INDUSTRY COMMENT: YEAR IN REVIEW
SO IS THIS THE NEW NORMAL? Mike Smith
Head of Commercial, EFG Housewares
However, we have seen a large squeeze on margins following multiple price increases from suppliers, and that coupled with wage increases for our 100 staff members it remains a tough picture as, for obvious reasons, we are unable to pass these costs on.
From Covid-19 to war, to the rudderless Government to our own geographical issue of ULEZ, I have no idea what the industry or economy or world is supposed to look like or even feel like now. Fortunately we have historically been sheltered from peaks and troughs - due mainly to the nature of the products we sell and the type of clients we serve.
For all the negatives there are of course many, many positives. The change from a regional wholesale business we started in 2017 to a national distributor continues to move at a pace and during this change we have been very fortunate in being able to pick up many housing associations, hotels and local authorities who have been looking for a one stop shop to combine their procurement into one place and because of the vast range we carry they have started trading with us and stayed with us and, at the time of writing, they continue to grow rapidly.
This is, of course, a direct result of the difficult economic climate we find ourselves in and whilst we are very grateful for the business, we are very aware of our responsibilities to offer the best product we can, coupled with the best service and the right price. When I first penned a comment piece back in 2018 our e-commerce division was still in its infancy but it’s a part of the business that has grown and grown and we are absolutely delighted with the continued results, again this does now have challenges that not all our customers see or acknowledge the now massive costs involved of moving product around the country! Our growing E-Commerce client base are happily still very busy and we have been able to enjoy some significant growth in this sector as they are able to take advantage of our now
important Super Sunday weekly promotions and our own brand - Bright and Homely.
Another positive for us is that several of our major suppliers are now key partners on many products we sell so that again emphasises the move from being seen as a cash and carry to a national partner.
But saving the best and ultimately the most relevant for last, our now enormous DIY department that continues to grow and grow at real pace under the guidance of our excellent buyer Aaron and his hugely proactive team ensuring the right products are promoted at the right time - our ‘Super Sundays’ are really made for the DIY division!
I truly hope that the years to come in our industry are a little less tumultuous and wish everyone an amazing Christmas and profitable 2024 and beyond.
CELEBRATING THE SPIRIT OF ENDURANCE AND COMMITMENT Jeff Moody
Commercial Director & Managing Director Bira (British Independent Retailers Association)
First and foremost, let’s celebrate the spirit of the independent retailers in the DIY/hardware
industry and the endurance and commitment during the last 12 months in a market impacted by the consumer
cost of living crisis increasingly dominated by technology, the Independent Retail DIY and hardware industry remains a bastion of creativity and self- reinvention. We could discuss the demise of Retailer names and stock shortages which have plagued sales growth in 2023 or we can focus on the defining features of
MEETING THE CHALLENGES Will Jones
Chief Operating Officer, BHETA
This time last year I predicted that 2023 would be ‘a massively challenging time’ despite new consumers
from pandemic times still pursuing their interest in DIY and gardening, undertaking
14 DIY WEEK DECEMBER 2023
our industry in 2023, which was the rapid integration of technology. Smart home devices, connected tools, and innovative materials are transforming the way consumers approach DIY projects. From smart thermostats to AI-assisted power tools, technology is enhancing both the efficiency and the scope of what can be achieved by DIY enthusiast and Independent retailers have had to change ranges and focus to accommodate these change However, with innovation comes responsibility. Sustainability is a critical consideration in
our industry. As awareness of environmental issues grows, consumers are increasingly seeking eco-friendly and sustainable materials. The DIY and hardware sector is responding by embracing recycled products, energy-efficient tools, and environmentally conscious practices and we are seeing suppliers coming out of the malaise of the last couple of years which have been characterised by massive price increases, labour and stock shortages as well as poor product innovation. Moreover, the rise of
more complex projects and up-speccing tools and equipment. I wasn’t wrong! The cost of living crisis has bitten, and while some of last year’s supply chain issues have eased, the eye-watering levels of inflation – even if they are now decreasing – have impacted across the board. In fact, the single biggest factor in the DIY and garden market in the last year has been the impact of inflation on retail sales volumes,
which have significantly declined year on year: the ONS reported that sales volumes in household goods stores in October 2023 were 12.5% lower than pre- pandemic 2019. It’s been a tough year for any supplier or retailer and the market is forecast by GlobalData to end the year with value sales of £11.725bn, down by -0.5% compared to 2022. Thanks to its partnership with GlobalData and contacts with other data providers, BHETA has
all the statistics reference the detail. The suppression of the housing market continues to dampen key drivers, with many heavy-side renovation projects and big-ticket purchases on hold. On a slightly more positive note, while larger, discretionary purchases such as renovations may be on hold, more essential purchases across this category, such as replacements, appear to be bolstering the sector, and mitigating the worst. In fact, Q3 2023 saw DIY
www.diyweek.net
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