Belgium and the Netherlands have performed particularly well in
the period 2004-2008, with France also progressing well. The
German builders merchant market, serving a struggling construction
market, has not progressed strongly, though with more growth seen
in 2006-2008 as the German economy and consumer confidence showed
stronger signs of recovery. In the UK, market development has been
volatile, with strong growth in 2004-07, before a relatively
strong decline in 2008 compared to other key markets.
In terms of the overall builders merchants market within the EU,
there are various estimates of market size. AMA estimate the
market in the EU to be worth around €138 billion (Euros) in 2008
equivalent to around £120-125 billion (Sterling), depending on
exchange rates. 2009 Is likely to result in a decline in all
markets, with new housing badly affected in all countries. RMI
work typically depends on consumer confidence which is relatively
fragile across all major European economies, while non-residential
construction is also under pressure reflecting financing
constraints.
This report includes an analysis of the builders merchants markets
in Germany, France, Belgium/Netherlands and includes a review of
the differences in structure of the respective countries,
highlighting overall market sizes, key market trends, major
suppliers and distribution issues.
Since the last edition of this report, the structure of the
markets under review has continued to change. Three key
multi-national groups remain significant in these markets - Saint-Gobain,
whose Building Materials Distribution division claims to be the
European leader in building materials distribution, Wolseley plc,
the UK based company which claims to be the world’s largest
specialist trade distributor of heating and plumbing products and
CRH, the Irish building materials group.
In 2007-08, there has been significant activity among buying
groups with acquisitions and mergers within national boundaries,
as well as pan-European links being developed to combat the growth
of the major groups. The role and scale of independents varies
between the different markets, but one market to stand out as
highly fragmented is Belgium which constitutes a very large number
of independents with no large international company dominating the
market in comparison to France, for example.
In the future, the four markets under review are likely to see
further rationalisation over the longer term, though the major
international groups are suspending their acquisition programmes
in the short term. Alongside structural changes in distribution,
the markets are also likely to see increased concentration of
supply as large groups seek to rationalise supply structures. The
European building materials market has become increasingly
concentrated with the emergence of more pan-European groups in
most key sectors, though companies still continue to develop
concepts and products which can fit into the national markets in
which they operate.
This report reviews the supply trends in each of the markets,
illustrating the current position of the leading merchants and
identifying areas of potential change in the future, while also
reviewing key factors influencing product trends.
