THE GARDEN MARKET SUPPLEMENT 2018
Benchmark
GROSS MARGIN: BARTON GRANGE CONSISTENTLY THE BEST
% gross margin
1. Barton Grange 2. Coolings 3. Wyevale Squires
4. 5. Klondyke 5-year Latest average year -1 year -2 year
58.7 57.9 59.0 58.6 58.5 60.2 60.3 59.4 51.0 44.5 51.3 56.5 50.4 51.4 51.4 49.5 50.2 52.8 51.5 47.9
6. Blue Diamond 49.8 51.0 50.0 49.7 7. Dobbies 8. Notcutts Hillier
9. 10. Millbrook
49.8 49.2 50.0 50.4 49.8 47.9 47.6 50.4 49.0 49.3 50.1 49.0 48.6 52.0 48.6 49.4
11. Chessington 48.4 49.4 49.0 48.0 12. Webbs 13. Planters 14. Aylett 15. Polhill
16. Whitehall 17. Scotsdale 18. Van Hage 19. Frosts
20. Woodcote Green 21. Hayes 22. Bents
23. Haskins 24. Gordale 25. Stewarts 26. Garsons Average
47.1 46.6 47.4 47.4 47.1 49.8 49.7 47.6 46.1 45.5 46.7 45.8 45.9 46.9 45.5 45.9 45.8 46.3 46.1 44.9 45.3 46.0 46.7 45.5 44.4 45.0 44.6 44.0 43.3 46.9 47.8 43.6 40.9 45.8 46.3 45.6 40.0 34.2 41.0 41.1 37.1 35.8 37.0 37.1 36.9 37.1 36.9 38.8 33.1 32.1 32.4 33.0 23.6 23.7 24.1 22.5 12.9 15.3 13.2 12.3 46.6 46.8 47.4 47.0
-3 year
59.0 55.8 53.2 49.4 49.5 49.2 49.6 51.1 49.5 46.2 48.5 46.7 45.0 45.6 45.4 45.5 44.4 43.0 40.1 45.7 42.8 37.9 36.2 33.7 22.4 12.9 46.4
Source: DIY Week analysis of fi led company accounts. Average excludes Stewarts and Garsons.
www.diyweek.net
-4
year 58.9
56.9 49.5 50.4 49.5 49.4 49.9 52.0 47.0 46.8 47.3 47.2 43.3 46.7 45.9 46.2 44.2 45.3 38.1 21.0 41.1 37.9 35.7 34.5 25.2 10.6 45.2
T
he most signif- icant thing to emerge from this chart is the obvious one: that garden centre
margins are holding up very well. The majority of the garden centre operators covered by this survey recorded a higher gross margin in their latest accounts than they did four years earlier. And by the standards of retailing generally, garden centres achieve very satisfactory gross margins indeed. In part, this is attributable to
the industry’s heritage in growing stock. Plant a seed for pennies, sell the plant for pounds – there’s bound to be a healthy mark-up there. The downside, of course, is that it may take several years to realise that profi t, so high gross margin often goes hand in hand with low stockturn.
But we suspect that the other
key to the industry’s strong and consistent gross margin is catering. The coff ee shop makes money all the year round, every day of the week, and regardless of the weather; and the mark-up available on a cup of coff ee or a slice of cake dwarfs that on a bag of compost or a bottle of weedkiller.
Ron Bent’s famous remark that
“I’m not a garden retailer – I’m a restaurateur who sells garden products” was a sound philosophy for the industry when he fi rst said it, and it still is today. A word about the averages in this
table: most companies state gross profi t in their accounts simply as the diff erence between buying price and selling price. A few companies load the ‘cost of sales’ line with other costs as well as the cost of goods for resale; it’s perfectly legal and reasonable, but it has the eff ect of artifi cially depressing their gross margin. Stewarts and Garsons both appear to have followed this policy, so we have therefore excluded them from the calculated annual averages.
DIY WEEK GARDEN MARKET SUPPLEMENT 9
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