Australia’s $1 Billion Storage Industry

A recent IBISWorld report stated that Australia’s $1.1 billion self-storage industry is expected to increase by 3.3% in 2017.

The demand for storage facilities in Australia

According to Tristan Williams, IBISWorld senior industry analyst, the industry has gained from several factors, which includes a lot of Australians moving to the major cities and into the smaller town houses or apartments. It was also known from the report that there is a greater demand coming from people that relocated short term due to study or work.

He said that the demand coming from businesses, specifically small online retailers that need storage for stocks, also increased during the past 5 years.

Start-ups in the storage industry

Even though the primary players, such as National Storage, Storage King and Kennards, dominate one-third of the storage industry in Australia, there exists hundreds of smaller players. These comprise of the newer entrants like Spacer, an online marketplace that matches extra space from people’s garages or homes with the people that need storage spaces.

Mike Rosenbaum, the co-founder of Spacer, mentioned that an average user spends $250 monthly to rent space, which is what is normally required to pay for one lock-up garage located in Sydney’s or Melbourne’s suburbs.

The customers of Spacer usually look to store business stock, household goods or vehicles for recreation like caravans or motor homes, according to Rosenbaum. However, the storage space that is used for household items is the most needed.

Spacer started early 2015, and it has 2000 storage spaces listed in its site. Rosenbaum expects his business to increase 500% to 600% in the next year.

Not always booming

Susan Philips from the Self Storage Association of Australasia mentioned that it is not always booming for the industry. The downturns happening in the other industries resulted to difficult competition among the storage facilities, especially those in northern Queensland, parts of the Northern Territory and Western Australia.

She mentioned that people found it impossible to rent houses in Perth before, so a lot of people paid for additional storage. However, this is not any more the case.

Elsewhere, she said that new storage facilities are continuing to open in Melbourne and Sydney.

Conclusion

With the demand for removals and storage in Sydney and all over Australia, surely businesses, big or small, can benefit from this industry.

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