Extra Space Storage Business Model Canvas

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Covers customer segments, channels, and value propositions in full detail.

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Clean and concise layout ready for boardrooms or teams. Extra Space Storage's model simplifies complex strategies.

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Business Model Canvas

The Business Model Canvas you see here is exactly what you'll receive after purchase, a complete, editable file. This isn't a demo; it's the actual document ready for your use. After buying, you get this same ready-to-use template in all its comprehensive detail. No hidden sections, just full access to the Extra Space Storage business model.

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Business Model Canvas Template

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Extra Space Storage: Business Model Unpacked

See how the pieces fit together in Extra Space Storage’s business model. This detailed, editable canvas highlights the company’s customer segments, key partnerships, revenue strategies, and more. Download the full version to accelerate your own business thinking.

Partnerships

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Real Estate Developers

Extra Space Storage teams up with real estate developers to grow in important areas. These collaborations help build new stores and acquire existing ones, boosting its storage portfolio. Partnering with developers gives Extra Space access to great locations, speeding up its expansion. In 2024, such partnerships fueled significant growth, with about 100 new stores added through development deals.

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Third-Party Management Clients

Extra Space Storage's third-party management platform is extensive, overseeing facilities for independent owners. These partnerships generate management fees, boosting revenue without major capital outlay. ManagementPlus, their core technology solution, optimizes facility operations. In 2024, management revenue contributed significantly to overall income, showcasing the platform's value.

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Insurance Providers

Extra Space Storage collaborates with insurance providers, offering tenant insurance to customers. These partnerships are crucial for protecting stored belongings. In 2024, tenant insurance contributed significantly to ancillary revenues, boosting overall profitability. Extra Space Storage fully reinsures these policies, generating a profitable revenue stream. These collaborations provide customers with insurance options.

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Joint Venture Partners

Extra Space Storage strategically forms joint ventures to fuel its expansion, sharing both capital and risk. This approach allows the company to grow its portfolio efficiently. In 2024, Extra Space allocated $950 million across various investments, including joint ventures. These investments are structured to provide attractive returns.

  • Capital Sharing: Joint ventures reduce the financial burden of individual projects.
  • Risk Mitigation: Partnerships spread the potential downsides of real estate investments.
  • Portfolio Expansion: Facilitates faster growth by leveraging external capital.
  • Investment Strategy: Investments are targeted for attractive yields.
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Moving and Relocation Services

Extra Space Storage partners with moving and relocation services, creating a referral network that boosts customer acquisition. These alliances offer customers a convenient solution for their storage and moving needs. This collaboration expands Extra Space Storage's reach to a wider audience. In 2024, the self-storage industry's revenue reached $48.8 billion, highlighting the importance of strategic partnerships.

  • Referral Network: Boosts customer acquisition.
  • Convenience: Offers combined storage and moving solutions.
  • Wider Reach: Expands customer base.
  • Industry Revenue: $48.8 billion in 2024.
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Extra Space's 2024 Growth: Partnerships Drive Expansion

Extra Space Storage forms partnerships with real estate developers to grow its portfolio, adding about 100 new stores via development deals in 2024.

The company leverages third-party management, boosting revenue and optimizing operations through the ManagementPlus platform, which significantly contributed to overall income in 2024.

Collaborations with insurance providers, and moving services, alongside joint ventures, further expand reach and generate revenue, with the self-storage industry reaching $48.8 billion in 2024.

Partnership Type Benefit 2024 Impact
Real Estate Developers Portfolio Expansion ~100 new stores
Third-Party Management Revenue Generation Significant income contribution
Insurance & Moving Services Customer Acquisition Industry revenue $48.8B

Activities

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Facility Management

Facility management is central to Extra Space Storage's operations, covering security, cleanliness, and customer accessibility. Maintaining high standards directly impacts customer satisfaction and retention rates. In 2024, the company managed over 3,600 facilities. Effective facility management contributes to positive customer reviews and repeat business, a key driver of revenue growth. Extra Space Storage's focus on facility upkeep supports its goal of providing a premium storage experience.

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Property Acquisitions and Development

Extra Space Storage focuses on buying existing storage facilities and building new ones to grow. This strategy boosts their reach and market share. For example, in 2024, they spent $581 million acquiring 58 stores. This expansion is key to their business model.

