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Self-Storage Newsletter JUNE 2020

Shift to remove work

As a storage operator with increasing competition you must find a way to differentiate yourself from the competition. Modernizing and digitizing your operations and processes will give you the ability to work from anywhere while you increase efficiency.Today we will be talking about remote work and operations. It’s not just about technology but also a shift in how you manage your team and how you do your work.

Ditch the hanko – figure out how to do online approvals. It’s 2020 and no need to pass a piece of paper around with 37 stamps – yeah – you know we are talking about you.

shifting to work from home

It’s also time to look at all those processes. Are you really getting benefits out of each and every one? It’s not about creating more processes – it’s about creating less. It’s about doing stuff that only has value. If business is slow, spend some time house cleaning your processes and throw out the ones that don`t have value.

Managing by objective and data is more important than ever. To understand if your business is heading the right direction you need to know what’s important for measuring your business. Identifying and reporting on a few KPIs is crucial in this environment. Sitting around a conference table for hours and not getting anything done just isn’t feasible. Collaboration tools are key to ensure that the right people get the right information at the right time. Hands down –

SLACK – is the best tool we have come across. It’s easy to use, easy to adopt and free to start with. It’s like Skype on steroids. If you have interest – let us know – we can offer some free training to RSA members.

Mr Hagiwara from Quraz, current storage business and the future growth

For our first newsletter, we interviewed Mr. Hagiwara, Senior Director of Quraz, one of the biggest self-storage company in Japan. He talked about how the self-storage market has changed in the last 10 years and how it will expand in the near future.

Q1. In an article published in 2013, it is stated that the growth rate of the self-storage market has been about 10% annually but is it still the case as of now, and what is your view of potential growth in the next 10 years.
https://www.quraz.com/trunkroomchannel/english/018.aspx

A1. The domestic self-storage supply has continued to grow consistently 8-10% relative year over year through to 2020, although the buildup and nature of that growth has evolved has fluctuated, more specifically; outdoor containers have not seen growth in the past few years.

The quality of indoor storage product has significantly improved with operators/developers focusing on dedicated ground-up new facilities with street presence and actual real estate value, in contrast to the generation subleasing a single floors of old office buildings. So all-in-all there has been a shift to higher quality in past five years, which I think is great for the industry long term.

Q2. Looking back at data published about 10 years ago [https://www.quraz.com/trunkroomchannel/english/002.aspx] comparing the US and Japan market size and penetration rates, what has changed and how has the market evolved?

A2. 10 years ago many analysts suggested that the US market was already fully saturated. The industry continues to grow at records levels at all-time low cap rates. The global real estate bubble and frothy pricing of estate in the past few years has made profitable growth difficult in the US impacting growth. Same thing here in Japan really with all-time low office vacancies and cap rates for all real estate sectors.

Q3. What do you see as the major difference between Japan and overseas storage businesses?

A3. The biggest difference between US and JP market (ignoring market size and history) is the institutional capital. In the past 5 years Japan is starting to see more institutional capital come into the market, and similar to what happened in the US four decades ago it’s the availability of credible financing and commitment from institutional investors that will be the real catalyst for growth. The US market is way too big to compare, but the JP market is slowly chasing after and certainly on it’s way to expand.

Q4. In this report [https://www.quraz.com/trunkroomchannel/english/003.aspx] one of the top issues Japan`s Self-storage operators are facing is Lack of awareness. What do you think could be done to solve this problem?

A4. Awareness of the self storage market is still low, but actually there is more demand than supply. The challenge for operators is to correctly price that demand. Ultimately supply growth will continue to drive awareness growth, and as mentioned above the increase in higher quality dedicated storage facilities really help to build positive product awareness for the industry.

Q5. How do you think technology has changed the Self storage industry?

A5. Self-storage is obviously not a technology product, and also is not a high engagement service (like service office, hotels, student housing or sports gyms) which is actually what makes storage attractive as a business. In that sense most of the technology enhancements have come in the form of systems for businesses to operate more effectively and more efficiently in providing sales and service to their customers, a lot of which is naturally online. Technologies are used more on the back-end side of the business rather than where customers see or directly interact.

Robots for Self-storage

Robots have been one of the biggest fields to be featured in the world’s advanced technology. Especially with the noticeable fall in Japan’s population, it is easy to say we already face a huge issue in lack of workers. Robots are said to be the feature and solution in various industries. Self storage industry is also no exception to this.

French company Wyca was one of the first companies to introduce robots to the self storage market with their expansion in North America. Store friendly in Hong Kong was the first company to have robots at their storage outlet in Asia. You can find out more about Wyca and Store Friendly below.

https://www.wyca-robotics.com/
https://www.storefriendly.com.sg/why-storefriendly/