Trunkroom Channel English

Storage business (trunk-room, rental storage, container storage) potential going forward

Mr. Akira Sugawara
Yano Research Institute Ltd.


The business model as far as the real estate industry is concerned is of a storage business, but from the consumer’s perspective it is a storage service, that is, part of the service industry.

In writing my reports, I have used a combination of the terms “storage business” and “storage service”, which may have been confusing sometimes. My intention was to use “storage business” when writing from the operator’s perspective and “storage service” from the consumer’s perspective.
If real estate thrives on users (or things), the storage business could be the polar opposite. Even so, I think the perspective of the service industry is needed.
Combining all rental storage and container storage in Japan, there are currently about 355,000 rooms, which is equivalent to 0.0066 storage service spaces or rooms (container storage and rental storage) per household nationwide, or about one room per 152 households.

Quraz

In the US self-storage market, used for comparison with Japanese storage services, there were about 28.3 million units (rooms) as of 2011. (Japan has a mere 1.3% of the number of rooms as the US.) This figure means there are 0.09 rooms per US citizen, or about one room per four households (source: 2012 Self-Storage Almanac). Taking the Japanese market to be one-twentieth of the size of the US market, this represents a potential market growth of about four times the current size. Looking at the Greater Tokyo Area (one metropolis and three prefectures) where business units are already concentrated, the supply density is about double the national figure at 0.0140 storage rooms per household (or about one room per 71 households.) Zooming in on each prefecture, the density is 0.0163 rooms in Tokyo Metropolis (about one room per 61 households), 0.0136 rooms in Kanagawa (about one room per 74 households), 0.0145 rooms in Saitama (about one room per 69 households) and 0.0081 rooms in Chiba (about one room per 124 households). Tokyo alone, therefore, has barely reached the scale of one-twentieth of the US self-storage market.
In the US, there is already a high degree of awareness from the market and from consumers of storage services (self-storage), which have become part of people’s lifestyle. Even if customers are not approached by such services, the market environment is such that consumers can use them of their own volition.
In Japan, however, although the degree of awareness has risen to a certain extent, the breakthrough point in the rate of use has not been reached.

Becoming a service industry

In the “free comments” box of our questionnaire, one elderly person living in a suburb wrote the following comment:

“I have always lived in a detached house, so I feel a lot of pressure even if I just inquire at a real-estate company. I dislike their aggressive business style. I would think about using their services if I could get advice from someone more easy-going and reassuring.”

Inevitably, this image of the market is deeply ingrained in people who, because of contract operations, are often approached by estate agent operators or intermediate operators.
When people look at the market, they can only see facility related matters such as location, money, service content (air conditioning, security), and so on. Their stereotypical way of seeing “rental space” instantly emerges. The above opinion is a reminder of this hurdle that ordinary people face. This may be where potential demand lies. I feel it is very likely that people have been halting one step short of actually using services.
Looking at a different industry, the used bookstore chain Book Off does not just wait for people to bring items to their stores, it offers a collection service. In the same way, some storage service operators provide a transportation service. There may be a need for storage operators to draw people and things into their facilities, too, through special services, events and so on, although some legal difficulties may exist. For example, it may be important to not only publicize by distributing leaflets or direct mail but also to raise awareness of storage services in communities through events such as free trials or treasure hunts. Presenting storage facilities as brighter, more open places rather than deserted warehouses would probably create some vibrancy in the market.

From storage rooms to storage services

The degree of awareness of storage services, whether rental storage, container storage or trunk-room, is still by no means very high. The simplest way to describe storage services in a few words is taking one’s belongings from storerooms or cupboards and having them kept outside the home, but I feel that such a description does not really answer the questions of why storing belongings from one’s home should cost money and what the benefits would be. Instead, I think it is necessary to create a situation in which people will lose out if they do not use these services, by making suggestions and forming systems. Market expansion will be speeded up not by just waiting for people to use services one day, but by developing a position of involvement in multiple services. For example, services should always be available at car parks, always included in rent for accommodation, always offered when relocating or renovating one’s home, always made available when moving into a facility for the elderly, and so on.
I think there is a need to advertise a range of storage services and give customers the choice, whether it is a space to rent, a place to store important items, a convenient location to keep hobby equipment, a place to keep their valuables safe, or something else. Everyone has their own story about keeping things, and I believe that telling these stories will lead to more people becoming users.

  • Some containers were installed at a nearby monthly-payment car park overnight.
  • A company that used to do sales changed address and switched to rental storage.


Whether in the form of rental storage, container storage or trunk-room, we can find many of these “boxes”. While the number of business units around me is increasing, I have never heard anyone I know mention people using storage services. Perhaps this gap says a lot about the current position of storage services.
Ordinary people still cannot imagine leading a lifestyle of using storage services and putting their stuff into these boxes. Storage company websites show many photos demonstrating how their services can be used. So how have users’ lives changed since they began utilizing storage services? If their new lifestyle was very stylish and logical and evoked a positive response from others, it would possibly be copied and spread by word of mouth. But right now, people just say things like, “You can fit quite a lot in, can’t you?”
To talk again about another industry, the home improvement field used to be so full of unscrupulous and malicious operators that consumers hesitated to use any home improvement services on the market. Thanks to the TV program Before After, the image of the market has in many cases been completely turned around. If the storage industry can gain its own Before After publicity, especially to show how its services can change people’s lifestyles, there is potential for growth particularly among the younger generation.

Storage services will advance to the next growth stage if they become part of people’s lifestyle infrastructure, not just an arm of the real estate industry.


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