Public Storage 2003 Annual Report Download - page 15

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5
Business Attributes
We believe that the Company possesses several primary business attributes that permit us to compete
effectively:
Comprehensive distribution system and national telephone reservation system: Our facilities are part of a
comprehensive distribution system encompassing standardized procedures, integrated reporting and information
networks and centralized marketing. This distribution system is designed to maximize revenue through pricing and
occupancy.
A significant component of our distribution system is our national telephone reservation center, which
provides added customer service and helps to maximize utilization of available self-storage space. Customers
calling either the toll-free telephone referral system, (800) 44-STORE, or a storage facility, are directed to the
national reservation system. A representative discusses with the customer space requirements, price and location
preferences and also informs the customer of other products and services provided by the Company and its
subsidiaries. We believe that the national telephone reservation system enhances our ability to market storage space.
Containerized storage option: Historically, we offered storage spaces for rent through our traditional self-
storage facilities whereby customers would transport their goods to the facility and rent a space to store their goods.
In late 1996, we organized Public Storage Pickup and Delivery, Inc. as a separate corporation and a related
partnership (the corporation and partnership are collectively referred to as PSPUD) to operate storage facilities
that rent portable storage containers to customers for storage in central facilities.
Management adopted a business plan in 2002 that included the closure of 22 non-strategic containerized
storage facilities of the then 55 facilities. During 2003, an additional nine facilities were identified as non-strategic
and scheduled for closure. As of December 31, 2003, six of the 31 facilities scheduled for closure were still in
operation - however, these facilities are in the process of closing which may take until the end of the second quarter
of 2004 to close.
The concept of PSPUD is to provide an alternative to a traditional self-storage facility. PSPUD delivers a
storage container(s) to the customers location where the customer, at his convenience, packs his goods into the
storage container. PSPUD will subsequently return to the customers location to retrieve the storage container(s) for
storage in a central facility. At December 31, 2003, PSPUD had 24 facilities (excluding certain facilities that are in
the process of being closed) in operation in 11 states.
Retail operations: The Company has historically sold retail items associated with the storage business and
rented trucks at its storage facilities. In order to supplement and strengthen the existing self-storage business by
further meeting the needs of storage customers, the Company has expanded its retail activities over the last five
years.
In addition, full-service retail stores have been retrofitted to some existing storage facility rental offices or
built-in as part of the development of new storage facilities, both in high traffic, high visibility locations. The
strategic objective of these retail stores is to provide a retail environment to (i) rent spaces for the attached storage
facility, (ii) rent spaces for the other Public Storage facilities in adjacent neighborhoods, (iii) sell locks, boxes and
packing materials and (iv) rent trucks and other moving equipment.
Tenant insurance program: On December 31, 2001, the Company purchased all of the capital stock of PS
Insurance Company, Ltd., from Mr. Hughes and members of his family. This insurance company reinsures policies
issued to our tenants against lost or damaged goods stored by tenants in the Companys storage facilities. This
subsidiary receives the premiums and bears the risks associated with the re-insurance. The Company believes that
this insurance operation will continue to further supplement and strengthen the existing self-storage business and
provide an additional source of earnings for the Company.