UK DIY & Gardening Retailers 2012

The UK DIY & Gardening Retailers 2012 report provides a thorough analysis of the currently challenging DIY & gardening market. With sales growth hard to achieve, we examine strategies retailers can use to come out of the downturn stronger. We also provide comprehensive analysis of the market, and the major players in the sector.

Features and benefits

• Benchmark your performance against competitors and the overall market
• Gain a greater understanding of your competitors performance and develop strategies to exploit weaknesses in their offer
• Use the strategies for success Verdict has identified in the DIY and gardening market to protect and grow your business

Highlights

While slower than 2011, we forecast that the DIY & gardening market will contract again in 2012, shrinking by 1.9%. The main factors behind this remains the weak housing marrket and tight disposable incomes. The market remains divergent, with gardening, which is supported by events and a more frugal customer, 1.5% up in 2012 while DIY is 3.6% down.

Between 2007 and 2012, grocers and general merchandisers have taken the greatest share of the DIY & gardening market, gaining 2.7 and 1.5 percentage points of share respectively over the period. Both have benefitted from targeting a less affluent customer base and having higher levels of convenience.

As sales growth will be tough in the current environment, retailers should focus on protecting margins and developing their offer to come out of the downturn stronger. Opportunities to grow sales include creating a compelling offer for older customers, who are more likely to own their own home, developing online and engaging with customer trends.

Your key questions answered

• Which product and customer sectors are set to be the most buoyant during this challenging period?
• How has the collapse of Focus impacted the market? Who has benefited the most from the former specialist's exit?
• What do we forecast for Garden Centre Group following its recent sale?
• How are non-specialists gaining a greater share of the market?

Table Of Contents

EXECUTIVE SUMMARY
Key findings
(Untitled sub-section)
Main conclusions
DIY & gardening market decline set to slow
Gardening still outperforms depressed DIY
Garden Centre Group poised for sale amid garden consolidation moves
Remaining Big Three gain share
Sourcing and own label key to building profits
Home ownership trends shift market to over 45s
Dangers in widening garden centre ranges too much
Gaps in online offers
Wickes leads way in major space reduction
Non-specialists advance further
Green and stay at home trends still positive

OUTLOOK
Key Issues
Who are the future DIY customers?
(Untitled sub-section)
Strategies in a low demand market
Margin improvement becomes essential
Engaging with consumer trends
Grow your own trend continues
Non-specialists advance in garden sector
(Untitled sub-section)
Garden centres add to lifestyle appeal
(Untitled sub-section)
Online development
Many products still not available for online purchase
Location strategy
(Untitled sub-section)
Competitive positioning
(Untitled sub-section)
Summary and strategies for success
(Untitled sub-section)

MARKET ANALYSIS
Market Definition

OVERVIEW
Decline slows but market still tough
Gardening lifts sector
Inflation trend including VAT
and excluding VAT
DIY
(Untitled sub-section)
DIY sales excluding VAT
Gardening
(Untitled sub-section)
Gardening sales excluding VAT
Channels of distribution
(Untitled sub-section)

DIY SUPERSTORES
(Untitled section)
Sales including VAT
Space
Stores
DIY superstores sales excluding VAT

COMPANY DATA ANALYSIS
Most players will benefit from share ceded by Focus – except builders merchants
Operating statistics
Key financials and space data of major players
Space allocation
DIY & gardening retailers
Gardening specialists
Advertising spend
Top Three all raise spend in 2010

B&Q
Reinforces position as DIY sector leader
Recent key events
Focus on efficiency and improving proposition
Proposition
Financials
Poor big ticket sales lead to further slowdown
Operating margin improves slowly
Space
Former Focus stores create growth
Space allocation
Market share
Outlook
Scale matters in tough market
Benefits from disappearance of Focus

HOMEBASE
New services, ranges and store formats
Recent key events
Aims to drive sales with improved offer and services
Proposition
Financials
Cost cuts help profits in 2010/11
Space
Reduced space helps to cut costs
Space allocation
Sector performance
Falls further behind market leader B&Q
Outlook
Moves further upmarket in difficult environment

WICKES
Online growth prompts radical review of stores
Recent key events
Cuts store network significantly
Proposition
Financials
Kitchens & bathrooms sales up in 2010 and slide in 2011
Space
Focus acquisition boosts portfolio
Space allocation
Market share
Outlook
Radical approach to store needs

