Image credits: U-Storage
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Analysis

U-Storage: from Pioneer to Self-Storage Market Leader

By Alejandro Enríquez | Wed, 12/09/2020 - 11:07

Large Metropolitan areas raise a battle for additional space. Think about it. As a business or as a person in a large city space is a luxury. It does not necessarily have to be, and self-storage is precisely raising the challenge of finding additional storage space in urban areas.

The self-storage concept is simple. The space you need it, for as long as you need it, with 24/7 access. For individuals and families, it comes in handy having an extra closet a few blocks away from home. For business, especially for e-commerce and last-mile deliveries, having access to space close to where the customers are is definitely a gamechanger.

This case study introduces U-Storage, a Mexican company that is bringing self-storage best practices into the Mexican market. According to the 2020 Self-storage Almanac, while in the US there are 158.8 million m2 of self-storage space, in Mexico there are just 256,000 m2. By taking a closer look at U-Storage's experience, it is easier to seize the potential of this sector for the Mexican economy.

"Our added value comes from our strategic location within major cities, particularly Mexico City, close to high-demand and high-consumption areas for e-commerce platforms and individuals looking for additional storage space. The self-storage concept provides flexible spaces in size and rental periods for both residential and commercial tenants. Different types of customers can manage their storage space according to their seasonal demand. Our locations also help digital sales sites develop efficient last-mile routes." said Diego Ysita, CEO of U-Storage to MBN.

 

E-commerce pressure on last-mile logistics

The pandemic considerably accelerated the digitalization of the digital economy in Mexico. The market value of e-commerce in Mexico spiked to estimates of MX$864 billion (US$42.8 million) of market value in 2020, a 36 percent increase from 2019 according to Statista. Now, e-commerce is not only about Amazon, Mercado Libre, or other large digital marketplaces. Small and Medium companies (SMEs) have also taken advantage of social platforms to ramp up their business.

Once the business is set, efficient logistics operations are essential. For Conejito de Trapo, an online store focused on baby products, self-storage was "a perfect solution". "When we started Conejito de Trapo one of the challenges was to find a safe place for our stock. In U-Storage I found the perfect solution where I can access my products 24/7 while they adapt to my storage needs as they change," told Cristina Pedrosa, CEO of Conejito de Trapo to MBN.

Having all-time access at convenient locations also helps companies increase customer satisfaction through rapid deliveries. "The benefit for us relying on U-Storage is to deliver our product to our customers in less than 24 hours while being reassured that our product is safe. It is more efficient for us having stock in U-Storage as we could react quickly to our customer demands. By having costs per square meter makes the prices competitive," wrote Alonso Curis from Vinicola Regional de Ensenada.

As the CEO of U-Storage said: "The pandemic accelerated digitalization and e-commerce by five to 10 years. As a consequence, companies experienced a disruption in their sales processes. Given the nature of U-Storage’s business model, we have become an enabler of both new companies emerging from the pandemic and existing companies that had to evolve rapidly. Our customers can find our nearest location and rent for a month to conduct their delivery process smoothly. The best thing is that they can conduct the entire process on the same day."

 

A Logistics Gamechanger

Logistics margins are tight. Finding more efficient alternatives in daily activities. Self-storage emerged in the need for flexible storage spaces rather than large warehouses in the middle of nowhere. U-Storage brings strategic location and rental flexibility to logistics players looking for those more efficient operations.

"Productivity has increased by 50 percent during 2020," wrote Gil Reznik from Big logística to MBN. "We can expand our storage immediately without investing our own resources and without waiting for additional contracts. All are immediate. By having "everything in the same place we were able to reduce our costs while integrating the operation immediately."

Self-storage also opens the door to logistics entrepreneurs like Iñaqui de la Peña, Country Manager of Dostavista, a company focused on last-mile deliveries. "U-Storage enabled us to ramp up operations  We set aside large investment projects to have a 100 percent operable place and manage our storage in a matter of hours. ‘All inclusive’ prices help us in our financial plan. Making a single payment is more efficient as it can be linked to a card," he told MBN.

U-Storage's solutions are flexible not only in time and space but also for different sectors, including chemical sectors. V Trade, a specialized company in raw materials and chemicals, affirms that: "We have had several benefits from working with U-Storage. location is key, and they have a very good reputation among different delivery companies. A benefit is that we have the confidence and trust that our materials are safe and secure," wrote David Colin, the legal representative of V Trade.

 

On the Road to Consolidate Market Leadership

U-Storage is Mexico’s market leader in self-storage solutions. By October 2020, the company had 11,500 customers 74 percent of which are individuals or families, and 26 are businesses. Among its plans for expanding its footprint in the country, the company is exploring partnerships with real estate developers, e-commerce players, logistics companies, and more segments across different cities.

“Our vision is to continue being the reference for the self-storage sector and space solutions in the country. There is a great deal of room to grow. Additionally, urban trends are driving people and companies toward self-storage. Our goal is to be the solution for all the storage needs faced by entrepreneurs, businesses, and other users. We are a socially responsible and sustainable option as we become part of their communities. Our infrastructure has environmentally-friendly features that also add value to our customers while reducing our carbon footprint,” said Diego Ysita.

Photo by:   U-Storage
Alejandro Enríquez Alejandro Enríquez Journalist and Industry Analyst