Getting Inside Self Storage Franchises – The Process to Buying into a Franchise

The potential financial opportunities that a self storage business offers are well documented and individual success abound around investment circles - these opportunities are dramatically increased when an investor purchases a franchised storage facility; however, the means to getting inside self storage franchises can be tricky and potentially expensive if you do not know the ends and outs of the process. This process includes researching and identifying potential franchises to buy into (there are dozens of options between local, regional, and national storage companies), negotiating the terms of the franchising agreement, placing a payment down on the rights to the company’s logo and name, and finally taking over physical ownership of the property in question.

The first step to becoming an independent owner of a franchised self storage facility is to research the companies that offer a property in your area. First of all drive around the community in which you are thinking about investing in. Do they have several self storage facilities already established? Is there a large residential population to tap for potential customers? Does the area offer affordable property options on which to build the business? Once you have found an area that offers the advantages of a large customer base without a lot of localized competition, then you must research which companies are looking to build a franchise in your area. The internet is a great tool for this step of the process. It will allow you to get inside self storage franchises much easier.

Once you have found an area in which to invest and a chain that is looking to extend its commercial presence in to that area, then the next step is to contact that chain and discuss the franchising costs. These costs can range from a minimum of ten thousand dollars to hundreds of thousands of dollars for the investor. When discussing the associated price tag for investment remember that no numbers are written in stone and that everything is negotiable. Remember also that the franchise needs you in order to get an influence in the local community – that is why it is important to pick a region where the company does not already have a strong influence established. This will give the company an added incentive to give you a better investment contract.

After the terms have been discussed and agreed upon, then an initial payment is usually required in order to use both the logo of the large chain and its name. This is a legal requirement and can be very costly. However, by purchasing these franchising rights you gain access to the large and expensive marketing campaigns that national companies use to generate capital and customers. This can be a great way for an investor to increase business flow and therefore profits.

Building the actual self storage facility is usually financed through the parent corporation. However, the cost of the construction usually has to be paid back in full though this can usually be stretched out over a number of years and be paid through a profit sharing scheme.

Getting inside self storage franchises can be expensive and complicated if you do not do your research or negotiate the terms properly.