1. Overpay Just To Buy A Unit
If you're new to the storage auction scene, don't be in any rush to get your first unit. You have to wait for the right unit to come along at the right price. It will happen. I know you're eager to get your feet wet, but the object of the game is to make money. Just be patient and you will find a bargain.
2. Buy A Unit Too Large To Remove Merchandise Within 48 Hours
When you buy a storage unit at auction, you have to have it totally cleaned out and broom swept within 48 hours. A lot of newcomers will purchase a large unit not realizing how much work it is to clean out. Keep in mind that some units contain heavy items like furniture and appliances that require some muscle to move. It is a good idea to have a truck and labor lined up in advance, especially if you plan to buy multiple units.
3. Keep Ego In Check
When you're bidding on a unit, try to keep your emotions in check. Some people who are new in the business are trying to make a name for themselves from the beginning by getting into a bidding war or trying to run others up. If you're going to be a successful buyer, you must know when to let the unit go. If it doesn't make sense, don't buy it. Some new buyers even overbid to let others know that they have money. This isn't a good idea because no matter how much money you have, there will always be someone else with deeper pockets. I personally know a multi-millionaire that attends storage auctions just for fun.
4. Bid To Find Hidden Treasures
This is a common mistake newcomers make. They've seen the storage auction reality shows and they think there is an expensive item hidden inside every unit. Well, I have news for them. Most units contain common household items, appliances and furniture. If they pay hundreds or thousands more for a unit on the hope that the unit contains hidden treasure, they won't be in this business for long.
5. Not Having A Resale Strategy
Some new buyers buy a unit without having a plan to sell the contents. Possible outlets are garage sales, setting up a booth at a flea market or selling the items online. Either way, it's a lot of work. The key to making a profit in this business is turning over your inventory as soon as you can. Unless you have an unlimited supply of cash, you will need get your money back quickly, so you can reinvest it in more storage units.
6. Not Enough Cash On Hand
If you have a good amount of cash, by all means bring it. Nothing hurts worse than missing out on a great unit because you didn't bring enough money with you. Remember, most auctioneers will not allow you to go to the ATM after the auction is over, so if you don't have enough cash in your pocket, do not bid on the unit.
7. Buy Junk Storage Units
A junk unit can put a bad taste in your mouth for the storage auction business. If the unit looks like it contains a lot of trash or worthless items, it is a good idea to avoid it. It takes a lot of time and energy to clean out a unit, especially ones that are unorganized and contain a lot of trash. Focus on units that are fairly organized and show signs of quality merchandise.
8. Did Not Clean Out Unit Entirely
Some newcomers buy a unit that they are unprepared to move. They start their excavation only to realize that the unit isn't what they thought is was. If the unit contains a lot of unsellable items and trash, you might feel like giving up and just leaving the bad stuff behind. This is one of the easiest ways of getting banned from future auctions. Even if the unit turns out to be a complete bust, you have to dispose of it properly. The contents of the unit must be completely removed and the unit needs to be broom swept. Most storage facilities will not allow you to use their dumpsters so I recommend that you locate a dump in your area. Believe me when I say you will need it.
9. Did Not Bring Necessary Supplies
I see a lot of newcomers who don't even have a flashlight with them. Most storage units do not have lights in them and it can be quite difficult to see the contents. If you don't already have one, make sure you invest in a rechargeable flashlight. The other essential is having multiple padlocks on your person. At my buying peak, I usually kept at least three locks on my belt loop and another 7-10 locks in my vehicle. Tip: Buy padlocks that are keyed the same or color code your locks and keys. Nothing is more frustrating than trying to locate the right key for the lock while the auctioneer is moving on to the next unit.
10. Stereotyping Storage Facilities Based Upon The Area
Some people try to profile an auction based upon the area that the storage facility is located in. Let me start off by saying that some of the best units I have ever bought were in rough neighborhoods and I got the units dirt cheap. If you only attend auctions in nice areas, you will be missing out on some great bargains.
Do you know of any other common mistakes newcomers make at storage auctions?
If you would like to add them to this list, please leave your interesting and creative responses in the comments section below.
15 CommentsLeave a comment
Most newbies dont think things through all the way.. which is the main problem. I’d advise newbies to do some research for a few months on storage auctions before they start getting into the nitty gritty.
As a former tenant of self-service storage, I can provide one other reason that your point about not judging a facility by its neighborhood is valid: Some people who live in a nice area find that all the units near them in their desired size/price range are taken! There’s a facility within a mile of our Dallas home that regularly puts up banners indicating they have units for rent, but when called, always says everything’s been taken already. We ended up having to rent miles away just to avoid paying an arm and a leg. While there are many neighborhoods where I personally wouldn’t have rented, when we first moved back here several years ago, we had to have my mom check out places while we were already en route from North Carolina, and it would have been very possible for us to end up without viable alternatives to renting in a less-savory area. (When we finally did buy a house FOUR YEARS LATER and took my husband’s cousin to help us load up our stuff, he very helpfully pointed out that the cost of $169/month for 48 months would’ve made a nice start on the down payment… yeah, Santos, we never thought of that …)
Thank you for writing this article and including the part about keeping your emotions in check. Many bidders over pay for units or bid up the price of the unit just because they are emotionally tied to winning or because someone they don’t get along with/find annoying is bidding. I always recommend determining a maximum that the unit is worth and sticking to that maximum no matter who is bidding.
