American-style self storage facilities are still relatively new to the UK, with the first ones appearing in London as recently as the early-1990s. Although the market has grown rapidly since then, it still remains significantly smaller than its counterpart in the USA, with the UK having many fewer facilities relative to the size of its population.
The difference in scale between the US and UK self storage industries is really quite remarkable. There are now just slightly over 1,300 self storage facilities in Great Britain, according to Storage.co.uk, the UK’s first online self storage directory; this compares to 54,000 business which offer self storage of some kind in the USA, according to the US Self Storage Association’s annual factsheet.
The difference in scale between the two countries can also be expressed in a more impressive way. If you added together the total floor area of all the self storage units in the UK and divided it by the size of the population, each person would have 0.44 sq ft of self storage space to themselves – whereas in America, the equivalent figure would be slightly over 7 sq ft each!
Apart from being smaller, what else is different about the UK self storage market?
The fact that it’s much smaller makes the UK self storage market different in several key ways. To begin with, it is considerably more concentrated, with a small number of big self storage companies owning a large proportion of the facilities. In 2010, the 12 biggest self storage firms – those owning 10 or more stores – accounted for 401 of the UK’s facilities, which was almost a third of the total.
Of course, the US has major self storage companies too, but they have much less market dominance – between them the five largest American self storage companies own less than 10% of all the facilities in the country, again according to the US Self Storage Association. Britain is like the USA in that it has its fair share of small self storage facilities – often family businesses which own just a single site – but they are a smaller share of the total. So-called “mom and pop” operations account for 80% of Britain’s self storage businesses, but even when added together they own just slightly more facilities than the ten largest companies combined.
Another important difference is that, because of the relative shortage of supply, self storage facilities in the UK tend to be comparatively more expensive than their US equivalents. In London and the South East of England – which remains the region where most of Britain’s self storage facilities are located – it is not uncommon for them to charge around £22 ($34) per square foot a year. This means that renting a 200 sq ft unit for twelve months can easily cost nearly £4,500, which would be over $7,000 in America.
The US Self Storage Association claims that, in America, what it calls a “traditional” self storage facility typically only yields $8.65 per sq ft annually – so the same 200 sq ft unit would be considerably cheaper at just $1,730.
The fact that there are so many fewer self storage facilities in the UK also means that self storage has had much less of a cultural impact. While there is a growing awareness among the general public of how self storage works – “Storage 24”, a recent British horror movie, was even set within a London self storage site – it doesn’t have the immediate cultural recognition among British audiences which would enable a TV show like “Storage Wars”, the recent hit from the A&E Network, to find success over here.
Who are the biggest players in UK self storage?
As mentioned above, a small number of major companies are particularly dominant within the UK self storage. Between them, the three biggest firms own about a fifth of the total – they are:
Safestore Self Storage – This is the UK’s largest self storage provider with 96 stores in locations around the UK. They have recently attempted to boost their public profile through a dramatic TV advertising campaign which features a young boy making a Churchillian speech to his teddy-bear as it gets carted off into a self storage unit. One of the few UK self storage companies to have expanded beyond London and the South East, they now have at least one store in virtually all of Britain’s major towns and cities.
Big Yellow Self Storage – Although Britain’s second largest self storage company by number of stores, with 76, Big Yellow probably has the highest public profile. This is largely due to their distinctive yellow branding – the outside of all their stores are coloured yellow, as is all their publicity material – and the fact that they were the first UK self storage company to invest in TV advertising. Big Yellow is also possibly the UK’s most innovative self storage company, having branched out into specialist ventures like their wine storage facility in West London, and their “eco-store”, an award-winning facility where everything has been designed to be as environmentally-friendly as possible.
Access Self Storage – The third-largest self storage company in Britain, with 60 stores, Access has quietly expanded to build up a national profile of self storage facilities, although it remains centred on London.
Could a US self storage company enter the UK market?
The only major self storage company in Britain which doesn’t have domestic origins is Shurgard Self Storage, the American firm which is now owned by Public Storage and operates in 12 European countries. Building on the experience they gained working in America, they have developed a strong profile of 22 attractive, well-designed stores across London.
While it’s debatable whether this is a good time for any new providers to be entering the UK self storage market (most of the established firms are still holding back on opening new stores following the financial crisis in 2008), the fact that there is such a big gap between the amount of self storage space per person in the UK and the USA suggests that there is room for new self storage companies, and many of the business lessons which apply to running a self storage facility in the USA would apply in the UK as well.
Any American firm which tried to move into the UK market would probably face some difficulties they hadn’t encountered before, however. In particular, it is often much harder to get permission to erect new buildings in the UK, which is why many British self storage centres are in older industrial buildings which have been adapted. Another problem, which was touched on above, is that the level of public awareness of self storage is generally quite low, meaning more creative marketing strategies are required in order to get peoples’ attention – although self storage marketing increasingly happens online, like in the US.
However, despite a few local nuances, the business model of UK self storage facilities is essentially the same as that found in the US – get hold of some space, and lease it out to as many customers as possible. When looked at like this, the self storage markets in the two countries really have much more in common than might seem to be the case at first glance.
David Kingman is a writer, blogger and editor for Storage.co.uk, Britain’s leading search engine for self storage – a free service used by both customers and self storage professionals.