Interview with Phil Murphy, CEO of Storage by the Box
Cristian: Hi Phil and welcome to Entrepreneurship-interviews.com. Tell us a bit about yourself: you used to be an Oracle executive, how did you get to opening your own business?
Phil: I was raised in a family of entrepreneurs. Growing up, my parents owned auto repair shops and my grandma was also an independent business owner. I have always wanted to follow in their footsteps and own my own business.
My first endeavor was to buy a self-storage facility in Joliet about six years ago. I purchased the facility by refinancing my condo in downtown Chicago. It was a risk but owning my own business was my goal. I then leveraged my existing facility and so on until I had been able to open a number of locations. It was my experience in the storage industry combined with my background in technology that ultimately sparked the idea to launch Storage by the Box.
Cristian: How was the transition from a steady paycheck to being your own boss? Most people are afraid and stay in what they think it’s a safe zone – a 9 to 5 job. How do you know it’s time to do your own thing?
Phil: It was definitely an adjustment. I had to do a bit of belt tightening and budgeting to get through the first year and a half. I had been used to my paycheck magically showing up in my account every two weeks. Instead, I ended up not being able to pay myself for almost 18 months. When you’re your own boss, you have to deal with every financial-related aspect of the company, and that can be stressful at times.
When I was working in a 9 to 5 job, I always knew I would eventually leave to open my own business. It was just a matter of time until I could build up enough savings so I could afford to take the risk of starting a business.
Cristian: I understood that your business is about people or companies using external storage in a more efficient way than the industry standard. How exactly is this done?
Phil: Traditional storage offers cookie-cutter storage options. These are a waste of money for people whose items only take up part of the space. With Storage by the box, the customer is charged per box instead of a flat fee for an entire unit, so they only pay for the space they’re using. It’s a cost-effective solution to self-storage.
Cristian: What are the benefits for say, a small business looking to clear up office or production space?
Phil: Storage by the Box allows businesses to save time and money by getting employees back to work. Instead of trips to and from a traditional storage facility to retrieve items, the boxes arrive at their door. This lets your sales force get back to selling or your nurses back to treating patients. Along with improving productivity, Storage by the Box allows businesses to remain in their existing space longer. Instead of using expensive retail and office space to store boxes of records or inventory, the business can put them back to work. Sometimes this can even allow a business to remain in a location longer than they would if they didn’t have storage.
Cristian: What about families?
Phil: We provide a cost-effective solution for urban families who don’t use cars. It can be very time-consuming and labor-intensive to move heavy boxes across town by means of public transportation or taxis. For families, Storage by the Box is great for a college student living at home temporarily. Instead of moving heavy boxes back and forth for the summer, they can ship them to us hassle-free and get them back as soon as they’re needed for easy moving. Also Senior citizens and the disabled often are unable to lift heavy boxes and cope with the physical strain of moving, so this is an ideal service for them.
Cristian: What are the exact steps of using the storage service?
Phil: 1.) Go to www.storagebythebox.com to place your order. 2.) Indicate the number of boxes you need to ship, or order an unlimited number of 24x12x12 boxes (with bubble wrap and tape included) and we’ll send them to you free. 3.) Upload pictures and/or add descriptions of the items in each box (optional). 4.) Schedule a pick-up date and time and FedEx picks them up and we store them in our central warehouse. 5.) When you need them back, log onto the site and we’ll send them to you anywhere FedEx delivers.
Storage by the Box charges monthly rent on a sliding scale. 1-9 boxes are $5 per box while 15 or more are $4 per box per month.
Cristian: How did you come up with the idea?
Phil: A few years ago I was having dinner with a friend who lived in Manhattan. He was telling me about his miserable experience dealing with self-storage in the city. He had cleared out part of his apartment to make room for a new roommate and needed to get across town to a storage facility. He hauled his heavy boxes into a cab, and since the facility was in a “not-so-friendly” part of town where cabs were hard to find, he had the driver wait until he finished unloading his stuff. By the end of the night, he had spent $60 on cab fare alone, not including the high-priced storage fees charged in Manhattan. After talking to a few other people who had similar storage issues, I came up with the idea for Storage by the Box.
Cristian: Using FedEx for pickup and delivery seems expensive. Or isn’t?
Phil: It is actually surprisingly affordable. We have negotiated heavily discounted shipping rates with FedEx which we pass along to our customers.
Cristian: Can you estimate what are the average savings if you use your service compared to the traditional storage space rent?
Phil: Typical customers end up saving 50-60% over the cost of Traditional Storage. We also have a “Compare and Save Calculator” customers can use to see exactly how much they can save over traditional storage.
Cristian: In my opinion one important benefit for small businesses is that you can deliver the boxes anywhere and not necessarily to the pickup location. Sounds like an excellent option when you go to tradeshows and need to have promotional items stored and delivered in various locations. Is this something that can be done?
Phil: Yes, we have a number of businesses that use us for tradeshow and event marketing storage. We have an event marketing company that stores their displays and promotional items with us. They then have them shipped out for an event and at the end of the event have them shipped right back to storage. We helped eliminate the need to have their employees make trips to a warehouse to process the various items needed for an event.
Cristian: I’m not sure if you actually know what’s inside the storage boxes, but any exceptional situations or better said success stories so far?
Phil: We don’t actually open any of the boxes. However, we do have a band that uses us to store their merchandise while they’re on tour. They keep their t-shirts, CD’s and other merchandise at our facility. This allows them to decrease the amount of merchandise they have to bring along on a tour while giving them the ability to restock without a trip back home.
Cristian: Coming back to the entrepreneurial part, what was most challenging when you started up?
Phil: I knew the storage business and had a background in IT, but had never worked in a dot-com business. From a marketing and advertising standpoint, it has been a completely different experience from a traditional brick and mortar storage business.
Cristian: Some say everything has been done before or otherwise it doesn’t worth doing it. How can you validate that your idea or way of implementing it is unique and worthwhile in the same time?
Phil: We have new customers signing up every day to use our service. If it wasn’t worthwhile we’d be sitting there with a closed door. As for being unique, we are a new breed of self storage. We offer the convenience and ease of use the traditional storage industry lacks.
Cristian: If you were to start again, what would you do differently?
Phil: I would choose different service partners than the ones I originally went with. I had never developed an entire site from concept and therefore didn’t have the right connections to speed up the process. This ended up delaying our launch by almost 6 months.
Cristian: Any advice for people willing to start up on their own?
Phil: You’ll never be 100 percent sure it is the right time to start your own business, so don’t stick around waiting to “be sure.” Instead you need to just make the decision to do it and go for it. There will always be risk but in the end the regret of a missed opportunity or an unhappy career choice will be a much more significant weight on your shoulders.
Cristian: So is it really safer to have a 9 to 5 job? And do the rewards of running your own business worth the risk?
Phil: In this economy, I don’t think any job is safe. That’s one of the reason so many people are becoming entrepreneurs and launching their own start-ups or a small business the self employed ranks are expanding at one of the fastest paces ever. I realize everyone’s situation is different, but for me the rewards so far have been worth the risk.
Cristian: What about the future? Any plans?
Phil: As Storage by the Box continues to grow I’d like to open a warehouse in Nevada or California to serve the West Coast more efficiently. This will reduce the shipping time for returning customers packages as well as reduce costs by as much as 40%.