Hong Kong shared mini-storage startup Boxful will acquire Taiwanese ALL IN Premium Storage, saying the deal will help speed integration of Taiwan’s warehousing market and bring benefits of scale.

In the storage sector, this commonly means logistics costs will fall as the company’s infrastructure grows, the Hong Kong firm has said. Storage costs would also come down as the merged firm adds warehouses in the outskirts of suburban New Taipei City where land costs less than in central Taipei.

Boxful entered the Taiwan market a year after its launch in 2015. The company picks up storage items directly from customers and offers 24-hour surveillance, automated fire prevention systems and climate control.

Search for acquisitions

Boxful is optimistic about the mini-storage market’s future development in greater Taipei, says Casper Koh, the firm’s Taiwan general manager. It’s now looking to acquire other market players such as ALL IN.

There are currently over 10 large companies in Taiwan’s storage market. Among them are ALL IN and More Space.

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Boxful says the market is a relatively young in Taiwan, as in the past most consumers weren’t in the habit of storing possessions outside their homes.

The amount of capital raised in its round premier series-A venture capital funding gave Boxful the cash it needed to make takeover offers in Taiwan.

According to a press release in November last year, by the end of 2017 Boxful had raised US$18 million from its B-round of venture capital. Investment came mainly from the property industry in Hong Kong, Taiwan, mainland China and Singapore.

That sum was the storage industry biggest ever raised from a single venture capital round in Asia, the press release said.

Boxful has massed over US$26 million in capital altogether.

The accumulation of capital gave Boxful enough funding to acquire ALL-IN, though it will not disclose a purchase price.

The Taiwanese firm launched in 2016 and operated two warehouses in New Taipei City. Boxful already operated four warehouses in the greater Taipei area and is now building a fifth to accommodate ALL IN’s customers.

Boxful says, while it was not the biggest player in the industry, such More Space, ALL IN had important corporate clients, such as ecommerce businesses.

Boxful’s growing reach in Taiwan

Boxful’s operations are growing an average of 20% percent per month and expanding across northern Taiwan.

 Koh said in a news release that high local housing prices and limited space in homes have raised demand for shared warehousing. Seasonal weather changes drive demand, too, Koh said.

When the weather warms up, many consumers store heavy clothes and bedding in a shared warehouse. Collectibles, figurines, toys and other adornments also end up in greater Taipei storage units alongside business property and ecommerce wares.

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Boxful quotes a statistic by Ubee that an average tatami mat-sized floor space in a Taipei city apartment cost on average NT$1,648 (US$50.23) to rent per month last year. The warehouse space costs less.

Boxful says ALL IN’s former customers can move stored items into Boxful’s space as part of a preferential plan.

The article first appeared on Business Next.

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