People generally seek out a self storage facility becauase they are drowning in books, clothes or a loved ones belongings that they aren’t ready to let go of yet. But whatever the reason they are looking for one, they entrust you as the business owner to make sure that their property is protected and well taken care of during their absence. You have begun to think of your clients as family, you know most of them by name and their families as well. However, maybe you are beginning to grow tired of the day or day and you’re ready to move onto the next big venture so you wonder, How much is my self storage facility worth? A broker can help you find the answer to that question, but understanding the process is always beneficial to you as an owner. After all, your objective is to receive the maximum value for it, and in order to do that, you must first look at the many variables that come into consideration when looking at the possibility of selling your self storage facility.
In order to show you the different variables, we have taken data from the last decade of all the self storage facilities sold in the United States that met our criteria, and broken it down for your further review in order for you to make a solid decision on the sale of your business.
What is your Self Storage Facility worth?
The value of your self storage facility is correlative to your individual business, the market and what potential buyers are willing to pay. Self storage offer units that can be air conditioned. Or non air conditioned, and can store everything from clothing to a boat. But generally speaking the more services that your business has to offer the higher sales price you are able to ask. So while you are trying to figure out how much your business is worth, here are some questions that should be answered before trying to value the price of your business.
- What are the sales?
- What is the profit?
- What are the growth trends?
- What is driving new sales and is that sustainable?
- What channels do new customers come from and what is the breakdown of each channel?
- What is your market position?
- Is your Location favorable?
- How reliant is the business on the owner?
- What systems and processes are in place to run the business?
What makes a Self Storage Facility worth more?
When a buyer looks at purchasing your business, they are basically looking at their rate of return on their investment. So when will they recover what they have spent on the business? In order to show the prospective buyer that their ROI will be high and their relative risk will be low, you should have the a few key characteristics associated with your self storage facility.
And while it is true that the profit and sales are considered very important aspects when considering to purchase a business, they are not the only factors that can add or decrease value the value of your business. The following characteristics will give your business better value.
- Predictable key drivers of new sales
- Stable or growing traffic from diversified sources
- Established suppliers of inventory with backup suppliers in place
- Traffic stats
- High percentage of repeat visitors and repeat sales
- Clean legal history
- Brand with trademark, copyright or legal concerns
- Documented systems and processes
- Growth potential
What does the average Self Storage Facility sell for?
Looking at the graph, the broken down the data that we analyzed from the last decade, which consisted of businesses that range in the $50 thousand to the $10 million valuation range. And these businesses can sell for as much as billions of dollars or as little as a few thousand. You can clearly see the average of self storage facility sold in the last year in the United States is at 10.26 times earnings, with the average sale price coming in at $671,671. However, to have a clear understanding you also have to look at the median sale at $458,500. All this information is a bit overwhelming without being broken down, so later in this article, we will break down these numbers and give you the information needed to be able to start the selling process.
What is the most frequent deal size?
The most frequently sized deal, to look at when selling your self storage facility, is the valuation range of $0k-$250K. This range has continuously had the most the number of sales, for the last 10 years.. For example in the last 10 years there were a total of 40 self storage facilities sold, and of those 13 were valued at the $500k-$1 million. There is no need to worry if your business does not fall into this category though, there is someone to buy your business and finding the right broker will help.
Is the Self Storage Facility market getting bigger?
It is harder to pinpoint the most frequently sized deal of assisted living facilities because they range from such different prices ranges. But looking at the graph our most frequently sized deal would be the $500-1 Million range. But don’t worry if your business does not fall into this category though, there is someone to buy your business and finding the right broker will help.
And keep in mind there will always be the fluctuations in the market and trends but being able to keep your business stable during those times will give future buyers the assurance that your self storage facility is a good investment and buy.
Are bigger businesses worth more?
Generally speaking, yes, the bigger your business is, the more that is is worth. Take a look at the image below, as there is an increase in revenue, your multiple becomes higher, which helps generate a better return on your personal investment.
What states have the most self storage facility business deals?
Are you wondering where the most deals were made throughout the country, or if your state has a hot market to sell fast? Florida had the largest amount of self storage facilities sold, but don’t become discouraged if you are not in one of the states with a higher number of businesses sold, that doesn’t mean that someone is not looking to start a business venture in your area. Having a broker to help you find a buyer for your self storage facility no matter what state you are in, can help you successfully sell your business.
Why would you sell in the first place?
When deciding to sell your business, it can become an overwhelming and difficult decision. Your reasons will always be different from the business owner next door. Maybe you are wanting someone to cater to your needs instead of catering to theirs, or you are ready to retire. Whatever your reason is, be sure that you have the necessary knowledge and tools to get the value out of your business that you are looking for.
How long will it take to sell your self storage facility?
There is not one set timeline for the sale of any business. The variables of the individual business and terms of the sale will define how long it will take to sell. Do keep in mind that generally speaking, the larger the deal (over $1 million) take longer to sell, over the smaller deal (under $200k) because of the complexity of the business, in addition to the risk of purchasing a company that large for the buyer. And try to remember, that your individual business will always sell at a different pace than other self storage facility, and being patient is an essential part in selling.
What is the process of selling your self storage facility?
Our step by step process will help you become more confident, when you decide to sell your self storage facility. Many business owners forget or overlook essential steps in the selling process and sometimes become confused and lost throughout the process. Doing each and everyone one of these steps will help guide you to the maximum profit of the sale of your business. If you have questions or concerns about your business’ value or the process in itself please contact us and we will be happy to help.
Who will buy your business?
Finding a buyer can be frustrating and feel like a never ending search, but finding one is essential for the sale of your business. Tuck that frustration and fear aside because there are many options and possibilities. Buyers can range from first time buyers, experienced entrepreneurs, or private equity companies. No matter what the size or maturity of your business there is a buyer for your business, and we can help you find them.
After reading this article and understanding the necessary steps and processes that come along with the sale of your self storage facility, and you’ve decided that selling your business is the right decision, we encourage you to have your self storage facility valuated by a professional broker, this will ensure that you are receiving maximum value for your business. We understand that your self storage facility is your everything, and we always keep that in mind, when valuing your business. So when trying to answer that question of what is your business worth, comparing it to the business in the next town over, will not get you the exact answers you seek. When you are ready to take the first step, we will be more than happy to help you find the true value of your self storage facility, and can help accelerate the sale, by helping you find the right buyer as well. Feel free to fill out our valuation form and get started right away.