SMALLER DIY SPECIALISTS
Robert Dyas
Looks for new owner to invest in expansion
Market share
Outlook
Tile Giant
Expansion rate slows
Market share
Outlook
Topps Tiles
Trading takes a tumble
Market share
Outlook
The Garden Centre Group
Diversifies product range
Recent key events
Proposes giving up lease on Beverley garden centre
Buys Country Homes and Gardens
Pushes against trading restrictions
Sale may be imminent
Adds 30 pet centres and clothing sections to its stores
Proposition
Financials
Space
Space allocation
Market share
Outlook
New ownership crucial to future
Product diversification likely to take it further away from core categories
Internet needs further development

SMALL GARDEN CENTRES
Sustained by favourable consumer trends
Dobbies
Ambitious expansion plans for 100 centres
Notcutts
Grows by diversifying product ranges
Comparable profit margins fall
Expands Tunbridge Wells centre
Runs pop up shops again
Outlook
Concentrating more on lifestyle appeal

ARGOS
Sales declines continue
Recent key events
Reinforces ranges and convenience
Proposition
Financials
Poor sales continue
Further decline on the cards
Space
Plans to optimise store portfolio
Market share
Outlook
Focuses on multichannel despite sales sliding

WILKINSON
Sales slow as retailer seeks further UK expansion
Recent key events
Revamps and grows store portfolio
Proposition
Financials
Slowdown in sales set to continue
Sales have almost doubled since 2002
Space
Growth in store space slows
Space allocation
Market share
Outlook
Refurbished stores enhance sales but margin remains a problem

GROCERS
Non-food growth slows – including DIY
(Untitled sub-section)
Asda
Share grows as non-food expands
Sainsbury’s
DIY & gardening limited part of non-food
Tesco
Rapidly growing share driven by Direct
Outlook
Advantages in incremental sales and green image

BUILDERS MERCHANTS
Still suffering from the construction downturn
Jewson
Travis Perkins
Wolseley
Outlook
Consolidation under market pressure

APPENDIX
Ask the analyst
Verdict consulting
Disclaimer

List Of Tables

Table: Margin and sourcing strategy among major DIY retailers January 2012
Table: Own brand strategy among DIY retailers, January 2012
Table: Internet features & services offered by DIY & gardening retailers January 2012
Table: DIY & gardening market definition 2012
Table: Consumer spend on DIY & gardening products 2002–12e
Table: DIY & gardening sales excluding VAT 2007–12e
Table: Total consumer expenditure on DIY products 2007–12e
Table: Breakdown of consumer spend on DIY products 2007–12e
Table: DIY sales excluding VAT 2007–12e
Table: Total consumer expenditure on gardening products 2007–12e
Table: Breakdown of consumer spend on gardening products 2007–12e
Table: Gardening sales excluding VAT 2007–12e
Table: DIY & gardening channels of distribution 2007 & 2012e
Table: DIY superstores sales, stores and space 2007–12e
Table: DIY superstores sales excluding VAT 2007–12e
Table: DIY & gardening retailers market shares 2007–12e
Table: DIY & gardening major specialists – UK trading 2010/11
Table: DIY & gardening major specialists – UK stores 2010/11
Table: Summary of space allocation for leading DIY & gardening retailers 2011
Table: Summary of space allocation for leading DIY & gardening retailers (continued) 2011
Table: Summary of space allocation for leading gardening retailers 2011
Table: Major DIY specialists advertising spend 2007–10
Table: Major DIY specialists advertising spend by media 2010
Table: B&Q company information 2012
Table: B&Q retail proposition 2012
Table: B&Q UK key operating statistics 2007–12e
Table: B&Q UK trading record 2002–12e
Table: B&Q UK store portfolio 2002–12e
Table: B&Q DIY & gardening space allocation 2011
Table: B&Q DIY & gardening space allocation (continued) 2011
Table: Homebase company information 2012
Table: Homebase retail proposition 2012
Table: Homebase UK key operating statistics 2007–12e
Table: Homebase UK trading record 2002–12e
Table: Homebase UK store portfolio 2002–12e
Table: Homebase space allocation to DIY & gardening 2011
Table: Homebase space allocation to DIY & gardening (continued) 2011
Table: Wickes company information 2011
Table: Wickes retail proposition 2011
Table: Wickes UK key operating statistics 2007–12e
Table: Wickes UK trading record 2002–12e
Table: Wickes UK store portfolio 2002–12e
Table: Wickes space allocation to DIY & gardening 2011
Table: Robert Dyas UK key operating statistics 2007–12e
Table: Tile Giant UK key operating statistics 2007–12e
Table: Tile Giant space allocation 2011
Table: Topps Tiles UK key operating statistics 2007–12e
Table: Topps Tiles space allocation 2011
Table: The Garden Centre Group company information 2012
Table: The Garden Centre Group retail propositions 2012
Table: The Garden Centre Group key operating statistics 2007–12e
Table: The Garden Centre Group UK trading record 2002–12e
Table: The Garden Centre Group UK store profile 2002–12e
Table: The Garden Centre Group space allocation 2011
Table: Dobbies UK key operating statistics 2007–12e
Table: Dobbies space allocation 2011
Table: Notcutts UK key operating statistics 2007–12e
Table: Argos company information 2012
Table: Argos retail proposition 2012
Table: Argos UK key operating statistics 2007–12e
Table: Argos UK trading record 2002–12e
Table: Argos UK store portfolio 2005–12e1
Table: Wilkinson company information 2012
Table: Wilkinson retail proposition 2011
Table: Wilkinson key operating statistics 2007–12e
Table: Wilkinson trading record 2002–12e
Table: Wilkinson UK store portfolio 2002–12e
Table: Wilkinson space breakdown 2011
Table: Supermarket DIY & gardening market 2005–12e
Table: Top Three grocers latest results 2010/11 and DIY & gardening share 2012e

