INDUSTRY COMMENT: BHETA
BHETA INTRODUCES ITS QUARTERLY MARKET REPORT
BHETA is the leading UK Trade Association for manufacturers, importers, and distributors who operate in the home improvement and garden sectors. Will Jones, Chief Operating Officer of BHETA, the trade association that represents many of the home improvement, DIY, garden, and homewares suppliers in the UK, comments on the challenges posed to the industry due to the current cost of living crisis.
everything from casual conversation to in-depth media reporting, it over- simplifies a far more complicated picture of how UK plc and specific market sectors are really performing as we move in 2023. Fortunately, thanks to BHETA’s Quarterly Market Report - which centres on category reporting from GlobalData as well as information from a wide range of published sources, and then combines that with real-time comments from leading suppliers and retailers, that complex picture is something the BHETA team can not only interpret, but also provide regular advice upon. In fact, members tell us how very useful they find the report not only in helping their understanding of the markets in which they operate, but also in benchmarking their businesses against the sector performance. From a DIY perspective, the most
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recent BHETA Quarterly Market Report, which is available free to BHETA supplier members four times a year, and to retailers in the sector, reveals the complexity of current trading, but with an overall feeling of cautious optimism for the coming year.
Joseph Robinson, Consulting Director at GlobalData says: “The DIY
hile ‘cost-of- living crisis’ must currently be one of the most frequently used phrases in
category fell back in the second half of 2022, owing both to the significant investment many have already made in their homes through the pandemic, and consumers tightening their household budgets and refraining from non-essential in sub- categories such as decorative DIY.” Unsurprisingly therefore, following the record highs of 2021, this last year has been tougher for many in the home related retail sector. The global energy crisis, war and inflation have made converting consumer interest into sales that much more difficult – but not impossible.
Recent positive performances from
both retailers and suppliers over autumn and winter have brought into question the previously wholly negative predictions of recession from parties such as the Bank of England. It is a fact that there are categories in growth, both in terms of sales and consumer Google searches. All things energy saving and sustainable such as loft insulation, draught excluders, LED bulbs are all performing well. Water butts are also in growth as consumers start to understand the impact of climate change on rainfall. The volumes of UK consumers
searching on Google in many home- related categories is healthy when compared to 2019, and there are many categories showing growth in the number of Google searches during 2022 versus the previous year, including DIY & gardening, pipe cutters, solar panels, water butts, LED bulbs, loft insulation and draught excluders. The real time situation is that while there is less disposable income to spend, there are now more
people
interested in these categories than pre-pandemic. “To summarise, consumer interest in the sector is still very noticeable. It
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is all about improving homes and making life better, and suppliers and retailers are seen to have a role to play in helping people create better safer places to live,” comments Jones. Unsurprisingly therefore, we
are seeing several initiatives from launching new everyday value ranges, to innovative products to energy saving services entering the market. To quote Thierry Garnier of Kingfisher, “Rising energy bills have led to a surge in customer interest in energy efficiency this year and that’s a trend we expect to continue into 2023 and beyond.” BHETA supplier members are saying much the same: “Contrary to what many of us considered would be a rapid decline [in the DIY Market] in 2022, that monumental dropping off a cliff, hasn’t occurred. It would be naïve to say that we shouldn’t prepare… and that is where diversity is important.” Steve Ross, Commercial Director for Avocet ABS division. Rythm Jain Saigal, BHETA’s
President, and also from Avocet added on gardening: “There is cause for cautious optimism in 2023. Trends such as gardening sanctuaries and sustainability will feature highly.” Jason Burns, Managing Director of Shurtape says: “Despite the media gloom, Shurtape traded really well in 2022 and we had a fantastic fourth quarter. January has seen a slower start, but it’s very early days and our order book is strong. We expect growth again this year with a stronger second half. Being able to predict trends like that is one of the reasons we find the BHETA market report useful and recommend it to retailers and suppliers alike.”
Jones adds: “Of course, it’s true to say that value was a huge motivator during this period. Kantar market share data for the period covering Christmas showed that inflation drove up customer spend by £1.1bn but pushed volumes down by 1%. Despite the boost to the top line that some retailers experienced due to inflation over the festive period, most are just as desperate as customers to
see the figure come down. There was also a halo effect from opportunities like Black Friday and the World Cup. BHETA insights suggest that so-called Red-Letter Days remain major opportunities as long as quality combines with considered purchase from a value-for-money perspective. “Customers also continue to prioritise ease and so, for retailers, making it as convenient as possible for customers to shop needs to remain a priority. Three in four consumers are looking for home improvement projects to be faster and more affordable, while also expecting a frictionless retail experience – and it is the supplier’s and retailer’s job to meet those needs.”
“In conclusion,” says Jones, “2023 is likely to hold significant challenges, but it is important to note that the predictions include nothing like the scale of GDP declines seen in previous recessions – which should still give suppliers and retailers conditions in which they can make money - albeit growth will be harder to achieve. “There are still many positives in the wider economy: during the pandemic those fortunate enough to remain in work with average and above incomes saved record amounts of money which will provide a welcome reserve for many households; unemployment remains low; petrol prices are coming down and inflation is likely to have peaked; the volume of construction in recent months has hit record highs; and both the pound and consumer confidence have been strengthening since September.
“Many BHETA members report a welcome up-tick in business during the Autumn. Long may that continue into 2023!” For a free copy of the BHETA Quarterly Market Report retailers can contact
info@BHETA.co.uk. Suppliers can also contact
info@BHETA.co.uk to discuss membership opportunities. For more information about BHETA, BHETA events and BHETA services, contact the BHETA Member Services team on 0121 237 1130 or visit the BHETA website at
www.bheta.co.uk.
JANUARY 2023 DIY WEEK 25
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