How booming online businesses and ‘itchy feet’ pandemic home-movers are driving the self-storage industry to new highs in 2022
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How booming online businesses and ‘itchy feet’ pandemic home-movers are driving the self-storage/portable buildings industry to new highs in 2022
There’s no question – COVID-19 fundamentally changed the fortunes of businesses, industries and consumers across the globe. Restricting movement, the pandemic brought about unprecedented growth in the e-commerce sector, with an additional $219billion being added to e-commerce sales in 2019-2020 from the US alone. In the self-storage container industry, the changes have been manifold.
Many businesses were forced online in order to stay afloat, and many more saw new opportunities driven by the increase in online shopping. EbayUK reported a 237% rise in new ‘shops’ setting up on its marketplace, indicating that new suppliers were seeking to meet rising demands.
What does this mean for self-storage? Well, many online businesses, which can be easily operated from homes and small office spaces, require somewhere to store their stock, and renting a container has major economic benefits over renting a warehouse or larger space. Not only do most self-storage companies run without minimum stay requirements, making them low-commitment/low-risk, but the costs associated with them are far lower in terms of both rental rates and running costs.
The Good News
New business customers aside, the pandemic also drove a 133% increase in home movers between 2020 and 2021, as the government provided a stamp-duty holiday and those forced to stay home for months on end suffered from ‘itchy feet’. Delays in completion, caused by halts on construction and other factors, meant that droves of these eager home-movers were left having to use self-storage as a means of keeping their possessions safe until their move-in date was set.
With both business and domestic demand soaring, however, the self-storage industry has not been without its own supply issues. As shipping companies had to stop sending out their cargo ships, images of uncollected containers emerged from ports around the globe. Problems have continued as staffing issues have thwarted attempts from shipping companies to get back on track, and the supply of containers has dwindled significantly, everywhere. The costs of shipping containers have risen as much as 300%, having a knock-on effect across the industry, and there are no signs of improvement, with shortages remaining in place throughout 2022.
Accordingly, the self-storage industry looks set for major expansion as the e-commerce boom continues. However, this will be dependent on the number of new containers available on the market as shipping companies try desperately to catch up with unprecedented delays and new restrictions. Only time will tell, but the outlook is hopeful that the pandemic-driven trends in e-commerce will maintain new levels of demand for self-storage into 2023 and beyond. This will allow time for companies to bounce back, build stock, and take advantage of new opportunities for (busier) business.
November 24, 2022
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