List Of Figures

Figure: Key Issues in DIY & gardening retail 2012
Figure: Change % in heads of household who are homeowners, in England by age 2010 on 2005
Figure: Heads of households who are homeowners, percentage share by age group 2010
Figure: Next store in Shoreham 2011
Figure: Positioning by age and socioeconomic grouping for major DIY retailers 2012
Figure: Year-on-year growth in DIY and gardening 2002–12e
Figure: DIY & gardening market composition 2012e
Figure: DIY & gardening inflation vs total retail inflation 2006–12e
Figure: DIY category shares of DIY & gardening market 2007 & 2012e
Figure: Gardening category shares of DIY & gardening market 2007 & 2012e
Figure: Change in category shares of DIY & garden spend 2012e on 2007
Figure: DIY superstores sales (current prices) 2010–12e
Figure: DIY superstores space (m sq ft) 2010–12e
Figure: DIY superstores stores 2010–12e
Figure: Market shares of leading channels of distribution 2012e
Figure: Change in market share of leading players 2012e on 2007
Figure: B&Q store fascia 2012
Figure: B&Q mobile transactional website 2011
Figure: B&Q UK sales and growth to January 2007–12e
Figure: B&Q UK operating profit and growth to January 2006–11
Figure: B&Q UK sales density to January 2007–12e
Figure: B&Q's DIY and gardening market share 2007–12e
Figure: Homebase store fascia 2012
Figure: Homebase UK sales (£m) and y-o-y change to February 2007–12e
Figure: Homebase UK operating profit and growth to February 2006–11e
Figure: Homebase UK sales density to February 2007–12e
Figure: Homebase DIY and gardening market shares 2007–12e
Figure: Wickes fascia 2011
Figure: Wickes UK sales and growth to December 2007–12e
Figure: Wickes UK operating profit and growth to December 2006–10
Figure: Wickes UK sales density to December 2007–12e
Figure: Wickes DIY & gardening market shares 2007–12e
Figure: Robert Dyas DIY & gardening market share 2007–12e
Figure: Tile Giant DIY & gardening market share 2007–12e
Figure: Topps Tiles DIY & gardening market share 2007–12e
Figure: The Garden Centre Group – Wyevale fascia 2012
Figure: The Garden Centre Group retail sales & growth to December 2007–12e
Figure: The Garden Centre Group operating profit & growth to December 2007–10
Figure: The Garden Centre Group DIY & garden market share 2007–12e
Figure: Garden centres DIY & gardening sales and growth rate 2006–12e
Figure: Dobbies share of total DIY & gardening 2007–12e
Figure: Notcutts share of total DIY & gardening 2007–12e
Figure: Argos Romford store 2012
Figure: Argos UK sales and y-o-y change to January 2007–12e
Figure: Argos UK operating profit and growth to February 2006–11
Figure: Argos UK sales density to February 2007–12e
Figure: Argos DIY & gardening market share 2007–12e
Figure: Wilkinson store fascia 2012
Figure: Willkinson sales and y-o-y change to January 2007–12e
Figure: Wilkinson operating profit to January 2006–11
Figure: Wilkinson sales density to January 2007–12e
Figure: Willkinson DIY & gardening market share 2007–12e
Figure: Value of grocers DIY & gardening sales and growth rate 2006–12e
Figure: Asda share of the DIY & gardening market 2007–12e
Figure: Sainsbury's share of the DIY & gardening market 2007–12e
Figure: Tesco (excluding Dobbies) share of the DIY & gardening market 2007–12e
Figure: Value of builders merchants DIY & gardening sales and growth rate 2007–12e