Many people renting self storage units are in the process of moving. So, it makes sense that they would need a moving truck. In fact, Inside Self Storage reveals that two of every 10 customers require a truck to transport their items in and out of storage units. When your customers need a moving truck, they'll turn to moving companies if you don't offer truck availability.
Why let the moving companies get that rental money? You can offer self-moving truck rentals of your own and capture those profits. Of course, there are other advantages to self storage truck rental (and a few disadvantages) beyond besting your competition. In this blog, we’ll take a look at both.
Pros of Self Storage Truck Rental
The self storage business model is changing, and today, more and more storage facilities are offering truck rentals. In particular, self storage REITs have certainly latched onto this concept, and for good reason. Check out the benefits of self storage truck rentals below.
Increased Storage Unit Occupancy
While a rental truck in and of itself may not be a big money-maker since most facilities offer the rental for free with a new lease, it’s almost guaranteed to increase the number of storage units you rent. People needing a moving truck and a storage unit would prefer not to deal with two companies. Plus, rather than offering storage unit deals and discounts that cut into your bottom line, you can use the free self storage truck rental as an incentive.
In addition, if a potential tenant is on the fence about whether to rent a storage unit, a free truck rental is a great closing tool. When managers struggle with closing a deal, they will have more to work with when they can offer a free truck rental with the signing of a new lease.
Revenue from Fees
Along with the increased revenue you bring in more storage unit rentals, you can also charge for the rental truck in a number of ways (while still advertising the rental as free for new move-ins). For example, mileage and fuel charges. A fee for a damage waiver is also not uncommon. The income earned from these fees is yours to keep as an additional revenue stream.
Brand Visibility for Your Storage Facility
A branded vehicle is free advertising. “Wrap” the vehicle, and it’s like a moving billboard for your self storage facility!
The Outdoor Advertising Association of America (OAAA) reports that 98% of in-car audiences notice vehicle graphics and that a single vehicle can garner, conservatively, at least 10,000 impressions per day. Not only that, but since the “ad” is mobile within the community, people will see it numerous times throughout the year. This helps with brand recall, so when they’re looking for a self storage facility, they’ll think of your brand name. Studies also show that 32% of people have visited a website as a result of vehicle advertising.
You can also use your trucks to help out within the community to build goodwill. For example, you can lend your branded truck to charities to help them with their fundraisers, such as food drives and holiday toy collections.
Competitive Differentiation
If other self storage facilities in your area are offering truck rentals, you may need to do the same to keep up with them. If they’re not, offering self storage truck rentals is a way to gain a competitive edge. Not only will you have a moving billboard passing by your competitors’ sites, but you’ll also have a word-of-mouth advantage from tenants who have used your trucks.
And think about it: When someone needs both a truck rental and a storage unit, why would they go to two companies when they can go to one facility for a one-stop-shop? Truck rentals solve the need for convenience, and let’s face it, that’s what most people are looking for these days.
Cons of Self Storage Truck Rental
There can be some downsides to self storage with truck rental, so it’s important to consider expenses and impact. However, we’ve found that many of these negatives can be turned into positives. Take a look below.
Initial Costs
Purchasing a rental truck comes with a price tag. The “cost to launch” is certainly something to consider if you’re struggling financially. Of course, you can always lease trucks, which will be less expensive. In fact, the monthly lease payment might even be 100% tax-deductible.
If you lease, consider a TRAC (terminal rent adjustment clause) lease. A TRAC lease is designed for vehicles intended for commercial use more than half of the time. It provides several benefits, including unlimited mileage. This way, no matter how much mileage renters put on your truck, you pay nothing (of course, you can charge them for mileage). TRAC leases also give you the ability to purchase, return, or trade in at the end of the lease. Trading in is a great option as it gives you the ability to show off newer trucks, rather than continuing to use older models.
Truck leasing programs offer all the guidance you will need to implement the program at your facilities. They also provide the forms, including the truck rental agreement, protection requirements, and inspection and maintenance checklists.
Vehicle Maintenance
As with any vehicle, self storage moving trucks need maintenance. This is no different than what you’d do for your own vehicle: oil changes, inspections, tire rotations, etc. This can all be done at any local shop or dealership.
Of course, it’s important not to skimp on regular maintenance no matter how tempting it is. Regular maintenance helps prevent major repairs down the road. Plus, you also don’t want your truck breaking down on renters and you don’t want to lose out on a potential new tenant because the truck is in the shop. Just in case you do have a major repair, it’s always a good idea to get an extended warranty.
Liability
This word makes anyone nervous, but this is what insurance is for! Many insurance companies offer rental insurance, just be sure to shop around for the best coverage at the least cost. While it may be tempting to get personal auto insurance on the vehicle(s) as it’s likely to cost less than commercial insurance, be sure to pay the extra and get the coverage you need. The last thing you want is for a tenant to get into an accident and find yourself footing the bill because the insurance company denies the claim after discovering you were using the vehicle for commercial purposes.
Pro Tip: Make sure your rental forms follow all state regulations, look for a policy that doesn’t raise your premium with each claim.
Considering Self Storage Truck Rentals? Speak with a Self Storage Consultant!
As you can see, the pros of self storage truck rentals typically outweigh the cons. Even the so-called cons can often be solved through leasing, regular vehicle maintenance, and liability insurance. Who knows, the truck rental program may be such a success that you offer movers too. Hiring some “on-call” part-time movers or using an app like Dolly to hire movers is just one more service you can offer tenants (and charge for).
Have more questions about offering self storage truck rentals? Have more questions about the self storage business in general? You can always speak with a self storage consultant. Get the book on self storage consultancy from Storelocal® today.
