the "special" are looking for a place to dump the junk.

I have had reports from some of the managers or the "big guys" that it is a rare month that they don't find a unit full of trash cos it was cheeper then going to the dump!

Not gonna happen here!

If they are serious about renting a space they soon learn that there is a price to be paid for that "special" in higher rents. I have those people move their stuff over here all the time.

__________________
Wayne
All American Self Storage
Palmdale, CA.
webmaster@all-americanselfstorage.com

Dennis,

The reason I quit 1 month free was I was taught the true cost in profit reduction for the company.

If your prices are right and your occupancy is 90% you are getting about 10% of gross income for profit. If your average length of stay is 10 months you are giving 100% profit each time you do it. If your average length of stay is 15 months you are giving 50% profit ect.

Try this: Add the monthly cost of one free month up, move that to advertising budjet and imagine the impact on calls per day to close from.

The second reason I quit was, I try and track where my customers go from here and I saw the type of customers who were going to the one free month option. Some move around just for the free storage.

If a customer is not closing because of price I will explain the true cost to him if I used this system: Basicily I could not give the services or quality of service he is currently experiencing from me.

Yes these are all great responses. I have heard of the junk yard dump offs. That is one that needs to be avoided. We are listed cheaper than the one mont free guys. I guess the position to take is, If the customer only wants the one month free deals, we dont need their business. Thank you all for the great answers.

Dennis,
Nothing free is ever really 'free'. There is invariably some catch associated with the bait, whether it is a time commitment for the tenant or something else. Don't get caught up in trying to be the low price leader; anyone who bases what will likely be a long-term decision on whether they get the first month free or not is likely to be a hassle of a customer.

Go with what differentiates you - you are not a chain, you live right there and go to the same stores as your customers, enjoy many of the same activities, etc etc. You're part of the community, not just someone looking to profit from it.

Took me a while, too, to get over the price thing when a prospect mentioned it. I don't apologize for it anymore; in fact, it helps to reinforce what folks get for their money, as in "since we're not the low price king, what do you think that thousands have seen that makes them comfortable with paying a little more?"

There are people who will always be driven by price and there are people who respect and appreciate value for their dollar. Give them reason to see the value and you won't just have satisfied customers, you'll have loyal customers.

I have used the first month free successfully. I dont like giving up the month anymore than anyone else. However, if it gets renters that stay for 8-10 months, it is definitley worth it. Obviously, if you are full you dont need to offer the special.

We are a small (122) unit facility in Florida. We never had to have specials to fill our units until the last 6 months. We went from 100% occupied to 80% in less than two months. We bit the bullet and offered a move in special for $10 plus tax (with minimum 2 month rental), then bit the bullet again and offered first month free and now we are back up to 98% occupied. Have had no problems with people 'dumping' - in fact majority of new tenants are still here after month 3 and 4. When you have a major competitor running ads on all channels for $1 move in, $4.00 a gallon gas and people out of work you need to be flexible. We also now offer a customer loyalty program which knocks off some rent for referrals.

I just read what everyone had to say about the free month...I also am having the dilemma of "should I or shouldn't I" offer a free month. EVERY facility in our area is offering at least 30 days free, some 40 days free. But, our facility is BY FAR the cleaniest, the best customer service, and just overall the best (not to be prejudice, it's just true!). I will offer 2 months at 1/2 price if it comes down to it, but I don't like to get customers that way. I try to get them to come and see our site, and know WHY we are the right choice. If I can get them here, I can rent to them! I also am running into the customer on the telephone who wants to hear nothing BUT prices, and will get angry if I try to tell him anything about why we don't offer a free month, but that our rates are very competitive as well as other highlights of our facility. Some people don't understand, if you are going to pay let's say $100 for 10 months, that's $900 with a free month, OR, rent with us and pay $95 for 10 months, that's $950, when their 10 months is up, their valuables, their priceless items, are going to be safe, dry, smell the same as they did when they came here, etc. There is a facility not far from us that I've heard from several people if you rent their, your things will smell like mold after a month! Why bother paying for storage at all if your things are going to be ruined!!! It drives me NUTS!!

Anyway, I love getting input from everyone, and I just thought I'd add mine. Again, I have offered 2 months at 1/2 price, and get the money up front. Right now the economy is so bad, people just don't realize what they could lose by saving themselves $50 or $100. Our service alone is worth paying for that first month, we go above and beyond to make sure our customers are satisfied - like someone else said, I don't just want satisfied customers, I want "Raving Fans"!