In tough economic times it can be very difficult trying to figure out how to make ends meet. With unemployment still hovering just under 10 percent and five state higher than 11, there are many people which have tried becoming entrepreneurs in order to make a living. However, according to the Small Business Administration at least one third of all new business fail within the first two years and over half of them by four years.
Since success is so hard to come by, how do you know what kind of business to get into when you are starting your own?
Besides considering something that you are good at and will enjoy one should consider the stability of the industry as an indicator of the likelihood of sustainability and success. According to recent reports, the self storage industry appears to be one of the best and safest ones to invest in.
A report done by First Research says that there are approximately 9,000 self storage companies in the United State. On an annual basis they bring in revenue in the amount of $6 billion. That equates to revenue of close to $700,000 per company. With about 90 percent of self storage companies operating only one facility, that makes for a pretty good profit margin!
Now just like every industry, there are a few that dominates the self storage industry and account for a disproportionate amount of the total revenue. Fifty of the major companies including REITs (real estate investment trusts) like Extra Space Storage, Public Storage, Sovran, and U-Store-It are responsible for about 40 percent of revenue generated in the self storage industry,
The trick for the new company with few or just one facility is figuring out how to stand out against the back drop of the large companies and not just survive, but thrive. Larger companies have the benefit of being able to lower the individual expenses of facilities by sharing the cost across all their facilities making it easier for them to lower their prices and still operate at a substantial profit.
In an industry that is doing well like the self storage one is small, new companies can survive; you just have to prepare appropriately. The most important factor is in your location. The right one and you will never be without a good supply of customers, but the wrong one will force people to have to try to find you. If they have to try too hard they are just as likely to pick someone else.