July 2, 2019
Entrepreneurial propositions are a dime a dozen, and often that’s exactly what they’re worth. It’s also tempting for would-be business owners to invest in glitzy brands in high-visibility, consumer-facing industries, but those can be fools’ errands, too.
On the other hand, the storage unit industry is far from glamorous — it’s about as mundane as they come. But it’s as solid as a packed shipping container. Indeed, storage units are a growing and highly profitable business tied in with the massive U.S. real estate market, with great potential to prosper whatever the next turn in the economy may bring.
The commercial development of the storage unit business began in the late 1960s because of growing demand for residential and business storage in an increasingly mobile population and dynamic economy. It has continued to expand over the last 25 years, thanks largely to greater public awareness of the financial and personal advantages of self-storage.
Today, some of the benefits of owning a storage unit business include:
Rapid growth: The U.S. storage industry is winding up a period in which it was expected to grow at a compound annual rate of 4 percent from 2015 through this year, an increase from the 2.5 percent annual rate that the industry experienced between 2005 and 2014. This year, the business is expected to be worth $32.7 billion in revenues.
Smart niche: The storage unit business is comprised of three major segments: long-distance moving, local containers and local DIY moving. Each provides different investment dynamics, but local containers represent an especially strong opportunity. That’s because, while the decline in cross-country mobility by Americans has been well documented lately, the demand for containerized local storage remains robust. Some of the factors that have contributed to this demand include population growth, booming apartment construction projects, restoration and remediation projects, home staging related to real estate, and many others.
Real estate play: Both residential and commercial real estate, of course, have made dramatic comebacks since the crash that helped set off the Great Recession a decade ago. As those industries have revived, the storage unit business has ridden the wave, comprising a major dynamic of its growth over the last 10 years. At the same time, financial returns for the storage unit business, historically, have been better than for other parts of the real estate industry, providing both higher relative growth and better absorption of market declines. Meanwhile, the average rental rates and development costs paid by storage unit owners and operators have remained below those paid by other types of real estate markets, including multi-family residences, office and retail sectors.
Recession resistance: With economists and analysts unsure at this point of how much the U.S. economy might level off or even slow down, it’s important to understand that the storage unit business bucks recessions. Commercial and residential moving and portable storage needs do not disappear during a slower economy. In fact, in the residential business, for example, as the economy declines, people begin moving into smaller homes or apartments, creating storage needs. These structural aspects allow the storage unit industry to succeed through all types of economic conditions.
Friendly business models: New owners can enter the storage unit business via business models that provide low barriers of entry and reliable ways to gain traction. UNITS Moving and Portable Storage, for example, offers a franchise partnership which provides two unique structures: a “semi-absentee” model in which the franchise partner can keep his or her previous full-time occupation while operating a UNITS franchise; and an “owner-operated” model that features a more hands-on approach to running the UNITS franchise.
Founded by Michael McAlhany in 2004, the mission of UNITS Moving and Portable Storage is to provide personal customer service while supplying the most innovative equipment in order to eliminate frustrations associated with moving and storage space issues.
UNITS Moving and Portable Storage currently has 24 franchised and three corporate territories across the United States. With a presence in more than 40 markets, and growing, the brand is looking to expand with the right people in the right markets.
For more information on how to take advantage of this opportunity, or simply to learn more about the moving and portable storage industry, visit https://www.unitsfranchisegroup.com/ and fill out the inquiry form. We will reach out to you to talk more about your interest in our brand, and how UNITS Moving and Portable Storage can help you reach your personal and financial goals.