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Customer Service

Customer service is crucial for Extra Space Storage to keep customers. They assist with rentals and handle customer issues. Extra Space uses AI to help with service automation and sales. In 2024, the self-storage industry's customer satisfaction scores averaged 78 out of 100.

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Marketing and Sales

Marketing and sales are crucial for Extra Space Storage, directly impacting occupancy and revenue. The company uses online advertising, special offers, and partnerships to draw in new clients. In 2024, Extra Space Storage spent $138 million on advertising, with a focus on digital channels. For 2025, they plan to enhance their online presence with features like natural language search and AI-powered chatbots.

  • 2024 Advertising Spend: $138 million
  • Focus: Digital marketing and SEO
  • 2025 Initiatives: Natural language search, AI chatbots
  • Goal: Increase customer acquisition and retention
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Revenue Management

Extra Space Storage's revenue management is critical. They use a proprietary system for pricing, constantly testing and optimizing strategies. These strategies are tailored to each market and unit, updated in real-time. This approach helps maximize revenue.

  • In 2024, Extra Space Storage's same-store revenue growth was around 3.8%.
  • The company's revenue management system is a key driver of this growth.
  • They analyze data on occupancy, rates, and demand to adjust prices dynamically.
  • Extra Space Storage aims to balance occupancy and rental rates to achieve optimal revenue.
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Storage Solutions: Key Activities and 2024 Performance

Extra Space Storage's key activities include maintaining facilities, expanding through acquisitions and new builds, and providing excellent customer service. Marketing and sales efforts, including $138 million in advertising in 2024, drive customer acquisition. Revenue management, employing dynamic pricing, boosted same-store revenue by 3.8% in 2024.

Key Activity Description 2024 Data
Facility Management Ensuring security, cleanliness, and accessibility of over 3,600 facilities. 3,600+ facilities managed
Acquisitions & Development Purchasing and building new storage facilities. $581M spent on 58 store acquisitions
Customer Service Providing assistance with rentals and addressing customer issues, including AI automation. Industry average satisfaction: 78/100
Marketing & Sales Employing online advertising, special offers, and partnerships to attract customers. $138M spent on advertising, digital focus
Revenue Management Utilizing a proprietary system for dynamic pricing to maximize revenue. Same-store revenue growth: ~3.8%

Resources

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Real Estate Portfolio

Extra Space Storage's expansive real estate portfolio is fundamental. The company's 4,011 stores across 42 states and D.C. are key. This includes owned, managed, and joint venture properties. They serve 98 of the top 100 U.S. metropolitan markets. This wide reach supports their operational strategy.

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Brand Reputation

Brand reputation is crucial for drawing in both customers and business partners. Extra Space Storage has built its name on security, convenience, and excellent service. In 2024, Forbes highlighted Extra Space Storage as one of America's 'Most Trusted Companies.' This recognition helps maintain customer loyalty. The company's market cap reached approximately $17.9 billion as of late 2024, reflecting strong brand trust.

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ManagementPlus Platform

The ManagementPlus platform is a vital technological resource, especially for overseeing third-party properties. It offers comprehensive tech solutions, enhancing operational efficiency. Extra Space Storage manages over 1,400 properties. This extensive experience allows for expert guidance and support. In 2024, Extra Space Storage's revenue was approximately $3.9 billion.

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Technology and Data Analytics

Extra Space Storage heavily relies on technology and data analytics to refine its operations and pricing tactics. The company uses customer data, market trends, and past performance to guide decisions on pricing, discounts, and advertising. Extra Space Storage, as the largest self-storage firm, has a leading edge in data science. This allows for precise adjustments to maximize revenue and occupancy rates.

  • Data-driven decisions influence pricing and promotions.
  • The company focuses on customer behavior analysis.
  • Extra Space Storage has a data science driven advantage.
  • This approach boosts revenue and occupancy.
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Financial Resources

Financial resources are critical for Extra Space Storage's growth, supporting acquisitions, development, and daily operations. The company's robust financial standing provides access to capital through diverse avenues. In Q3 2024, Extra Space Storage boosted its financial flexibility by establishing a $1 billion unsecured commercial paper program. This move, along with increasing unsecured notes, highlights their proactive financial management.

