The tale of Cedar Storage a really good idea

In 2004 two industrious young men working on several projects needed some extra space for their machines and tools. After looking around the neighborhood for several weeks they found a storage unit with a company who shall remain nameless. The young Entrepreneur started to pay exorbitant rates for this small unit which had only wire and roof sheeting to separate them from their neighbors in the complex.

It was not long before the Scotsman complained with regards to the cost of the unit. Between these two industrious entrepreneurs the noticed a gap in the market for good quality storage. After many months of enterprising research into this market in SA it was decided to take the next step. They then decided to start learning all about this hidden money machine called self storage. The one focused on how to design the buildings and configurations of these complexes in many countries while the scot got busy understanding the money. These two bright boys thought they were so clever and got some financial backing from the United Kingdom from a small investment company who believed in the product and came here to teach them some new tricks in working with larger projects and OPM (other people’s money). Like any strong willed pair of men they surged forward and put the idea into action. This was around 2006 when the housing boom in SA was at its peak (mistake No1). The plan was simple, design and market the complex of self storage units in an area recognized to have the highest demand for them.

The plan was launched in 2006 with the aim of selling 30% of plan before starting construction. This was easier than expected and 300 units were sold including the securing deposits. This took less than 90 day’s to accomplish. The team then took the sold units to the bank to have the bonds approved, without any thought that a financial institution would say no to bonds worth 19 million in sales with a deposit of 6.3 million over ten years. Much to the amazement of the whole team the banks said and I quote “why would we want to register 300 bonds for so little money”. Cap in hand these adventurous young men handed all that money back to some very disappointed people who were expecting to be the first to invest in sectional title self storage in SA. Later it was discovered that some BIG boss in the banking world had said that the bonds were not worth their time.

The project was shelved and the English money disappeared back to UK with the investors as they now became a bit scared when the tell-tale signs of the 2008 crash started to show its ugly head. No money and no reasonable opportunity in sight the two had to sit and hold tight for the ride of their lives.

During another phase of inactivity a very generous investor started to invest with the entrepreneur who had other projects in the pipeline but due to the 2008-2009 world economic crash that also dried up but there were debts to be paid. In order to salvage some respectability it was decided that the best project would be sold off to the benevolent investor to cover the debts. Part of the deal was that the entropernuer would be sold off with the project to assist with getting it started and a small reward.

A new beginning, September 09 2009 final go ahead was given and construction started. It was agreed to do a proof of concept and proof of business plan 1st. the new team would erect 152 units with offices and all infrastructure to operate this small complex. With much head scratching and running around looking to get the cheapest materials and labor ground was broken and pencil drawings were made.

By the end of December 2009 the team had constructed all the shells and finished most of the ground work ready for the new-year.
January 2010 everybody returned from the break with new enthusiasm and ideas. With everybody working extremely hard and not always smart the roofing went on with the doors and all was happening at such a rate that the work was completed 2 months ahead of schedule. Now the benevolent benefactor wanted to see the money stream the scots-man had projected. The team was now left with the challenge of selling these units even though there was no real plan on how to manage the tenants. Well there was but it proved to be a nightmare all the same.

From a simple spreadsheet and a board on a wall, we start renting units from 1st May 2010. The gates weren’t quite complete the cameras were a still fuzzy. The Scot always said “you build them they will come” and boy did they come. In the next 90 days approximately 130 units were occupied and the kind and industrious benefactor said let’s build more.

There were large amounts of blood sweat and many hours of head scratching when the final new design units were started in March 2011. With the impetus on the new buildings being better than the 1st phase of development a new breed of storage unit was born. The double story unit. This has enabled the company to keep running costs down and increase the income without charging the clients a fortune.

The dramatic new design had all the skeptic’s doing what they do best “that will never work”. However once people got used to the idea that when you need less space you can get a cheaper one upstairs that is just as functional. The team continued to make record sales which drove the builders and site workers very busy from early morning till dark every day. The whole team was proud of their efforts to fill these units by the end of 2011.

During a lull in building and selling and not because people stopped needing self storage by any means, quite the opposite to be true as the sales team kept reminding us. The need for a local storage software program became apparent as the complex now housed some 425 people’s goods. The team put together a list of demands of what this program must do and we set to work on developing it. We now call her Store-Pro. Having noticed the need for a fully functional storage software management program and armed with a list of demands from the floor the software went live on the 1st February 2012. This was a major milestone reached by the Cedar Storage team.

Now armed with full control of each unit in the complex the building and selling could go ahead full steam. The next phase saw old drawings being taken out and redrawn and rehashed to improve efficiency even more. Again our magnanimous leader said yes build and we did. By the end of 2012 we had built 660 units ready for occupation. The sales team and marketing alike rose the challenge as expected and they were filled to capacity.

In the year 2013 all was good at Cedar Storage and the last battle was about to begin. Again the pencils were sharpened and large amounts of recycled paper were used to redesign the units as people started to ask for different sizes. After many talks and discussions the new designs were approved for building. The last phase of the complex started in September with new hope and enthusiasm the Cedar Storage team got to work by the end of November 2013 a total of 794 units were built and a whole new phase of selling and marketing began.

Leave a Reply