YEAR IN REVIEW: INDUSTRY COMMENT


How was 2017 for you? “DESPITE CHALLENGING CONDITIONS,


We talk to leading industry figures for their take on the past year and how their respective sectors have fared, as well as a look to 2018.


2017 ENDED ON A HIGH”


Garden Industry Manufacturers Association


director, Vicky Nuttall offers her take on how the year has been for the industry and for the association’s members: “As Brexit continued to dominate the news headlines, 2017 provided plenty of challenges for GIMA members. With a greater level of support being made available to members, closer collaboration with other organisations, and increased engagement with core members and retailers, the association remains optimistic as we look ahead to 2018.


For our members, 2017 ended on a high, despite challenging


trading conditions, poor exchange rates, and rising cost bases. Implementing price increases has been by far the biggest issue for members – with conversations driven by margins continuing into 2018. Our annual GIMA Barometer of Trade showed members experienced a 4-5% increase in freight and labour costs, with an alarming 17% average increase in landed rates across the board. But the report also showed that our members remained resilient throughout the year, with the majority of respondents expecting some form of improvement. Pack sizes, packaging design and POS were all pushed to the limit in order to boost value and protect margins,


whilst innovation became more keenly focused on current trends. Fertiliser and chemical producers


were especially successful in targeting a recent increase in demand for houseplants, with timely launches of innovative new products ensuring retailers could present as relevant an offering as possible. Stable membership and diversification allowed us added insight into a much wider range of garden retail sectors in 2017, matched by a growing network of retailers who are keener than ever to work more closely with suppliers as they look to have more influence on the supply chain.


2018 is shaping up to be another interesting year of events starting


in February, with many GIMA members looking forward to a second year of discounted space at the now GIMA/HTA owned Garden Press Event, and others taking advantage in a shift in buying patterns exhibiting with Glee at Spring Fair. We’ll need to see how suppliers continue to deal with challenges of Brexit, and will provide as much help as is at our disposal. The focus must remain on supply chain efficiencies as we continue to deal with inflation, but all in all we go into the new year with a great deal of determination and optimism. Merry Christmas and Happy New


Year to all DIY Week readers, look forward to seeing you in 2018.”


“CHALLENGING TIMES BUT DYNAMIC GARDEN CENTRE SECTOR CONTINUES TO INNOVATE”


Gilbert Evans


partner Allen Evans rounds up the year


for the UK garden centre sector: “Generally, 2017 has seen a


strong trade performance from garden centres, with some reporting 10%-plus growth year on year. However, the latest reported figures from both Dobbies and Wyevale, paint a different picture for the two largest players. Operators will be crossing their fingers for a successful Christmas trading period to cap off another strong year. Trading on the high street has been far more challenging as retailers continue to face the challenges of online competition and ongoing economic uncertainty.


The volume of freehold garden


centre sales has been slightly lower in 2017 but this is not down to weakened demand. Strong sales for the fourth year running have meant that operators have had their heads down. Demand remains strong with the lack of


10 DIY WEEK 15 DECEMBER 2017


supply continuing to underpin values. Value hinges primarily on trading performance, with the potential to improve turnover an important factor. Most of the groups remain in the market to acquire new centres with leaseholds, forming part of the solution for expansion. With greenfield sites scarce, a new approach to development/ leasing/investment has been demonstrated this year at Bridgford Garden Centre, Nottingham. Blue Diamond has taken out a 35-year lease to operate its 20th centre, a new- build 140,000sq ft garden centre, with the site owner becoming the landlord investor. An example of a creative solution resulting in far greater rewards for both parties, which could provide a template for other operators. Transactions have included the sale of Yarnton Garden Centre to new sector entrant New Court, the Dorney Court lease assigned to Crocus marking an interesting move from


a significant online retailer with Woodborough Garden Centre acquired by Whitehall and Abbey Garden Centre moving into Stewarts portfolio.


At Dobbies, Nicholas Marshall’s appointment is hoped to ‘be a shot in the arm’ for the group which has been lacking in retailing flair in recent years. The CEO has also confirmed an appetite for further expansion of Dobbies’ portfolio. He has also introduced a significant number of very experienced former Wyevale colleagues to support his ambitious plans.


The Wyevale rumour mill has


recently been working overtime. Its acquisition trail is on hold. No other group has ever experienced such a ‘churn’ of senior management, reflected in its trading figures. Recent press comment hints that there may be a change in ownership whilst other industry observers suggest that Wyevale would benefit from a period of stability to concentrate on its customer focus. Investment


in the group’s website offering and click and collect is an indication of its future offering.


Larger independents continue to innovate, pioneering new concepts in tandem with their very successful garden centres. Barton Grange is developing its £8million multi-purpose leisure centre that will include a curling rink, ten pin bowling, a three-screen cinema, an all-weather Crazy Golf course and two golf simulators. Two restaurants including a fish & chip restaurant completes the new offer.


So, what’s in store for 2018?


Predictions are for a potentially more challenging year with Brexit uncertainties, interest rates, inflation and business rates all looming large. These major question marks make business decision-making challenging but the garden centre sector is a dynamic one and it will continue to innovate and invest to ensure it captures positive customer sentiment at every opportunity.”


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