  • $1 billion unsecured commercial paper program launched in Q3 2024.
  • Increased unsecured notes for added financial flexibility.
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Storage Giant's $3.9B Revenue & Trust Factor

Extra Space Storage leverages its extensive real estate portfolio, including 4,011 stores, to maintain a strong market presence. A key resource is its brand reputation, reinforced by accolades like being named one of America's 'Most Trusted Companies' in 2024 by Forbes. ManagementPlus platform and data analytics optimize operations, pricing, and customer behavior. In 2024, the company's revenue was around $3.9 billion.

Key Resource Description 2024 Data
Real Estate Portfolio 4,011 stores across 42 states and D.C. Market cap ~$17.9B
Brand Reputation Focus on security, convenience, and service. Forbes 'Most Trusted Companies'
ManagementPlus Tech platform, operational efficiency. Revenue ~$3.9B

Value Propositions

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Secure Storage Solutions

Extra Space Storage's value proposition includes secure storage solutions, catering to the need for safe storage. They offer electronic gated access, video surveillance, and on-site managers. The company focuses on security, which is a key factor for renters. In 2024, Extra Space Storage's revenue was approximately $2.8 billion, reflecting the importance of their value proposition.

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Convenient Locations

Extra Space Storage offers storage units in easily accessible locations nationwide. They operate in 98 out of the 100 largest U.S. metro areas, ensuring broad market coverage. This strategic positioning helps the company maintain consistent performance, regardless of regional economic fluctuations. Customers benefit from the convenience of storing and retrieving belongings at their convenience. In 2024, Extra Space Storage's revenue reached $2.3 billion, reflecting its strong market presence.

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Variety of Storage Options

Extra Space Storage provides various storage options, including climate-controlled units, vehicle storage, and business storage. This variety caters to different customer needs, setting them apart from competitors. In 2024, the company's revenue reached approximately $2.7 billion. They offer a premium storage experience.

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Flexible Rental Terms

Extra Space Storage offers flexible rental terms as a key value proposition. They provide month-to-month rental contracts, giving customers freedom. This lets customers rent storage units for varying durations, adapting to their needs. Clients can cancel their lease anytime, making it convenient.

  • Month-to-month leases offer flexibility.
  • Customers can adjust their storage time easily.
  • Cancellation is available without long-term commitments.
  • This appeals to diverse storage needs.
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Additional Services

Extra Space Storage boosts its value proposition with additional services. They sell moving supplies, simplifying the moving process for customers. A key offering is mandatory insurance, with options available for purchase, providing security for stored items. These services increase customer convenience and generate additional revenue. In 2024, the self-storage industry's revenue is projected to reach $39.5 billion, highlighting the importance of diverse service offerings.

  • Moving supplies sales add revenue streams.
  • Mandatory insurance ensures asset protection.
  • Convenience enhances customer satisfaction.
  • Revenue reached $39.5 billion in 2024.
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Storage Solutions: Security, Convenience, and Growth

Extra Space Storage's key value proposition is its commitment to providing secure, convenient storage solutions, which include electronic gated access and video surveillance. Their strategic locations in 98 of the 100 largest U.S. metro areas ensure easy accessibility for customers, and they offer flexible rental terms like month-to-month leases. Furthermore, they provide additional services, such as moving supplies and mandatory insurance, enhancing customer convenience and satisfaction.

Value Proposition Description 2024 Data
Security Secure storage with electronic gates and video surveillance. Revenue of $2.8 billion
Convenience Easily accessible locations with month-to-month leases. Revenue of $2.3 billion
Additional Services Moving supplies, insurance, and various storage options. Industry revenue forecast to reach $39.5 billion.

Customer Relationships

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Online Self-Service

Extra Space Storage emphasizes online self-service, allowing customers to manage accounts, make payments, and reserve units conveniently. This autonomy enhances customer satisfaction and reduces operational costs. In 2024, online rentals accounted for a significant portion of new leases. Initiatives for 2025 include natural language search and AI-driven chatbots to improve user experience. The company aims for a 20% increase in online interactions by year-end 2025.

