UK gardens continues to grow
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The UK garden retail sector is in a positive place in 2017 with prospects for further growth ahead across most sectors says Matthew Appleby, Deputy Editor of Horticulture Week.
UK retailers have had to work harder when looking at their international sourcing since the vote to leave the EU on 23 June 2016. The fall in sterling that followed Brexit meant price rises of 10-15% on many manufactured products this year, and retailers are shopping around to make sure they do not have to take more hits to their margins or have to make more price increases to their customers in the future. The domestic garden leisure market is mature, with high household penetration levels, and volume growth is likely to be moderate in the short to medium term. However, the £940 million domestic garden leisure market is forecast by AMA Research to grow by 3-4% per year from 2016/17 to 2021.
The garden retail sector has not been immune to the growth of online shopping. Between 2011 and 2015, online sales of garden products more than doubled, with the sector growing by an estimated 24% in 2015 and the AMA Internet Garden Market Report - UK 2016-2020 analysis said it expects that by 2020 online shopping will account for more than 18% of the total garden products distribution market.
This does not mean however that traditional formats are in decline. Leading garden centres Dobbies and Wyevale are owned by private equity investors, and buying assetbacked alternative investments that confront internet retailing by offering a more pleasant retail environment than the high street are a reason why funds are showing more interest in the garden centre sector. This was shown this spring by alternative real estate investment manager Newcore Capital Management buying Yarnton Nurseries near Oxford for £10.3 million.
So with new City fund money in the sector and a new online market looking set to boom, as well as some growth in the traditional garden market, the UK remains a good place to target for international brands.
2,3000 number of garden centres and retail nurseries (Source: HTA)
£5 billion UK Garden market value 2016, excludes landscaping and amenity sectors (Source: HTA)
£1.4 billion spend on plants (Source: HTA)