Do you sell boxes?
"Ancillary revenue" might sound complicated, but most self storage operators are very familiar with these additional revenue streams.
Storage is often touted as a fairly hands-off way to make money off of the property you own. This is becoming less the case, though, as competition rises and rates drop.
How do you maintain a decent profit while competing with national operators who drop prices lower than you are comfortable going?
With ancillary revenue streams.
An ancillary revenue stream is an additional way for your business to make money.
Airlines, for example, make additional revenue by selling merchandise or charging fees to carry additional baggage. Their main product is the service of flying you to your destination, but they supplement that revenue with other offerings.
This isn’t the only example of ancillary revenue that you’ll be familiar with from your daily life, either. It’s everywhere!
Movie snacks or merchandise sales. Makeup at the convenience store. Specialty mugs at your favorite themed restaurant.
These are all ways that these businesses make additional revenue past their main product or service offering.
IMPORTANT: Always remember that ancillary revenue is an ADDITIONAL revenue stream that shouldn’t come before (or negatively impact) your main revenue stream.
To say it another way, don’t harm rentals, rates, or other aspects of your storage business to prioritize ancillary revenue instead.
Sounds great! Time to start selling popcorn and light-up mugs at your storage facility, right?
Well, probably not.
There are other ancillary revenue streams that make sense for self storage. You’re probably familiar with most of them, but there may be some you haven’t considered yet.
Can you guess a few? Do you use any at your facility now?
Let’s take a look at how your storage business can make more money to supplement your storage units.
Boxes and other moving supplies Well, this one’s a no-brainer. If you aren’t doing this, it’s not because you haven’t heard of it before.
Selling boxes, tape, locks, bubble wrap, and other moving and packing supplies is a great way to supplement your facility’s income.
It goes hand-in-hand with running a storage facility. After all, your customers need to buy those items somewhere - why not with you?
Insurance (or protection plans)Insurance—or tenant protection plans—should also be a familiar revenue stream for storage operators.
This can be a win-win for operators and tenants. After all, everyone wants peace of mind. If a tenant can provide their own proof of insurance, great! Otherwise, you make a moderate bit of money off their monthly fee and their belongings are protected.
This is an easy way to make some additional income from each rental. Just make sure you understand the laws or get in touch with a legal expert who does.
Rental trucks If you’ve got plenty of extra space at your storage facility, one option available to make more money is to offer truck rentals.
There are a couple of ways to do this. You could buy your own trucks and rent those out if you have the time, motivation, and funding.
A simpler method is to work with a company like U-Haul or Penske to facilitate the rental of their vehicles.
The benefits of having your own vehicles include wrapping them for marketing as well as not having to send any of the profit towards another company.
On the other hand, going with Penske, U-Haul, or another rental company means you won’t need to do nearly as much marketing for the truck rental part of your business.
Special unit alarms and locks Get your hands on some special locks or alarms—such as the storage unit alarms from SpiderDoor—and offer them as an optional add-on for tenants.
Many of these are incredibly easy to install just by sticking onto the wall or door. You buy them once and can easily make a return on your investment as customers pay for them over time.
Peace of mind for your tenant and a bit of extra revenue for you!
Package receiving or shipping Have you ever dealt with porch pirates? Or maybe lived in an apartment where receiving packages can be pretty miserable?
Well, your customers probably do. This may vary from market to market, but in the right market, offering to receive packages (and maybe place them in a storage unit) for a small fee is a great way to make some extra income from your facility.
Some operators even offer to help ship packages, becoming a great option for businesses or for individuals who do a lot of shipping and receiving.
Boat and RV storage For some facilities, boat and RV storage isn’t really an ancillary revenue stream. But it can definitely be considered one for many.
Haven’t we all seen that drive-up storage facility that has campers and boats parked wherever they’ll fit along the inside of the fence? Let’s face it—that’s not their main business. The facility wasn’t designed for that.
But it doesn’t matter. They’re making additional revenue off the space, maximizing the profits their property brings them.
Notary services If you (or your manager) are a notary, performing notary services at the facility’s office is another potential revenue stream.
Consider how many of your tenants might transfer the title of a vehicle they are storing with you or who may be facing a variety of life changes that will eventually involve notarizing documents.
If they can find that service right at the storage facility they’re going to go to anyways, it provides a convenient and comfortable option that brings more money into the facility.
Solar installations Picture a classic drive-up self storage facility.
Rows of buildings. Lots of flat rooftop space. Very few trees.
Yea. I think you can see where this is going. Whether or not you care about green energy or appealing to younger renters, renting out your rooftop space for solar installations is a way to bring in more money.
Leasing land for cell towers If you have extra land and don’t want to expand into boat and RV storage, you might consider renting it out to mobile carriers to build towers.
If you don’t have a lot of property but have a multi-story facility, a rooftop antenna array is also a possibility.
The added benefit? Your staff and customers will have great service while at the facility!
Leasing land for billboards Another option to use up some of your leftover property while making more money is to rent it out to billboard owners.
If you’re in a desirable location for a billboard, you can bring in a good chunk of money each month by allowing someone to post one up at the corner of your lot!
The most obvious reason to utilize these ancillary revenue streams is to make more money.
But there’s more to it than that. There are advantages even if you’re not concerned with squeezing out every last drop that you can from your property.
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