Real estate is a great investment because its market value appreciates over time. However, if you want immediate returns, the best way is to generate turnover by putting your property to business use. The problem is most businesses that entail utilising real estates, such as building residential rental suites or leasing office space, can be capital intensive and time-consuming to set up. If you’re looking for a less complicated business acquisition, don’t fret. There are several simpler and less costly ways to make profits out of your real property. One particular example is by running a rental storage unit business.
In a progressive country like Australia, the increasing urbanisation in its major cities — Sydney, Melbourne, Perth, Adelaide, Canberra, and Brisbane — is further heightening the demand for storage services. In fact, the industry revenue of self-storage in the Australian market has shown an annual growth of 1.3% over the recent five years, leading to a whopping $1.2 billion in 2019.
In line with that, there’s no question that a storage rental business can help you rake in hefty sums. But how exactly do you start one? Here, we’ll provide you with the fundamental steps.
Conduct market research
Of course, you can’t go to war without a fully loaded gun. In the same manner, you can’t start a business without having prior knowledge of the demographics and psychographics of its market, as well as the present competition. Do some feasibility studies to know the demand, as the results can guide you in deciding what type of facilities to offer.
Are you going to provide private units to be locked by the renters, or maybe coin-operated lockers are the trend in your area? You can also try leasing self-storage mini-warehouses. Indeed, there are many options and ideas that you can look into so you have to determine the needs of your prospective customers in order to pick the right niche.
Create a concrete business plan
How exactly do you want to run your business? Will you do it full-time or still continue with your current job while managing it on the side? Moreover, think about the future. Do you want to expand your business someday and make it available for franchising?
List down both your short-term and long-term goals with their accompanying set terms and you can work out your strategies from this point. Consulting a business adviser will also be helpful so don’t hesitate to seek professional advice if you feel the need for assistance.
Identify legal regulations and secure required documents
Granted, it’s a requisite to ensure compliance with all the legal regulations that apply to the storage unit industry in your area of operations. Moreover, you have to register your business and take care of tax requirements. If you feel lost, you can always hire a lawyer to help you understand licenses and laws that you need to acquire and follow. As a plus, you can also ask information about financial aid and grants that your local government may be providing for small businesses.
Calculate your start-up costs
Once you have a more established idea of what you want to do and what you’re required to provide, you need to compute your estimated start-up costs. After that, you also have to determine the expenses for the actual managing of the business such as on-going maintenance and operational costs.
As for the initial costs, make sure you cover building construction, consultancy fees, website development and hosting, advertising and marketing materials, and equipment and facilities. In addition, allocate an adequate amount for unexpected expenses.
In all aspects of life, careful preparation is essential. That is why you must plan tediously and diligently to boost the success of your business.