Designing a Better Way to Manage Auctions in Self-Storage

Overview

Industry Context

Self-storage provides secure rental units for personal and business use, typically on a flexible month-to-month basis. Facilities range from small local operators to large enterprises managing thousands of units. The U.S. is the largest market, valued at over USD 59 billion in 2024, with steady growth projected over the next decade. Demand is also expanding internationally.

Product

Our platform is a self-storage management application used by owners, managers, on-site staff, and support teams. It supports the full operational workflow, including tenant move-ins and move-outs, payments, delinquency handling, auctions, reporting, and configurable business settings. It serves both single-facility operators and large enterprises with extensive portfolios.

About Storage Auctions

Storage auctions occur when a tenant fails to pay rent for an extended period. After required legal notices, the facility can sell the unit’s contents to recover unpaid rent and free the unit for new rentals.

While not frequent, auctions are an essential process for operators. They recover lost revenue, clear space, and keep operations moving. Causes include non-payment, abandonment, or legal disputes. For businesses renting units for inventory or equipment, auctions can mean significant, unexpected losses if payments lapse.

Problems and Challenges

We had no dedicated module to manage auctions, so the process was handled manually. This led to:

1. Delays in sending required notices, risking legal non-compliance

2. No clear tracking of communication stages

3. Errors in financial records from manual ledger entries

4. Difficulty moving tenants out and managing late response

5. Multiple disconnected workarounds and scattered documentation

Auctions were rare events, so we gave them low priority and users handled them manually. One reason we avoided building a dedicated module was the complexity because the process touched nearly every major flow in the system and required careful coordination across modules.

However, even small errors during manual handling had a big impact. Minor ledger mistakes could cause significant issues in financial data, leading to time-consuming tracking and corrections. Users also had to store auction details separately or rely on workarounds, making the process cumbersome.

After repeated requests and complaints and with a relatively free sprint available, we decided it was time to address the problem.

Mapping the Auction Process

We started with a detailed breakdown of how auctions were handled in real life. This meant documenting every step, how each role communicated, and what actions occurred at each stage. Roles included the owner, tenant, auctioneer, and bidder.

The mapping revealed how interconnected the process was and where delays, missed notifications, or errors could occur.

(See the Swimlane diagram below.)

Defining Rules and Compliance

Discussions with stakeholders and a review of eviction procedures showed that a single fixed rule would not work. Laws differ by state, and businesses follow unique timelines. For example, one facility might require a 30-day notice, while another acts sooner or sends multiple reminders.

We structured the auction process to be fully configurable within our existing settings system. Owners can define notification periods, auction scheduling, and tenant communication preferences and ensure compliance while matching their operational style.

Understanding and Structuring the Auction Process

We started by mapping the auction process from start to finish, including all possible scenarios like late payments, cancellations, and last-minute settlements. This made sure no step was missed and everyone’s role and actions were clear.

We also looked at how each step affected other parts of the system, such as managing tenants, units, payments, reports, and notifications. Since a single auction could trigger changes in many areas, these needed to work together smoothly.

To keep things simple, we broke the process into three stages:

1. Pre-Auction – When a tenant becomes delinquent and the unit becomes eligible for auction.

2. Auction – Running the auction and managing any payments or exceptions.

3. Post-Auction – Updating records, moving the tenant out, and preparing the unit for the next customer.

   
   

This structure made it easier to design solutions, manage exceptions, and keep everything accurate.

Setting Up Configurations

We integrated auction settings into the delinquency module, making it a natural extension of the process. This integration allows owners to set trigger conditions based on overdue payments, automate reminders and notifications, and configure post-auction actions, such as canceling insurance or blocking payments.

Delinquency is already one of the most complex areas in our system, with extensive rules and calculations. Integrating auctions into it required careful handling to avoid adding unnecessary complexity.