Steve Jordan talks to Paul Fahey, a moving man who turned to self storage and found the road to success.
Paul Fahey is part of the third generation of an Irish immigrant family that made their home in Manchester, England. Paul’s grandfather, Patrick, ran a second-hand shop and delivered goods to customers on a simple hand cart. With his sons Peter (Paul’s father), Tony and their younger brother Jimmy, the family built and diversified the business to include property, industrial cleaning, retail and distribution.
On leaving college, Paul was given the job of running the removals side so, at age 18, he found himself the managing director of P. Fahey & Sons, a company with six vans and a good local reputation.
Paul quickly set about diversifying further. “I realised that the commercial moving market was more lucrative than the house moving,” he said, “and we worked hard to secure a leading share of the office moving business in Manchester at that time.” The Irish connection also gave the company a niche which grew into a three-times-a-week consolidation service from the UK to Ireland with an office in Dublin and agents throughout the country. Building on a winning formula, Paul expanded again into Spain with a weekly service and an office on the Costa Brava.
Right from the early days of his career, Paul was an enthusiastic supporter of the British Association of Removers (BAR). He became chairman of his local area and served on the National Council. He also became a director of BAR Services, the company set up specifically to provide high-quality materials and equipment to the industry. “BAR was very valuable in making friends and contacts in the industry,” said Paul. “It’s where I realised the relationships between people in the sector are very valuable for everybody.” This work was to prove inspirational when, in 1992, everything changed.
In 1992 the Maastricht Treaty created the European Union and the concept of European Citizenship with free movement of people and the right to work within the EU. At a stroke the specialist service provided by companies such as P. Fahey & Sons became less exclusive. Now any company with a van and enough diesel could offer a service throughout Europe. Though the company continued successfully, Paul decided to look for an alternative occupation.
His first move outside the moving sector was to start what became a national chain of large indoor children’s playgrounds called Alphabet Zoo. Between 1992 and 1997 Paul opened 20 playgrounds before selling the company.
He said he came across self storage by accident having been asked to research the sector by a business associate. Over the next few years he was involved in opening a string of portfolios of stores always on the basis of ‘open, fill and sell’. Having filled the stores and created a successful business, he sold to the major companies such as Big Yellow and Safestore. In 2013 he started a new brand, Storage World, now with three locations, which he still owns.
In 2012 Paul became chairman of EasyBox, an Italian self storage company with seven stores, moved out to the country and transformed the business. This he acquired in 2016 and sold to an American investment fund in 2018. He still retains an interest in the business, as do two of his daughters and their husbands.
Drawing on his BAR experience, Paul soon became the chairman of the Self Storage Association (SSA) in the UK and, in 2004, the founding president of FEDESSA, a position he held for three years. He is now on the Board of the Self Storage Association Asia (SSAA). This position at the hub of the industry has given him access to statistics which paint an interesting picture of the industry worldwide. “In 1999 there were 150 self stores in the UK and another 100 elsewhere in Europe,” he said. “I presented to the BAR conference in 2000 and encouraged movers to join the industry as I knew it would grow, most didn’t. So the storage occupancy for many movers went down, taking much of the profit out of the sector.”
Today Paul says there are 4,500 stores in Europe (including 1,400 in the UK) and the market is by no means saturated. “My first visit to the USA was in 2000 to a self storage conference in Denver,” he said. “Then there were 25,000 stores and everyone said the sector was saturated. Today there are 55,000 stores and they are building more every day. Awareness is nowhere near peak in the UK. People just don’t understand how effective, flexible and economic it can be, especially in the provinces where it is still a pioneer market to some degree.”
In mainland Europe, the Netherlands was first to get the self storage bug, then Spain. Germany was one of the last to catch on. Italy is still poorly serviced with only 60 stores for 60m people, though Paul said the real estate market and business environment are difficult there.
I asked Paul what advice he would give to a company wishing to enter the self storage market. He said that it’s not as easy as it once was as banks are less willing to lend and there is more competition. The main form of promotion is web marketing and it’s very hard to compete with the spend and brand awareness of the big companies. Finding the right location is still important and, although the business appears to be simple, owners will need to have a blend of marketing, retail management, and property experience and be experienced at sourcing funding. “In a pioneer market it’s sometimes better to be second than first,” said Paul. “Educating the customer is very difficult and expensive. You can’t spend enough on advertising to do that. A warehouse on a busy road does it better.”
“It’s very cash heavy and you then face potentially two years of losses and a year of break-even before it starts to become a lucrative cash cow,” said Paul. “But, if you have the means, and can afford to wait for a medium-term return, the value of the business becomes considerable and businesses now are selling at up to 20-times profit.”
So, there you have it. The heady days of the pre-crash financial world are behind us and it’s not as easy to get started as it was. That said, Paul is still enthusiastic about the industry and is still investing himself, though now more for the long term than for fast returns. “The competition today is more sophisticated and funding is more difficult,” said Paul. “But it’s a great sector that is still in its infancy. If you are determined, and have the resources, do it!”
There is much talk in moving circles about diversification. Companies are trying their hands at office moving, fine art, document storage, and much more. But self storage still has a way to go and, for those with the resources, could be a route to maximum returns with minimum hassle.
Photos: Paul Fahey; EasyBox store