All,

We are in the process of establishing a contract with an off-site
storage facility in Sao Paulo, Brazil.  Now, while I do not consider
myself an expert in Brazil storage fees, I do have some limited
knowledge of the market in Brazil - I know that the cost of labor and
real estate (and space) are lower than the US. I know the price of fuel
is cheaper than the US, in fact the vast majority of their automobiles
use ethanol fuel. Hence, you would think or at least one would reason
that the cost for storage is cheaper than the US.  However, the price
proposed for storage is 250% higher than what we pay here in the NYC
area.

I also understand that the number of boxes that will be kept at the
off-site storage facility plays a big part of the price proposal.
Currently, we have approx 33K boxes in our domestic storage facility.
In Sao Paulo we only have 500 boxes, but we expect to rapidly grow to
approx 4k to 5k within the next year.

For those of you who have experience in the Brazil/Sao Paulo market, do
you think a 250% price differential is the norm there?  Any thoughts,
ideas, etc., are welcomed!

Thanks,

Vladimir

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