The future lies abroad

It is common knowledge that Germany’s overall DIY market is the biggest in Europe. With sales amounting to close on € 43 bn (v. Graph 1) it nearly attains the combined volume of the second and third national markets (France and the United Kingdom) taken together. However, this figure has been at a standstill since the year 2003. That said, the 20 biggest DIY retailers in Germany have actually seen their sales rise in the past few years, if somewhat slowly. But the 20 big players’ share of total DIY sales has not improved overall. This shows that there is still a certain amount of potential remaining here. The Big Three (Obi, Praktiker and Bauhaus) can indeed claim a 45 per cent share of the Top 20’s sales, but no more than 21 per cent of the market’s total DIY sales. The process of concentration in DIY retailing has gone much further in other countries such as France and the UK. Nevertheless, there have been some changes in the profit margin over recent years. Whereas the figure was between one and two per cent ten years ago, the industry now starts off with a three as the first digit, and major DIY companies are said to have completed the year 2009 with a profit as high as five per cent. Altogether the DIY retailers are more active on an international scale than almost any other trading sector in Germany. Nine of the ten biggest companies are actively involved abroad. Around 25 per cent of these firms’ sales are now effected abroad. This also explains the headlong growth of such companies since 1990 (Graph 2): alongside national elements, it is international expansion factors that play a dominant role here, especially in the case of the big players. The space productivity of the 20 biggest German DIY store operators (national and international) averaged out at € 1 511 in 2009, which is € 46 (-3.0 per cent) down on the 2008 figure. That is the lowest value ever recorded. Even though space productivity in the domestic market, which dropped from € 1 423 to € 1 418, represented a fall of no more than five euros (-0.35 per cent), it was still well below the space productivity of around € 1 860 achieved abroad: a difference of € 442. Download: