A shed is generally a modest structure constructed in a back garden or on an allotment, used for storage and as a workshop and very often as a retreat in which to relax and pursue hobbies, especially gardening and light engineering. Sheds are often highly individual and personalized, and the larger shed will be made comfortable by adapting worn out furniture. As well as tools and euqipment, they generally house a cornucopia of items unwanted in the house that might, one day, prove useful.
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Further reading: Gordon Thorburn, Men and Sheds, ISBN 1843303299