Beyond our Businesses, our communities are also our responsibility
Helen Ng
Chairman, Self Storage Association Asia
CEO, General Storage Company
The headlines these days can make the world seem unpredictable. And yet, self storage is growing in almost all of it. It is important to understand what kind of political and legal environment allows self storage to thrive - and how we, as operators, can play our part. As with much in life, it’s about the basics.
Operators know the 4 Ds traditionally thought to support self storage demand. Our Executive Director, Andrew Work, notes that the four D’s that drive self storage could be summarised in one: Disaster.
The negative drivers of self storage - death, divorce, downsizing and dislocation - are no fun for anyone involved. But they are part of a normally functioning society in the proper measure, not when they occur at runaway levels. Self storage is neither a cause nor a cure for the four D’s. It is a desperately needed coping mechanism. Fortunately, self storage is more and more often demanded for positive drivers like helping entrepreneurs get their businesses started and students to store their belongings so they can go home for the summer and subsequently return to study.
For all of that to work, a certain range of conditions must be met.
The Big Picture has to work
Obviously, a general state of security - a functioning society - is crucial. Fortunately, SSAA members mostly live in stable countries - although one SSAA Board member has been witness to the missiles of belligerents flying back and forth over his relatively stable homeland.
Property rights are so important that no stable civilisation has existed without an articulation of their importance and laws designed to define and enforce them. In our business, it extends from the land we sit on to the property of our customers. Rights must be defined in law first and then in our contracts. They must be defended not only by the authorities and their courts, but also by us, the operators, who are the willing stewards of our customers’ precious goods. We are natural property rights champions.
Sound money is crucial and something most of us take for granted. It is hard to fathom how entrepreneurs in our business have managed to survive in places that have seen their currencies come under assault from their own governments’ policies. But it does impact our members, whether it is delegates considering the cost of attending Expo Asia or their expansion plans when imported steel prices jump in their declining currency. And unsound money inevitably results in high taxes and extreme inflation, a knife in the heart of legitimate business.
Rule of law gives operators confidence when investing in a lease or property purchase that the rules will not shift unpredictably due to a mercurial leader or sudden regime change. Likewise, when we inevitably experience a commercial dispute, we have some recourse to a fair judicial process. Without it, we wouldn’t even get started.
What is our role?
Why does this matter to us, operators, “Store bosses”? When we have the basics in place (and the above are just a few of the preconditions needed to thrive in business), we barely even think about it. We have enough micro-challenges to face day-to-day without having to worry about the big stuff. And what could we do anyways?
That’s where the SSAA comes in. When one of these crucial factors comes under pressure in a way that impacts our business, then we notice. In a big way. Improbable or unworkable regulations coming out of the blue? Taxation imposed on single industries or specific companies? Favouritism masquerading as safety or consumer protection laws? All property rights and rule of law issues.
We take some inspiration from the Self Storage Association in the United States, celebrating their 50th Anniversary this September. They lobby the national government on behalf of members in addition to directly representing members in 23 states where most of the regulatory action impacting self storage happens.
The SSAA has undertaken vigorous government relations to help members when the macro conditions that allow us to serve the public are threatened. Again, it’s normally only valued when the crisis comes and operators notice. But the SSAA rallies the community to face our challenges together.
Members do their part
To circle back to the ultra-basic of a functioning society, we also have to consider the plight of the worst off in our communities, the canary in the coal mine, indicating the health of our broader society. Our members’ ESG programmes oftentimes support the worst off to elevate them directly or indirectly by supporting the charities that provide help to the disadvantaged. This is probably one of the easiest things we can do as a small support for a functioning society outside the doors of our facilities.
Investors at a macro level will include factors like the rule of law, property rights and sound money in their prospectuses and, where money is nimble, withdraw it quickly when those fundamentals are threatened. If those factors are degraded in our jurisdictions, we can forget about attracting investment. As we deal with the micro issues that demand our immediate attention, operators should keep an eye on the big picture. We must consider what we can do, even in a small way, to support the fundamentals of a sound society that keep our businesses vibrant and expanding.
Our businesses are our businesses, but our communities, cities and nations are also an integral part of our lives, our future and the success of our staff, our customers, our neighbours and our families. By all means, keep your focus on the details, but don’t forget we have roles to play to ensure the big picture works for everyone.
