Vietnam Self-Storage Market Size

Vietnam Self Storage Market Analysis

The Vietnam self-storage market is expected to grow at 4.1% CAGR during the forecast period of 2021-2026. The self-storage industry is a sub-sector of the commercial real estate market. The growth in this industry is expected to be positive, during the forecast period, due to the trends of increased urbanization and improved economic outlook, which have led to new business growth. Although self-storage facilities are widely available in mature markets, such as the United States and western Europe, they remain a relatively new concept in Asian markets, such as Vietnam, the Philippines, etc.

• The prevailing trend in the e-commerce sector, of opening physical stores for pick-up and delivery, also supports the growth of the self-storage market. Along with the rising growth of the e-commerce sector across Vietnam, niche service demands like a climate-controlled environment and specialized spaces for sports equipment, also provide many growth opportunities to the Vietnam self-storage market.
• According to ISEAS-Yusof Ishak Institute, approximately USD 1 billion has been poured into Vietnam's e-commerce vertical over the last four years, reaching a record high in 2019. According to recent research by ISEAS-Yusof Ishak Institute, Southeast Asia's e-commerce sector will triple to USD 240 billion by 2023. The increasing investments in the e-commerce sector will drive the country's adoption of self-storages.
• In 2019, Vietnam's economy continued to observe fundamental strength and resilience supported by robust domestic demand and export-oriented manufacturing. According to the data provided by Worldbank, real GDP grew by about 7% in 2019, which is considered to be one of the fastest growth rates in the Asia Pacific region. The strong growth in GDP is one of the potential drivers for the Vietnam Self-storage market.
• Vendors in the market are employing social media to engage their customers and secure their leads across the sales funnel. Vendors in the market invest in automating their operations procedures to achieve significant profits, improved efficiency, and faster growth. The deployment of kiosks and online booking services for effective and quicker customer service is an example of this strategy.
• With its deep integration with the global economy, Vietnam has been hit significantly by the COVID-19 pandemic. However, the pandemic's health impact has not been as severe in Vietnam as in other countries due to proactive measures at the national levels. The macro-economic and fiscal framework remains resilient, with a reported GDP growth rate of 3.8% in the Q1 of 2020 (according to Worldbank). Vietnam's economic growth is projected to slow down to 3-4% in 2020 compared to 6.5% pre-crisis projections. COVID-19 pandemic has also shown the need for more robust economic reforms to help the medium term's business recovery. As a result of the economic downturn, it will affect the adoption of self-storage solutions upto some extent.
• As the country has significantly managed the COVID-19 pandemic situation with precautionary measures, the self-storage vendors continue their businesses as usual. For example, KingKho Mini Storage's Hanoi facility has opened to meet the customer's typical storage demands.