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The DIY market in the UK continues to exhibit the same high levels of growth which have characterised recent years
Escalating house prices, a buoyant economy and the fashionableness of home improvement are offering good sales and profits for the UK’s leading DIY retailers. Annual growth of 7.4 per cent is forecast for this market, which is worth 19.8 bn euro, in the years from 2001 to 2005.
A two-storey Warehouse is being tested by B&Q in Sutton, London.
The hectic pace of mergers and acquisitions of the past two years has slowed down, allowing retailers to consolidate their positions, experiment with new formats and, in some cases, develop overseas operations.
Speculation was strong in the early part of the year that Focus and Homebase would go for a stock market flotation. Focus did indeed announce in April that this was precisely its intention, but delayed flotation because market conditions were unfavourable. Homebase has also confirmed that it has no immediate plans to become a plc.
B&Q remains the market leader by a considerable margin, with 319 stores and sales of just over three billion euro. Its opening programme is also larger than other retailers’, suggesting that its market lead is likely to increase still further in the coming years. This year the company is opening 20 new stores, 15 of them in the large scale Warehouse format. The company has only recently revised its target upwards: to 175 Warehouse outlets by 2006.
B&Q is also alone among UK retailers in having a significant overseas operation with stores in Taiwan (14) and China (7). This year it also made a successful entry on the market of the Republic of Ireland. The new Warehouse outlet in Dublin is by far the largest DIY store in Ireland and throws down a serious challenge to the other retailers.
This year B&Q has been trialling new store formats. Its Warehouse in Sutton, London, is the company’s first two-storey outlet. The design is intended to allow all the benefits of Warehouse stores in locations with limited space availability. Also being tested is a smaller Warehouse format combining elements of the Supercentre and of the Warehouse stores. The first of these opened in Wales during this year.
B&Q is not the only retailer to be experimenting at present. Homebase, in third place in terms of sales (1.9 bn euro) and store numbers (300), is now trying to appeal to a different type of customer. In contrast to the hard-edged Warehouse concept aimed at the DIY enthusiast, Homebase is targeting the aspirational consumer who is more interested in soft furnishings and décor ideas. The company already claims to have more female customers than any other store.
Homebase has this year installed mezzanine display areas in ten of its stores. These new areas are designed for the display of new ranges of bedding, bathrooms, furniture and soft furnishings. The company is increasingly adopting a department store feel and is renting out more concessions to other retailers, who operate as “shops within a shop” selling ranges such as kitchens, furniture or electrical products.
Homebase appears satisfied with the sales growth achieved in its mezzanine stores and now says that up to half of its stores could be converted to this format.
At Focus Wickes the year has been one of consolidation. With 427 stores the company, which was formed by the merger of the old Focus, Do It All, Great Mills and Wickes businesses, has the greatest number of outlets. Last year saw the opening of a new Focus Wickes Warehouse in Glasgow, which the company describes as a great success. This approach makes Focus Wickes the only competitor to B&Q in the Warehouse sector – although even if the company realises its ambition to open ten Warehouse stores over the next four years, it will remain a much smaller scale operation than B&Q.
Industry observers eagerly await the arrival of overseas operators in the UK. The American giant Home Depot is the name most frequently mentioned, and their arrival has been anticipated for at least the last ten years!
Great Britain
Population: 60.1 mio
Area: 245 000 km²
Rate of inflation 2001: 0.7 %
Rate of unemployment 2001: 5.1 %
Gross domestic product 2001: € 1.66 bn
Real change to GDP 2001: 2.3 %
(pdf- download )
DIY in Europe 11-12/2003
A two-storey Warehouse is being tested by B&Q in Sutton, London.
The hectic pace of mergers and acquisitions of the past two years has slowed down, allowing retailers to consolidate their positions, experiment with new formats and, in some cases, develop overseas operations.
Speculation was strong in the early part of the year that Focus and Homebase would go for a stock market flotation. Focus did indeed announce in April that this was precisely its intention, but delayed flotation because market conditions were unfavourable. Homebase has also confirmed that it has no immediate plans to become a plc.
B&Q remains the market leader by a considerable margin, with 319 stores and sales of just over three billion euro. Its opening programme is also larger than other retailers’, suggesting that its market lead is likely to increase still further in the coming years. This year the company is opening 20 new stores, 15 of them in the large scale Warehouse format. The company has only recently revised its target upwards: to 175 Warehouse outlets by 2006.
B&Q is also alone among UK retailers in having a significant overseas operation with stores in Taiwan (14) and China (7). This year it also made a successful entry on the market of the Republic of Ireland. The new Warehouse outlet in Dublin is by far the largest DIY store in Ireland and throws down a serious challenge to the other retailers.
This year B&Q has been trialling new store formats. Its Warehouse in Sutton, London, is the company’s first two-storey outlet. The design is intended to allow all the benefits of Warehouse stores in locations with limited space availability. Also being tested is a smaller Warehouse format combining elements of the Supercentre and of the Warehouse stores. The first of these opened in Wales during this year.
B&Q is not the only retailer to be experimenting at present. Homebase, in third place in terms of sales (1.9 bn euro) and store numbers (300), is now trying to appeal to a different type of customer. In contrast to the hard-edged Warehouse concept aimed at the DIY enthusiast, Homebase is targeting the aspirational consumer who is more interested in soft furnishings and décor ideas. The company already claims to have more female customers than any other store.
Homebase has this year installed mezzanine display areas in ten of its stores. These new areas are designed for the display of new ranges of bedding, bathrooms, furniture and soft furnishings. The company is increasingly adopting a department store feel and is renting out more concessions to other retailers, who operate as “shops within a shop” selling ranges such as kitchens, furniture or electrical products.
Homebase appears satisfied with the sales growth achieved in its mezzanine stores and now says that up to half of its stores could be converted to this format.
At Focus Wickes the year has been one of consolidation. With 427 stores the company, which was formed by the merger of the old Focus, Do It All, Great Mills and Wickes businesses, has the greatest number of outlets. Last year saw the opening of a new Focus Wickes Warehouse in Glasgow, which the company describes as a great success. This approach makes Focus Wickes the only competitor to B&Q in the Warehouse sector – although even if the company realises its ambition to open ten Warehouse stores over the next four years, it will remain a much smaller scale operation than B&Q.
Industry observers eagerly await the arrival of overseas operators in the UK. The American giant Home Depot is the name most frequently mentioned, and their arrival has been anticipated for at least the last ten years!
Great Britain
Population: 60.1 mio
Area: 245 000 km²
Rate of inflation 2001: 0.7 %
Rate of unemployment 2001: 5.1 %
Gross domestic product 2001: € 1.66 bn
Real change to GDP 2001: 2.3 %
(pdf- download )
DIY in Europe 11-12/2003
