What is the storage business?
The storage business market is expanding with the evolution of various types of business such as trunkroom and rental storage space.
Mr. Akira Sugawara
Yano Research Institute Ltd
This is a series of ten reports on the storage business and self-storage markets in Japan, from a market environment perspective.
On storage business, which is currently capturing attention.
Many billboards for trunkroom and rental storage space have appeared on the corners of urban buildings or along highways passing through suburbs. We conducted a market survey on trunkroom and other storage businesses by asking some simple questions from the perspective of the ordinary citizen, such as who would actually pay to rent space to store their own possessions, and how many users of such facilities are there.
Surprisingly, trunkroom have been in operation in Japan for more than three decades, but recently the market has grown sharply due to the changing times and increased demand. We also realized that markets overseas (especially in Europe and the U.S.) are larger than in Japan.
At first we thought the storage business was simply the renting out of vacant space, but in fact it is a service that could have the potential to change the conditions of homes in Japan, jokingly called “rabbit hutches” or “eel beds,” and the lifestyle of its citizens.
However, Japan is approaching a big turning point in terms of its demographic structure, lifestyle, economy, society, and so on. Unlike the past when these were always on the up, nowadays there is stagnation and, in some cases, things even disappear from the market. Amid this changing market environment, we report on the market trends of the storage business and explore the factors for its continuous growth going forward.
Storage business definitions
First of all, a storage business is defined as a service that “provides storage space in exchange for a fee, or stores belongings in exchange for a fee, regardless of whether it is for an individual or corporation.” In a broad sense, therefore, baggage lockers at stations and safe deposit boxes in banks can also be regarded as types of storage business.
Within the storage business as defined above, we will describe three areas: trunkroom, rental storage, and container storage.
The definitions of the key terms are as follows:
- Storage business
In the broadest sense of the term, this is a service that provides storage space in exchange for a fee, or looks after general belongings in exchange for a fee, regardless of whether it is for an individual or corporation. In this series of reports, however, it is limited to rental storage, container storage, and trunkroom as defined below.
- Rental storage
Mainly offered by real estate businesses, this is a service renting out space for individuals or corporations to keep their general belongings. It provides indoor storage space mostly in office buildings or other specialized buildings. It does not include services such as baggage lockers at stations or safe deposit boxes in banks.
- Container storage
This is a service similar to rental storage but providing storage space in the form of outdoor containers, steel storerooms, and so on.
- Trunkroom
This is a service offered by warehouse operators who use trunkroom regulated by the Ministry of Land, Infrastructure, Transport and Tourism to store customers’ general belongings, furniture, and so on. This series of surveys only deals with rooms used by individual customers, and excludes document storage and rooms used by corporations.
- Trunkroom
This is a service offered by warehouse operators who use trunkroom regulated by the Ministry of Land, Infrastructure, Transport and Tourism to store customers’ general belongings, furniture, and so on. This series of surveys only deals with rooms used by individual customers, and excludes document storage and rooms used by corporations.
The term trunkroom is often used to describe storage services generally provided for the public, but in this survey these are called “general trunkroom.”
In the report, a trunkroom only refers to a room used by individuals (and excludes document storage and rooms used by corporations) as part of the services provided by a warehouse operator utilizing trunkroom approved by the Ministry of Land, Infrastructure, Transport and Tourism to store general belongings, furniture, and so on.
- Self-storage
This is the kind of storage service widely used in Europe and the U.S. Although it tends to be used synonymously with the trunkroom service in Japan, the content of this service actually differs from regulated trunkroom. Rental storage and container storage in Japan both fall into the category of self-storage.
Market size of the storage business
Our market survey results show that the market size of storage services (rental storage, container storage and trunkroom) in Japan increased 7.4% year on year to \48.92 billion in FY2012. Although growth was slowed for a while by the global recession from late 2008, since 2011 it has been back on track and the market has expanded against a backdrop of increased service sites and an upward trend in the operating rate of storage space.
Sites for rental storage and container storage, which are mainly used by individuals, have been increasing, especially in the three major metropolitan areas (Kanto, Chukyo, and Kansai) and regional cities (such as Sapporo, Sendai, Hiroshima and Fukuoka). In recent years, storage service operators have been expanding into regional cities by entering areas where no storage service sites existed before.
Furthermore, while storage space is often used for short-term purposes such as moving home, we see an increasing trend in customers’ continuous use in their daily life. In the same way that convenience stores drew in more customers in the past by increasing their stores, the storage service business is now also in a phase of attracting more users by gradually expanding its sites.
We therefore expect this trend to continue in FY2013 too, with the market size of storage services increasing by 6.6% year on year beyond the \50 billion mark to \52.15 billion (Figure 1).
A market size of \50 billion may not mean very much to most people. Well, for example, if each user were renting a single storage room at \5,000 per month for one year, it would mean there were more than 830,000 users in Japan. With a national population of around 130 million, this would indicate that the service was being used by about 0.6% of the entire population. Or to put it in more familiar terms, the market size is roughly equal to the amount needed to buy every Japanese person one and a half premium ice creams a year.
Figure 1. Changes in the market size of storage services
(rental storage, container storage, trunkroom) in Japan
About the Yano Research Institute
The Institute conducts comprehensive research and analysis on appropriate themes from a micro and macro perspective to determine trends in market size, business share, future prospects, trends among major players, and the like in a broad range of business fields.
We focused early on the storage business field, which continues to grow, and we have provided detailed investigative reports based on thorough reporting since 2010.
We are making a significant contribution to improving transparency in the storage business industry, by analyzing the future prospects, potential, and issues in a market that had scarce information.