Looking into a Mailboxes-type store or building a self-storage facility

[CascadeStar]

Hello all,

I have been looking into a couple of business ideas that are relatively low risk and also low maintenance:

1) A Mailboxes, Etc- type of store.

2) Buying empty land and building self-storage units on the land.

In the first option, the capital outlay is very low. There is an existing independent mailboxes/shipping service store whose owner is looking for a partner who is willing to invest some cash into the business.

In the second option, the capital expenditures will be very high. I do have the capital to support this and the market demand for this type of service appears to be very high within the Seattle metropolitan area where I'm located.

Could someone provide some insight as to which option would be better in the long run? I am leaning towards the mailboxes store due to the minimal capital outlay and also because I am not sure if I am cut out for the 24/7 attention that a self-storage facility may require. On the other hand, I could leverage the self-storage property to offer additional services such as mailboxes, meeting rooms, etc. Any thoughts and advice would be appreciated. Thank you!

[onetruth7797]

i have always been very interested in self storage units, unfornately I don't have the capital. I have a friend who owns one and you may need "24/7" attention but it's actually very easy to manage. It's safe and the profit is consisent and low risk, also very easy to manage. Only downside is people not paying their rent but than you get to auction off their stuff! So that gets my vote

[rogercbryan]

If you have the money go with option 2. They are very profitable and can recapitalize the initial investment in under five years.

[ndawson293]

Would it be possible to rent the land for option 2 so you won't require a large deposit, potentially lowering the capital?

[Bscivolette]

Both of those markets are highly competitive. For mailbox stores, the UPS Store and FedEx Office (eg Kinkos) have a pretty tight hold on the market. As a secondary, Staples, Office Depot and the like also have shipping centers. I feel as though it would only succeed if you can offer lower prices or if you reside in an area where these stores are less prevalent.

As for self storage, this is another tough market. With the influx of mobile storage the self storage industry loses more and more of their core residential customers who choose the mobile option. There is still a market, but once again it is highly competitive and your initial start up costs may be too much to recoup within 24-36 months.

[onetruth7797]

i'm saving up for storage units. a lot of people don't think about this, but owning a adult family home i do, they baby boomers are hitting 60-70 right now and being a little older a lot of them want to keep their things, hence, renting storage units. So I think, don't quote me, but they will be in demand for quite a few years.

[CascadeStar]

Thanks for all your advice, folks. I have learned quite a bit and I have decided to pursue the mailbox business for the time being. I was able to locate a mailbox business for sale at a very low cost and I'll start with that.

I'll continue to look for opportunities in the self-storage business. My idea is to combine the mailboxes and self-storage business (let's face it - mailboxes are another type of self-storage!) into a single integrated business and maybe start a franchise using that template.