The Challenges Faced By Self Storage Industry In Latin America

22 Aug

Self storage facilities like operate in different environments because they have to face a highly competitive marketplace with the need to choose a good location to gain maximum profits. In the early 60’s and 70’s self storage was virtually unknown and the facilities operate in a market that that has no competition. Recently, the problem of self-storage facilities is the demand far exceeds the supply.

In some countries, people have little awareness of self storage. In Latin America, there are 10 different Spanish terms for the product because Latin America encompasses 21 distinct countries that spread across the Caribbean as well as Central, North and South America. In Latin America, most of the customers of self storage are males between the ages 36 and 55. Most of the customers frequently belong to the middle-upper or upper class meaning the customers of self storage is limited to only at least 40% of the population.

Most of the customers have lived in the metropolitan area for most of their life and they do not like to move farther than 15 kilometers away from the big cities. According to industry statistics, only 3% of the customers of self storage live more than 10 kilometers away from the facility.

Face to face interaction is very important to the customers because it is part of establishing and maintaining good customer relationships. In the Latin American region, customers will generally ask for discounts because they like to bargain. Customers also trust referrals from their families and close friends.

The amount of commercial and residential storage in each country also varies. If the storage facility came into existence as part of a moving company, residential tenants tend to be as high as 90%. If it is a part of a warehouse, commercial customers will be as high as 80%. Facilities that were conceived as self storage generally have 55/45 commercial/residential mix.

Security is also a major issue in Latin America particularly in the countries that are experiencing civilian unrests and natural disasters. Customers need proof that their belongings are secured and safe that is why self storage facilities have CCTVs, door alarms and armed guards.