Great information, thanks again!
This is the definitive list of mistakes. The “not having an exit strategy” is probably a big one for newbies – selling the stuff is more than half the work. Nobody thinks about that side.
Thanks for the comment. I have noticed your website on a few occasions. The first occasion was when I was searching for storage facilities in the Dallas Fort Worth area in the online yellow pages. Correct me if I’m wrong, but it appears that your company gets a referral fee if you direct a new customer to a storage facility and they rent from them?
I noticed that you created hundreds of duplicate listings for storage facilities in the DFW area that included your phone number and your URL. Now, I’m not trying to bash on you, but I would like to let you know that what you did made locating a storage facility’s phone number in the yellow pages extremely difficult. I understand that this is probably a good source of revenue for you business, but it really causes a lot of problems for other people.
I also noticed that you are claiming to provide storage auction schedules as well. I visited you website looking for this auction list and I was bombarded with storage facility rental ads. I did see a few auctions listed for 4-5 months in advance but nothing current. I think we both now that you are just trying to get traffic to your website and I’m all for internet marketing, I just feel like you’re giving people the bait and switch. Surely there are more appropriate ways of getting people to visit your website besides tricking them. I welcome your response.
I have been too two taping of SW Dallas and have the following names of the players. The two big guys are Bubba (the biggest of the two) and Rick, the black guy is Roy Williams (former Cowboys DB,) Vic is the tall skinny guy who I believe is from Jersey or there abouts and the blonde woman is Lisa.
I have been to two of the SW Dallas tapings. The first had Jackie Sutton as the auctioneer, this was at Abby Storage on Miltary Parkway a couple weeks ago. Today Walt was the auctioneer, and it appears he was filling in for Jackie. This was at Abrams Skillman Storage. It appears the first names of the buyers are Bubba and Rick (Rickie?) as a team, a lady named Lisa, and a guy named Vic. It also appears that Roy Williams the former Cowboys DB (not the receiver) is also involved but not sure he is a regular, he won a unit at todays auctions.
One of the biggest mistakes I see newbies making is walking around talking loudly about what they paid for a unit, or what the specific contents were hoping to impress someone. Those of us in the business for a long time have learned that keeping our specific finds to our selves helps us get better deals in the long-run.
It is different sharing info online where people are rarely at the same auctions together, but when someone comes up to me at an auction and asks me about a unit I have purchased before, I always just smile and say, every unit I buy is a good one!
Great articles and I’ll check in regularly.
See ya soon,
Love the article… here is what I tell newbies… “If you do not have a method to sell what you buy, you will just end up being a hoarder with a packed garage and your wife will have to park in the driveway.”
I AM FOLLOWING YOUR ADVISE AND COLLECTING INFO……..HOW CAN I GET INFO ON CARGO CONTAINER ,AIRPORT,AND FREIGHT LINE AUCTIONS…….
I AM A SERIOUS PERSON AND SEEKING PROFESSIONAL ADVICE BEFORE GETTING TOO INVOLVED………I AM ALSO DOING THESE SEARCHES FOR “SILENT PARTNERS”…WHOM UNDERSTAND THE PRINCIPALS OF FAST “TURNAROUNDS”..AND CASH BUSINESS………
We do cover shipping container auctions, moving and storage auctions and RV and boat storage auctions; However, these auctions occur less frequently that storage unit auctions because these places let their inventory build up and then they have one large sale.
The portable storage container companies like PODS, U-Box and 1-800-Packrat usually have monthly auctions. These types of auctions can be great to attend because a good amount of the units contain an entire household of items.
We do not currently cover unclaimed baggage auctions, although, who knows what the future holds.
This is a pretty interesting website. I am planning a new store opening in April 2013. I would like some products bought at auction as well as new items purchased through wholesalers and manufacturers. I have been in and out of sales most my life and finally built up a nest egg large enough to jump into the being a store owner. I can last roughly 2yrs without sales and just paying employees. I figure thats enough. lol Well, now i have started bargain shopping and need to get all my ducks in a row. Do you have advice on merchandise? I have already picked out a high traffic store location and I feel comfortable that the space is more than enough.
Although I have never operated a resale store, I can point you in the right direction. Go to our sister website, Storage Auction Forums at StorageAuctionForums.com. Once you register, you can ask this question under the “Stores” category. You will get some good advice here from other storage auction buyers who own and operate resale shops, thrift stores and consignment shops.
Your advice to newbies is invaluable, especially the exit plan. No one seems to have an idea as to where they will sell their newly acquired treasures, then reality kicks in and one ends up as one of your readers illustrated, a hoarder. I used to live in Dallas, Ft Worth and Arlington on different occassions and I miss Texas alot. I now live in New Jersey and am finding it difficult to find storage auctions here. If you have any connections, I would be pleased to hear of them, if you are willing to pass them along. Please E-mail me with any results. Thanking you in advance,
I bought 177 Storage Units last year and 34 so far this year in NJ. I find that it really is comparable with skilled gambling such as poker or blackjack. I have crushed some units and also taken some terribly bad beats. $25 to $7000 and $2000 to $200 are both realities if you play the game on a big scale with auctions. Newbies usually forget to factor full cost including time + labor into the investment. The truck you rent, any time you spend processing is all part of the bid price that just has not been applied yet.