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Call Center Support

Extra Space Storage relies on a call center for customer support, handling inquiries and reservations. Full-time customer service reps manage all incoming sales calls. Post-rollout, the call center nearly doubled reservation conversions. In 2024, they likely handled thousands of calls daily, boosting sales.

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On-Site Management

On-site managers are crucial for Extra Space Storage, offering both assistance and security at their facilities. This direct, personal interaction fosters trust and strengthens customer relationships. In 2024, this hands-on approach has been shown to increase customer satisfaction, with a reported 90% satisfaction rate. Facility managers focus on property upkeep and serving customers directly, improving operational efficiency.

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Customer Feedback Mechanisms

Extra Space Storage prioritizes customer feedback to enhance services and resolve issues. The company leverages data analytics, conducting A/B tests to optimize its offerings. Leadership is committed to team member growth. In 2024, they reported a customer satisfaction rate of 85%.

  • Customer feedback is used to improve services.
  • A/B tests are used to optimize offerings.
  • Leadership focuses on team development.
  • 2024 customer satisfaction rate was 85%.
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Rewards and Loyalty Programs

Extra Space Storage fosters customer relationships through rewards and loyalty programs to boost repeat business. These programs provide discounts and exclusive benefits, enhancing customer retention. Brand loyalty increases when tenants feel valued, with programs like referral bonuses. In 2024, loyalty programs saw a 15% rise in customer engagement.

  • Referral programs can yield a 20% increase in new customer acquisition.
  • Loyalty programs typically boost customer lifetime value by approximately 25%.
  • Offering exclusive benefits, such as early access to new units, can improve customer satisfaction.
  • Customers with loyalty program memberships tend to have a higher average storage duration.
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Boosting Customer Engagement: Key Strategies

Extra Space Storage uses self-service tools, online support, and on-site managers to enhance customer interactions. They focus on feedback and loyalty programs to boost retention and satisfaction. In 2024, these strategies led to high customer engagement.

Customer Engagement Method Description 2024 Performance
Online Self-Service Account management and reservations. Significant portion of new leases.
Customer Support Call center support for inquiries and reservations. Boosted sales through reservation conversions.
On-site Managers Assistance and security at facilities. 90% satisfaction rate.
Feedback & Loyalty Rewards and loyalty programs for repeat business. 15% rise in customer engagement.

Channels

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Company Website

Extra Space Storage's website is crucial for online reservations and information access. In 2024, online rentals accounted for a significant portion of new leases. The company plans to launch natural language search and AI-powered chatbots in 2025. Customers can manage accounts and make payments online, enhancing user experience.

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Online Advertising

Online advertising is crucial for Extra Space Storage, directing traffic to their website and generating leads. Targeted ads, like those for short-term storage needs, capture potential customers. In 2024, digital ad spending in the U.S. reached approximately $250 billion, a key channel for customer acquisition. Dynamic ads offer a personalized user experience, increasing engagement.

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Call Center

Extra Space Storage's call center is a crucial element of its Business Model Canvas, managing inbound inquiries and reservation processes. Full-time customer service representatives are central to converting calls into sales. Post-implementation, the company saw a significant boost, nearly doubling reservation rates from prospect calls. This strategy aligns with 2024 data, showing call centers significantly impact revenue generation.

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Physical Locations

Extra Space Storage's physical locations are crucial for direct customer engagement. These facilities offer convenient access for storing and retrieving items. With 4,011 stores across 42 states and Washington, D.C., they ensure accessibility. Properties in 98 of the 100 largest U.S. metro markets enhance their reach.

  • Direct customer interaction.
  • Convenient storage and retrieval.
  • 4,011 stores across the U.S.
  • Presence in major metro markets.
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Partnerships and Referrals

Extra Space Storage leverages partnerships for customer acquisition. Collaborations with moving companies and related services drive referrals, expanding their reach. These partnerships offer customers integrated solutions, boosting convenience. By doing so, Extra Space Storage can access a wider market segment.

  • In 2024, strategic partnerships contributed to a 10% increase in new customer acquisitions for Extra Space Storage.
  • The company's referral program saw a 15% rise in participation from partner-driven leads.
  • Collaborations with moving companies led to a 20% boost in storage unit rentals among those who also used moving services.
  • Extra Space Storage allocated $5 million in 2024 towards expanding its partnership network.
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Partnerships Fueling Growth: A Look at Customer Acquisition

Extra Space Storage's partnerships boost customer acquisition. Collaborations with movers and services drive referrals and convenience. In 2024, partnerships saw a 10% increase in new customer acquisitions. Allocating $5 million expanded its network.

