Friday, November 07, 2014

Slow but steady growth forecast in the UK Electrical Accessories Market

The electrical accessories market is estimated to be valued at just under £1.5bn in 2014, according to a new report from AMA Research. The market has seen growth of 16% since it bottomed out in 2009 and is now only 7% below its peak in 2007.

Although the difficult economic situation impacted negatively on market value between 2008 and 2010, a substantial rise in raw material costs inflating prices and offsetting low demand, coupled with modest improvements in the economy and growth in the construction market resulted in 10% market growth in 2011. While the market declined in 2012, signs that the economy was improving started to appear in 2013, housebuilding picked up and in addition, the electrical accessories market continued to be supported by major public sector projects, committed to prior to cuts, and as a result the market saw healthy growth in 2013.

The electrical accessories market, according to AMA’s definition, is dominated by low voltage cable systems with value share of over 50%, followed by circuit protection with around a quarter of the market and wiring accessories, which accounted for the remainder. As the electrical accessories market is mature, the product mix has remained fairly stable in recent years.

Raw material prices play an important role in determining market performance for electrical accessories, with the price of cable in particular being highly dependent on copper prices. These have fluctuated widely in recent years. Legislation on energy efficiency and carbon emissions as well as volatile fuel prices has seen interest in, and use of, integrated systems spreading into the wider domestic and light commercial markets to provide greater control for heating, lighting and all electrical systems.

Activity at supplier level during the recession has been focused on consolidation, rationalisation and cost cutting exercises, with many taking the opportunity to integrate earlier acquisitions, streamlining purchasing processes and even repositioning their businesses.

As the electrical accessories market is a mature and sizeable market, recovery will be relatively slow and steady. However, market value is expected to surpass its 2007 peak level by 2016. Pressure on pricing is likely to remain a key aspect of the market for some time. The current focus on solutions and systems within the electrical products market will continue to lead to demand for integrated systems in both the domestic and commercial sectors in the medium term, as well as an increased use of pre-fabricated wiring assemblies and wireless switches.

The demand for environmentally friendly products continues to be a major issue and this is a factor which is likely to be more influential in future years, as homeowners and business operators alike, use whatever means they can to improve the environmental credentials of their properties. This will lead to increased use of individual and central controls for lighting and other electrical products, perhaps creating demand in the electrical accessories sector.

Product development will continue to focus on environmental efficiency, wireless systems, integrated controls, reduced space and impact, quick installation such as prefabricated units and low installation application such as plug and play connections to reduce time on site and cut ‘down time’ during RMI situations.

“Current forecasts indicate annual growth rates of 5-6% from 2015 as the economy improves and house building activity increases” said Keith Taylor, Director of AMA Research. “It is expected that the market value will be around £1.8bn in 2018. However, this will depend on the speed of economic recovery and any fluctuations in raw material prices.”

The ‘Electrical Accessories Market Report - UK 2014-2018 Analysis’ report is published by AMA Research, a leading provider of market research and consultancy services within the construction and home improvement markets. The report is available now and can be ordered online at or by calling 01242 235724.

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