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STORAGE BY THE BIN: A NEW BUSINESS MODEL FOR SELF STORAGE

The self storage industry first had its big break in the early 1970s, but in the intervening decades its basic model has remained largely unchanged:

A facility provides individual units to each of its customers on a property that’s overseen by a small staff. That his been, almost universally, the leading business model.

Recently, however, a few startups have begun to reshape the very definition of self storage by taking control of all the steps in the process, from moving in to retrieval.

THE STANDARD BUSINESS MODEL FOR SELF STORAGE

In the storage by the bin model, customers fill bins provided by the company and then the bins are shipped off to a warehouse for safekeeping.

The tenants don’t visit their storage unit — they don’t even have a traditional storage unit. But they don’t need to visit. They can simply put in a request and the storage company will deliver their requested bin(s) back home.

ENTER STORAGE BY THE BIN

MakeSpace, Clutter, and Storrage are pioneering storage by the bin in a number of cities around the U.S.

MakeSpace, in New York, takes pictures of the items to be stored before carting them to their warehouse, and Clutter, in Los Angeles, asks its customers to do the same using their app.

The trend has even made its way to the United Kingdom, with London’s WeStore entering the fray.

COMPANIES BEHIND THE NEW MODEL

Boxbee, in San Francisco, has perhaps taken the biggest strides by making their delivery services the physical equivelant to digital cloud storage.

Bins aren’t for one person anymore. Now friends and family can also request deliveries and use your items while you aren’t.

“Cloud storage is such a great idea, but it needs to extend beyond the world of software and apply to people’s physical things,” says Boxbee CEO Kristoph Matthews.

COMPANIES BEHIND THE NEW MODEL

“Our vision for the future is that your home finally becomes the place where you just keep the things you love and need every day. All of the other things you only need one occasion, you keep somewhere else, and just order it when you need it.” - Boxbee CEO Kristoph Matthews.

It’s a grand vision, and we’ll have to wait a while to see how successful these kinds of companies will be. Nonetheless, the first question the savvy business owner will ask is, “How can I get involved?”

If you find a budding storage by the bin service in your emerging area, contact them and figure out what you can do to be a part of this new trend. Let’s look at some ideas for getting started.

CLOUD STORAGE FOR PHYSICAL BELONGINGS

Here are some ways your facility might be able to get involved:

Rent warehouse space. Most of these companies use commercial warehouses to store their customers’ belongings. As they grow, they’ll need more space, and space is one thing your storage facility has. If you have large warehouse-size spaces, you could very well have some indispensable real estate, enabling you to partner with these storage by the bin companies.

Rent a truck. Not all of these companies own their own vehicles. Many pay for third-party courier systems. If you have a truck that you usually rent to tenants, you might have just found yourself another customer.

HOW TO GET INVOVLED

Franchise. Many of these companies are small and relatively new, so it might not be as hard as you think to get in on the ground floor. Seattle’s Storrage in particular has expressed interest in franchising and most of the companies are no doubt looking to expand beyond their initial location.

Partner with the company. Find some other way to partner, like a joint advertising campaign or a mutually beneficial referral system. Many small companies will take whatever exposure they can get, so don’t be afraid to go out on a limb and ask to work together.

HOW TO GET INVOVLED

Not everyone is located in the same city as one of these developing companies and some of them might simply not be open to partnering. If that’s the case, there are still a number of ways to implement the innovative ideas these companies are developing.

Two such ideas are mobile storage and postal deliveries.

OTHER INNOVATIVE SOLUTIONS

Mobile storage pods are units that are brought to the renter’s home, filled, and then returned to the facility. This is similar to the storage by the bin feature that’s on the rise, but it’s also only half the equation.

A huge part of the appeal of this new wave of companies is the ability to have items in storage delivered back to the renter. Perhaps this is a feature many more storage facilities will begin to incorporate.

Of course, the existing infrastructure will have to change somewhat. At most storage facilities, the tentant seals their unit with a lock that only they have access to. In order to deliver items back to the renter, the facility manager would also need access to the unit.

MOBILE STORAGE

Another innovative solution is to accept postal deliveries. Companies like Kinek are working to increase the number of storage facilities in the nation that accept postal deliveries.

This is a convenient feature that doesn’t involve a lot of work from the manager and staff but allows renters to pick up their packages at their leisure, offering a ton of convenience for a small amount of effort.

Once again, accepting postal deliveries is still a step away from the storage by the bin model, in which a renter’s delivery could be stored directly with their other belongings without the renter needing to make any trips, but it’s a step in the same direction.

POSTAL DELIVERIES

It’s hard to say at this point how far storage by the bin will go. Even the largest companies are still small.

Boxbee, which won the LAUNCH Festival Start-Up of the Year Award in 2013, has already stored more than 4,100 items in its short history.

There seems to be a lot of upside to the increasingly popular business model, especially in urban areas where space is scarce and people are always on the go.

But there will always be a place for traditional storage.

WHERE DOES THIS LEAVE TRADITIONAL STORAGE?

Many customers take great comfort in knowing that they are the only ones with access to their unit, a security measure that is impossible in the storage by the bin model.

Another benefit of traditional storage is the pricing. If you only want to store a few boxes’ worth of stuff, paying for the boxes individually might be cheaper than renting a 5’x5’, which is usually the smallest unit available at a conventional storage facility.

On the other hand, a customer wishing to store a whole home’s worth of items would need a lot more than a few boxes, and a single large unit at a traditional facility will probably be cheaper than the equivalent amount of boxes at a storage by the bin facility.

THE ADVANTAGES OF TRADITIONAL STORAGE

With cloud storage becoming more and more popular online, it’s not unreasonable to see the same happening with our physical belongings.

Boxbee’s CEO Matthews has that exact vision. “Imagine the not-too-distant figure where we have a feature in the interface where someone can browse what kinds of objects their friends have in storage, and they can have that delivered to their house and sent back, like a lending library,” Matthews says. “It turns storage into something that is not just a poor excuse to hold onto your stuff, but a dynamic thing that is useful to a lot of people.”

WHAT TRADITIONAL STORAGE FACILITIES CAN LEARN

While many would argue traditional storage is not a poor excuse, the smart facility owners know that there is always room for improvement. With the rise in smartphones and cloud storage, it seems inevitable that these storage by the bin services will begin to take off.

While it is doubtful that storage by the bin will supplant traditional storage entirely, it is becoming more imperative to think outside the box, move forward in the wake of modern technology, and never simply sit back and expect the industry to lie still.

Now is your opportunity to continue putting your customers first by finding new ways to reach out to them.

WHAT TRADITIONAL STORAGE FACILITIES CAN LEARN

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