Merchants
Experience Tougher Trading
The UK Builders & Plumbers Merchants market was worth
an estimated £12 billion in 2006 and is forecast to grow by around
4-5% per annum over the 2007-10 period, according to the 9th edition
of the “Builders & Plumbers Merchants Market – UK 2007”, recently
published by AMA Research.
The report, which is available
for purchase at £625 reviews the Merchants market in the UK,
providing comprehensive analysis of the structure of the market and
Merchants’ role in key building product sectors. The report
examines the leading Merchant companies in terms of market share and
examines changing characteristics of the Merchants’ markets such as
profitability and debtor levels. The report also examines Merchant
share and importance in the distribution mix for key product sectors
including roofing, bricks/blocks, plumbing & drainage materials,
etc. In addition, the report includes forecasts of market prospects
to 2010.
The
Merchants’ market has experienced only moderate growth 2005-06
compared with the buoyancy of the market 2000-04, mainly due to the
marginal slowing of the construction market and the reduction of
refurbishment and improvement activities, particularly in the
domestic sector. The consolidation of the market in terms of
suppliers has continued with the leading national Merchants
continuing to take share from other Merchant groups. However, the
rate of share gain for the nationals has been slower 2005-06 than in
previous years. Acquisitions remain a key feature of the market but
the focus has been on widening the range of Merchant activities with
vertical integration policies resulting in timber engineering
specialists, DIY retail, specialist distributors and electrical
wholesalers all added by various organisations over the last 2-3
years.
A number of external influences
have also had a key impact on the growth of the Merchants’ market
over the last 2-3 years. Raw materials prices have continued their
upward progression with sectors such as timber, copper and steel all
affected by increased global demand, resulting in product shortages,
delayed orders and postponement of the completion of some projects.
Fuel and energy prices have also been key contributors to increasing
Merchant costs, resulting in increased pressure on prices and
margins.
AMA’s report also provides an
insight into the future prospects for the Merchants’ market with
indications of moderate-good value growth to 2010. Likely
constraints on future market growth include the level of government
funding for major public sector construction projects and continuing
pressures on consumers’ disposable income that may lead to the
deferment of some domestic refurbishment/extension projects. The
report also indicates some positive aspects that could have a much
brighter influence on the Merchants market including the continued
enhancements to Building Regulations, media programmes such as the
Decent Homes initiative and the expected boost for
construction and refurbishment from the 2012 Olympic Games.
The “Builders & Plumbers
Merchants Market – UK 2007” published by AMA Research is
available in electronic or hard copy format and can be ordered
online at
www.amaresearch.co.uk
or by calling 0871 3103450.
