Reading time: 4 minutes

The self-storage industry in Australia has boomed since the first Kennards opened in 1973. Now, more than 1,000 self-storage sites are scattered across Australia. More and more Australians are using these sites to store excess personal property or office furniture, particularly since the current boom in apartment living is fuelling stronger demand for self-storage. If you are looking to take advantage of this trend by opening a self-storage company, make sure you consider some key legal issues first.

Business Structure

The storage business is becoming an increasingly competitive market. The supply of storage units in Australia forecast to increase by at least 10 percent in under two years. So it is important you set up your storage business correctly from the start to give yourself the best chance of success.

Do you want to operate your business in partnership with your spouse or close friend? Or would you prefer setting up a company so that you’re not personally liable for business debts?

Remember that tax and accounting factors influence business structuring decisions, so it is best to seek legal and financial advice before deciding on which business structure is most suitable for your circumstances.

Premises

Finding the right premises when you are opening a self-storage company is essential. You will need a place that has enough space to house multiple storage units and is easily accessible from the road by car or truck. Traditionally, self-storage operations have operated out of converted warehouses. However, there has been an increase over the last year in startup self-storage companies building purpose-built facilities. These facilities provide a better, more customised experience for storers, which means you can charge higher rental rates.

Choose which option is right for you, based on your available capital and desired way of working. You can increase your number of potential customers by locating your storage site near suburbs with a large population or high density of apartments.

Once you find your ideal space, you may need to apply for council permissions, such as development approval. You will also need a building permit and approval of your renovation plans to conduct any building work, plus certification once work is complete. Check the Australian Business Licence and Information Service or contact your local council to identify what business licences you may need and how to apply. A lawyer can help you with your licence applications to ensure the best chance of approval. The application process can be time-consuming and costly, so make sure you conduct careful research and allow plenty of time to acquire any consent.

Contracts

Before you open, you should have a services agreement prepared for customers who want to use your storage facilities. This contract should detail the terms and conditions of the customer’s use of the space, including:

  • length of rental;
  • payment terms;
  • customer expectations (e.g. confidentiality); and
  • any waivers of liability.

You may also choose to conduct a background or credit check of the customer as a term of the agreement. Having a written services agreement in place can minimise the risk of legal disputes in the future. It is best to get a lawyer to draft these contracts, so you understand your rights and obligations. They can also tailor the contract to your business’ advantage, and include disclaimer clauses to limit your liability in certain circumstances.

Security

You will need to decide on the type of security services, if any, you will provide to your storage units. This may vary depending on the type of unit, from locker box to mini-warehouse. There are a number of questions you should ask yourself, such as:

  • will your keys be traditional or digital;
  • will you provide CCTV surveillance and alarmed storage units or buildings at your storage site;
  • do your self-storage premises have PIN-controlled security gate access; and
  • will there be a manager or security guard on-site?

All of these features will require a considerable financial investment. However, they will also make your storage company a more attractive proposition for potential customers worried about their possessions.

Key Takeaways

Careful planning when opening a self-storage company will go a long way. Obtain legal and financial advice when deciding on a business structure and setting up your contracts. Work within your budget when establishing your storage units and security.

If you need help navigating the complex path of opening a self-storage company, contact LegalVision’s business lawyers on 1300 544 755 or fill out the form on this page.

Webinars

Redundancies and Restructuring: Understanding Your Employer Obligations

Thursday 7 July | 11:00 - 11:45am

Online
If you plan on making a role redundant, it is crucial that you understand your employer obligations. Our free webinar will explain.
Register Now

How to Sponsor Foreign Workers For Your Tech Business

Wednesday 13 July | 11:00 - 11:45am

Online
Need web3 talent for your tech business? Consider sponsoring workers from overseas. Join our free webinar to learn more.
Register Now

Advertising 101: Social Media, Influencers and the Law

Thursday 21 July | 11:00 - 11:45am

Online
Learn how to promote your business on social media without breaking the law. Register for our free webinar today.
Register Now

Structuring for Certainty in Uncertain Times

Tuesday 26 July | 12:00 - 12:45pm

Online
Learn how to structure to weather storm and ensure you can take advantage of the “green shoots” opportunities arising on the other side of a recession.
Register Now

Playing for the Prize: How to Run Trade Promotions

Thursday 28 July | 11:00 - 11:45am

Online
Running a promotion with a prize? Your business has specific trade promotion obligations. Join our free webinar to learn more.
Register Now

Web3 Essentials: Understanding SAFT Agreements

Tuesday 2 August | 11:00 - 11:45am

Online
Learn how SAFT Agreements can help your Web3 business when raising capital. Register today for our free webinar.
Register Now

Understanding Your Annual Franchise Update Obligations

Wednesday 3 August | 11:00 - 11:45am

Online
Franchisors must meet annual reporting obligations each October. Understand your legal requirements by registering for our free webinar today.
Register Now

Legal Essentials for Product Manufacturers

Thursday 11 August | 11:00 - 11:45am

Online
As a product manufacturer, do you know your legal obligations if there is a product recall? Join our free webinar to learn more.
Register Now

About LegalVision: LegalVision is a commercial law firm that provides businesses with affordable and ongoing legal assistance through our industry-first membership.

By becoming a member, you'll have an experienced legal team ready to answer your questions, draft and review your contracts, and resolve your disputes. All the legal assistance your business needs, for a low monthly fee.

Learn more about our membership

Need Legal Help? Submit an Enquiry

If you would like to get in touch with our team and learn more about how our membership can help your business, fill out the form below.

Our Awards

  • 2020 Innovation Award 2020 Excellence in Technology & Innovation Finalist – Australasian Law Awards
  • 2020 Employer of Choice Award 2020 Employer of Choice Winner – Australasian Lawyer
  • 2020 Financial Times Award 2021 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review
  • 2021 Law Firm of the Year Award 2021 Law Firm of the Year - Australasian Law Awards
  • 2022 Law Firm of the Year Winner 2022 Law Firm of the Year - Australasian Law Awards