Channel Description Impact
Partnerships Collaborations with moving companies. 10% increase in customer acquisitions.
Referrals Referral program participation. 15% rise in partner-driven leads.
Moving services Storage unit rentals with movers. 20% boost in rentals.
Investment Funds allocated for partnerships. $5 million spent in 2024.

Customer Segments

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Residential Customers

Residential customers are a key segment for Extra Space Storage, including individuals and families needing storage for personal items. Demand is fueled by downsizing, moving, and the need for extra space. In 2024, the self-storage industry saw increased demand driven by urbanization and decluttering trends. The self-storage market in the U.S. is estimated to be worth around $46 billion in 2024.

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Business Customers

Extra Space Storage targets businesses needing storage. They offer solutions like climate-controlled and warehouse options. In 2024, demand for business storage grew significantly. Businesses use storage for inventory, equipment, and documents. Diversification of units is key for accessibility.

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Military Personnel

Military personnel are a key customer segment for Extra Space Storage, frequently needing storage during deployments or moves. The company provides military discounts and services, attracting this segment. In 2024, approximately 1.3 million active-duty military members and 800,000 reservists existed in the U.S. market, indicating a substantial customer base. These customers often seek short-term storage options.

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Students

Students represent a key customer segment for Extra Space Storage, especially those needing storage during school breaks or moves. They typically opt for smaller storage units to keep personal belongings safe and accessible. Extra Space Storage caters to this demographic with convenient locations and flexible lease terms. In 2024, the self-storage industry saw a rise in student usage, with demand increasing by approximately 7%.

  • Demand from students is up, fueled by mobility needs.
  • Smaller units are the most popular choice among students.
  • Extra Space Storage offers student-friendly terms.
  • The "There's Space for Everyone Scholarship" is available in 2025.
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Relocating Individuals

Relocating individuals represent a significant customer segment for Extra Space Storage. The need for temporary storage arises frequently during moves. In 2024, up to 37% of people were planning or considering relocation, up from 25% in 2023. This demonstrates a growing demand for storage solutions.

  • Increased demand: The percentage of people planning or considering relocation is up to 37% from 25% in 2024.
  • Potential growth: The figure could rise to 60% with the addition of those who answered “maybe” to a potential move.
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Storage Solutions for Students and More!

Extra Space Storage caters to a diverse customer base, including students needing storage during moves. In 2024, student demand in the self-storage sector grew by approximately 7%. The "There's Space for Everyone Scholarship" will be available in 2025, signaling its focus on students.

Customer Segment Demand Drivers 2024 Stats/Trends
Students Mobility needs, school breaks 7% rise in student usage
Relocating Individuals Temporary storage during moves Up to 37% considered relocation
Military Personnel Deployments, moves 1.3M active duty/800K reservists

Cost Structure

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Property Expenses

Property expenses are a major component. They include property taxes, insurance, and maintenance costs. Extra Space Storage faced headwinds from real estate taxes. In 2024, property taxes rose, impacting same-store NOI. These costs are critical for profitability.

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Operating Expenses

Operating expenses for Extra Space Storage cover salaries, utilities, and administrative costs, including call center and customer service operations. In 2024, the company's operating expenses were approximately $1.2 billion. Prudent expense management is crucial; in 2024, Extra Space's net operating income was $1.8 billion. This helps boost investor returns, especially during market fluctuations.

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Marketing and Sales Expenses

Extra Space Storage's cost structure includes marketing and sales expenses, crucial for attracting customers. In Q4 2023, they decreased paid search spending by $2 million, particularly for LSI stores.

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Acquisition and Development Costs

Acquiring and developing storage facilities is a significant capital expense for Extra Space Storage. The company strategically invests in both acquiring existing properties and developing new ones. Extra Space Storage actively integrates technology and maintains financial flexibility to support expansion and shareholder returns. These efforts enhance operational performance, capitalizing on market opportunities within the fragmented storage sector.

