Is it better to develop your own storage business or open a franchise? Both options come with advantages and disadvantages you’ll want to weigh carefully.
The Pros and Cons of Storage Franchises
If you decide to invest in a self-storage franchise, there are some potential downsides to keep in mind:
- You have less control of your business: The brand you’re investing in and the contract you sign can dictate everything from how your units look to the services you offer to the marketing you do. You also don’t get to choose who you work with — the brand decides on suppliers and partners. With your own self-storage facility, you get to call the shots.
- It can cost more than starting your own business: Startup costs go beyond purchasing self-storage units when you open a franchise. You also need to pay the brand and get the facility up to its standards. With your own self-storage facility, you can keep initial costs low and start profiting faster.
- If you ever sell, you’ll earn less: If you set up an independent business from scratch, you will likely make a bigger profit when and if you sell. Investors may see more potential in an independent business than in a franchise with specific rules.
Of course, some investors choose franchises for good reason. They do come with benefits:
- Brand awareness is already in place: Potential customers may recognize and trust a specific self-storage brand, especially if they’ve rented a unit from another franchise location before and had a good experience.
- Brands provide valuable mentorship: Brands want your self-storage facility to succeed, so they may provide training, tips, mentorship and events for you to take advantage of.
- Selling can be easier: An independent business may earn you more when it’s time to sell, but other investors are always looking for franchise opportunities. Selling a well-performing storage facility under a respected name can get you offers quickly.
Do You Want the Best of Both Worlds?
If you want some of the benefits of buying a franchise with the advantages of owning your own storage facility, work with Investment Real Estate (IRE). We make it easy to browse listings when you want to buy or sell properties. We also offer educational resources and services to help you with management, building your own facility and more. If you’re ready to start realizing a great ROI, contact Investment Real Estate today.