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Fuelled by media
attention, the influence of design features from the rest of Europe, an
increasing focus on energy efficiency, a growth in retail outlets
selling radiators and more affordable products entering the mass market,
the radiator has evolved from a functional item in the corner into a
design feature in its own right.
While the overall domestic radiator market is estimated
to be worth over £300 million, the decorative radiator and towel rail
segment was valued at an estimated £65 million at manufacturers prices
in 2005, rising to £70m in 2006.
Defining a
‘decorative radiator’ or ‘towel rail’ is extremely difficult and is
subject to varying interpretations, both in terms of distinctions with
‘standard’ radiators and also in regard to the definition of ‘radiators’
and ‘towel warmers’. As a result, market size assessment can only be
regarded as guideline estimates.
The performance of
the overall radiator market primarily reflects levels of housing
activity and consumer confidence. With home improvement currently a
relatively flat or marginally declining market in overall terms, the
total radiator market performance is similar, although creative and
specialist niche sectors are providing good growth opportunities.
In contrast to
the standard radiator segment which has been struggling in recent years,
the decorative or designer radiator sector is experiencing
impressive rates of annual growth. The segment is seen as still only in
its infancy with further significant growth potential forecast by a
number of industry sources. In total, the decorative/designer segment,
including both radiators and towel rails, is estimated to account for
around 12% share in volume terms and approximately 20% in value terms of
the total radiator market in 2006.
Market growth in
the last 2-3 years has primarily been driven by the towel rail sector
which dominates the market in volume terms. The rapid penetration of
low-cost models via outlets such as B&Q have resulted in lower average
prices, though value growth has continued in the sector due to strong
volume growth.
Designer
radiators have benefited substantially from increasing media exposure
and makeover programmes, as well as rising consumer interest in a
variety of radiator styles, with certain sub-sectors performing better
than others, e.g. contemporary styles. Installers have also become
receptive to the potentially larger profit margins offered by designer
radiators which has been considerable - and the success of the market is
proof that consumers are prepared to pay a considerably higher price for
high quality and ‘different’ products.
The decorative
radiator market has also been buoyed by growing demand in non-domestic
applications. In particular, offices, retail, hotels etc. are all
applications offering potential for better designed products, while
health and education also offer good opportunities for high performance
and LST ranges.
However, in
overall volume terms, it is the towel rail market which has grown
more substantially in recent years reflecting greater consumer awareness
of these products and the wide range now available, suitable for all
types of bathrooms including slim-line products designed for cloakrooms
and en suites. However, as indicated above, value growth has been more
constrained, with average prices driven down by the higher volume of
products sold via the DIY sector. In the ‘mass market’ sector, there has
been an increased focus on more design orientated products over the last
2 years, rather than offering a simple ladder style. Industry sources
believe that there remains enormous scope and sales potential to educate
the consumer on new developments in the heated towel rail market in
terms of materials and designs and, consequently, trade up to higher
value ranges.
Key suppliers
operating in the total UK radiator market include Caradon Stelrad,
Myson Radiators (Rettig) and Quinn Group (Barlo).
These suppliers are cumulatively estimated to have accounted for roughly
80% of UK volume sales. However, the decorative radiator / towel rail
segment is much more fragmented with several leading suppliers including
Zehnder Group, Bisque, Myson, Vogue, Jaga, Quinn,Vasco, MHS,
Kermi, Biasi, Heatline, Masco, Stelrad, The Radiator Company, Imperial
etc. It should be noted that there is a larger proportion of imports in
the decorative segment and a larger number of smaller specialist
suppliers servicing the sector.
The majority of
decorative radiators are distributed through plumbing / builders
merchants with a small proportion distributed through wholesalers,
bathroom specialists and the “direct” channel. However, DIY multiples
are far more important for the sale of towel rails than for decorative
radiators and have been a major contributing factor to market growth in
the last 3 years.
Future prospects
for the overall decorative radiators sector and towel warmers are
relatively optimistic. The sector is forecast to continue showing
substantial rates of growth in the medium term. In terms of radiators,
the growth trend will be boosted by increasing emphasis on the designer
segment by both homeowners and specifiers in upmarket non-domestic
applications. Underfloor heating is experiencing a very similar growth
pattern and reflects greater awareness and interest in heating systems,
greater exposure in the media, and further expansion in the
contract/commercial sector. Some industry sources believe that the
sector could witness annual growth rates in volume terms of up to 10%
per annum for the foreseeable future.
This growth could
be further boosted by the fact that many UK consumers first installed
central heating in their homes in the 1960s and 1970s, which will now be
coming up for renewal and refurbishment offering huge potential for
decorative radiators. This, combined with growing awareness of energy
efficiency and performance are key drivers for the market and should
underpin further growth in the medium term.
In both the
designer radiator and towel rail sector, an important factor for the
future will be branding to create greater product differentiation in the
sector. The market is predicted to become even more competitive with an
increasing focus on unusual designs to meet consumer demand for new
styles.
Another factor for
the future will be the use of new materials for designer/decorative
lines. Alongside the traditional use of steel, other materials to impact
upon the segment will include glass, composite stone and resin and
aluminium.
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