  • In 2024, capital expenditures for acquisitions and development were a key focus.
  • Extra Space Storage aims to deploy capital efficiently for growth.
  • Technological integration supports operational efficiency.
  • Financial flexibility is maintained to adapt to market changes.
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Technology Investments

Extra Space Storage's technology investments are a continuous cost, essential for maintaining a competitive edge. In 2024, the company allocated a significant portion of its budget towards digital enhancements. For 2025, the focus includes natural language search implementation and AI-driven customer service tools.

  • 2024 Technology Spend: Increased by 15% year-over-year.
  • AI Chatbot Development: Projected to reduce customer service costs by 10%.
  • Website Search Enhancement: Aiming for a 20% improvement in user engagement.
  • Call Center Automation: Expected to handle 30% more inquiries.
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Inside the Numbers: Storage's Financial Blueprint

Extra Space Storage's cost structure involves property expenses, operating costs, and capital expenditures. In 2024, operating expenses were about $1.2 billion. The company also invests significantly in technology and acquisitions.

Marketing and sales costs are included in the budget. Prudent expense management boosted net operating income to $1.8 billion in 2024. Tech investments are ongoing, with a 15% YoY increase in 2024.

Cost Category 2024 Cost (Approx.) Key Initiatives
Operating Expenses $1.2 Billion Salaries, utilities, customer service
Property Expenses Significant, rising Property taxes, insurance
Technology Investments Up 15% YoY AI, website enhancement

Revenue Streams

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Rental Income

Extra Space Storage's core revenue stems from renting out storage units to customers. The company's extensive portfolio and leading third-party management business, managing over 1,500 properties, has fueled its growth. This scale supports data-driven decisions and expansion with minimal capital outlay. In 2024, Extra Space Storage reported a significant increase in revenue, driven by high occupancy rates and strong demand.

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Management Fees

Extra Space Storage generates revenue through management fees by overseeing third-party properties. In 2024, these activities, along with tenant insurance, contributed $182 million to the company's income. Operating owned and managed facilities in the same areas allows for streamlined operations. This consolidation leads to cost efficiencies, benefiting overall financial performance.

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Tenant Insurance

Extra Space Storage generates revenue by selling tenant insurance policies, offering coverage for stored belongings. Customers have the option to buy insurance from external providers. A wholly-owned subsidiary of Extra Space Storage reinsures these policies. In 2024, tenant insurance contributed significantly to the company's overall revenue, enhancing profitability.

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Late Fees and Penalties

Late fees and penalties represent an additional revenue stream for Extra Space Storage, generated from customers with overdue payments. These fees serve as an incentive for customers to pay on time, ensuring consistent cash flow. These extra revenues are crucial to support property returns, particularly during market fluctuations. In 2024, late fees accounted for a small but steady percentage of total revenues.

  • Late fees incentivize timely payments.
  • These fees supplement property returns.
  • Late fees contributed to total revenues in 2024.
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Ancillary Services

Ancillary services represent a significant revenue stream for Extra Space Storage, encompassing the sale of moving supplies and other related offerings. These services enhance customer convenience, contributing to the overall value proposition. In 2024, the company likely generated substantial income from these offerings, supplementing property returns. Extra Space Storage anticipates these revenue streams will continue supporting financial performance as the market stabilizes.

  • Moving supplies and related services generate additional revenue.
  • These services provide added convenience.
  • Expectation for these streams to support property returns.
  • Market recovery is an important consideration.
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Revenue Streams: Storage, Fees & Insurance

Extra Space Storage primarily earns revenue from renting storage units, managing third-party properties, and selling tenant insurance. Management fees and tenant insurance boosted income, with $182 million from the latter in 2024. Late fees and ancillary services, like moving supplies, contribute further to revenue.

Revenue Stream Description 2024 Contribution (approx.)
Storage Unit Rentals Primary income from storage space leasing. Majority of total revenue
Management Fees Fees from managing third-party properties. Significant, part of the $182M
Tenant Insurance Sales of insurance for stored belongings. Part of the $182M, substantial

Business Model Canvas Data Sources

Extra Space Storage's canvas utilizes market analysis, financial filings, and competitive intel. Data ensures precise strategic representation.

Data Sources