The self-storage industry made over 27 billion in America last year. However, about 155,000 storage units went to auction because renters didn’t pay their monthly dues on time. While popular shows like Storage Wars and Auction Hunters had glamorized storage unit auctions and made them seem excessively profitable, that’s not reality. In fact, for most self-storage business owners, public auctions are only used as a last resort to recoup a portion of unpaid bills. Most owners don’t enjoy auctioning off their renters’ belongings to the highest bidder; they’d rather have the renter pay their bill, so they don’t end up eating the cost of unpaid rent.
What’s The Easiest Way To Collect Rent?
On average, a 10×20 foot, non-climate controlled storage unit rents for $125 a month. At a typical auction, bids for storage units rarely go above $300. That means that the average sale will only help the self-storage business owner by recouping about 2.5 months of lost wages.
Pay More Attention To Due Dates
It’s much more profitable for self-storage business owners to collect rent when it’s due instead of trying to make lost rent back in auctions.
The number one reason that people don’t pay their monthly bills on time is that they forgot about them. This is especially true for the self-storage industry. Your renters don’t see these items every day, so they don’t think about what it takes to keep them. Out of sight, out of mind.
Distribute Payment Reminders
Self-storage business owners looking to collect their rent money on time should be distributing payment reminder notifications
The most effective payment reminder notifications are sent according to the recipient’s preferred communication method, either email, text message or phone call. Sending your payment reminder notification to the device your renter checks the most all but guarantees that your message will be received.
Advanced payment reminder notification systems will allow you to store your renter’s contact information in it so you can reach out easily every month. It will also provide you with a monthly report that shows you who was contacted, when they were contact and what contact method was used. This means that your renters can’t say that they didn’t receive their payment reminder notification, and that’s why their payment is late.
To be most effective, your payment reminder notification system should direct your renters directly to a platform on which they can make a payment as soon as they receive their payment reminder notification.
Offer More Ways To Pay
You can use a pay by phone system to accomplish this. For example, if you send a text message or an email, include a click-to-call phone number that directs your renters to an automated and self-service phone line that makes it possible for your renters to make an immediate over the phone payment.
A pay by phone tool allows your customers to pay by entering their credit or debit card number, ACH or echeck. You’ll want a pay by phone tool that is PCI compliant, so you’re not subjected to liability, and so your renters can make their payments without feeling like their info can be stolen.