Wednesday, February 25, 2015

Local authorities spend almost £1bn a year on street furniture and street lighting

The total market for street furniture, which covers a wide range of end use sectors, is estimated at around £350m according to a brand new report by AMA Research on the street furniture and lighting market in the UK.

The report is focused on the local authorities sector, which is estimated to account for 80% of the market, and covers the supply of a range of products used in public urban locations including: benches & seats, bins, bollards and barriers, planters, posts and rails, cycle stands etc.

In overall terms, the market is split between more ‘routine’ items, which need to be regularly replaced because of damage, and new development projects like town centre regeneration or housing developments where new items will be installed. Bollards/barriers represent the largest sector with a share of around 30%, with benches/seats and cycle stands also accounting for a significant share. Cycle stands are the fastest growing sector reflecting local authorities' response to the growing popularity of cycling among all age groups.

Local authorities have a major influence on choice and specification of product, reflecting their budgetary responsibilities. Products like bollards and barriers are essential items which will be used to manage highway traffic requirements, but other products like planters will be discretionary and primarily used for decorative purposes.

Street furniture is manufactured from a wide variety of materials, which includes stainless steel, cast iron, wood, concrete and plastic. As a result, the supply structure is fragmented with a large number of companies supplying different street furniture products using many types of materials – often providing both bespoke and standard products.

The UK street lighting market is estimated to be worth at least £600 million, with an estimated 8.2 million street lights in total. Around half of the total market is spent on energy, with around a third spent on maintenance and the remainder on new projects.

Around a quarter of all lighting columns in the UK are older than 30 years and, to keep pace with natural deterioration, a significant number of columns need to be replaced each year as a large share of columns are concrete which tends to deteriorate over time.

The street lighting market in the UK is predominantly driven by demand from local authorities or their term maintenance contractors who are the largest purchasers and specifiers of street lighting. Local authorities are responsible for urban street lighting, and the responsible authority will either undertake the work themselves, or more likely employ a specialist lighting contractor on a contract basis or entering into a long term PFI contract.

There is an ever increasing focus on reducing energy costs within this sector and operators are switching to new technologies which offer substantial reductions in energy costs and more sophisticated controls. However, considerable investment is required and there is an increasing involvement by the private sector to provide the investment.

“There has been a move from the public sector maintaining highways towards involvement of the private sector” said Andrew Hartley, Director of AMA Research. “Some 50% of authorities in UK use term maintenance contractors and there has been a steady move towards private involvement.”

Future prospects for the street furniture and street lighting sectors are mixed, reflecting a mix of local authority budget cuts and ongoing demand to improve and upgrade the urban environment.

The Street Furniture and Lighting 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.

Tuesday, February 24, 2015

The UK Panel Builders Market returns to growth

The UK panel builders’ market was estimated to be worth £540 million at manufacturers’ selling prices in 2014. Market growth is driven by a strong performance in specialist sectors, an improvement in private sector construction and a generally more favourable economic climate.

The UK panel builders’ market was relatively stable prior to the recession with growth levels averaging around 1-2% per annum, but declined by more than 15% between 2008 and 2010, reflecting the poor performance of a number of product and end user groups during the recession. However, some sectors were sustained by exports and construction output in the public sector in particular remained strong during this period and was boosted again in 2011 by government spending, ahead of budget cuts.

Factors supporting the market include growth in specialist markets, such as hazardous environments, as a result of tightening regulations, evolution of environmental legislation and investment in development of oil, gas and renewable energy sectors. Factors negatively affecting market growth include public sector spending cuts, rationalisation of manufacturing capacity and increasing competition for projects driving down prices.

Key end use markets include industrial and manufacturing, water and sewage, power generation, oil, gas and marine, construction and transport. Power distribution panels represent the largest product sector at over half of the market value, followed by motor and process controls and building control systems. Safety, security and other panels make up the remainder of the market. Panel builders primarily source components direct from manufacturers, either externally or internally from a subsidiary within the same group.

Product development is primarily concerned with quick installation, reduced maintenance, environmental factors and health and safety, motivating demand for more sophisticated products which can withstand hazardous environments.

Current indications are that the UK panel builders’ market turned a corner in 2014 as private sector construction improved, however, the market is expected to maintain moderate growth levels, reaching an estimated value of £620 million by 2018.

“Refurbishment and development of the power generation asset base will provide opportunities for panel builders as well as focusing on renewable energy generation” said Keith Taylor, Director of AMA Research. Investment in advanced manufacturing and also related R&D in the UK is likely to continue to stimulate investment in capital projects with positive implications for the UK panel building industry in the medium to longer term. Increased focus on infrastructure projects and development in the rail sector is also likely to benefit the sector.”

Factors supporting growth include improvement in the construction industry generally and in the industrial and infrastructure sub-sectors, in particular rail with government strategy to make continued use of ‘cascaded’ modern electric rolling stock and to link these developments in with the HS2 corridor. Other supporting factors include growth in the pharmaceutical / chemical, advanced manufacturing sectors, composites and further development of the IT and datacentre sector stimulating the panel building market. These factors may be balanced by ongoing capital spending cuts in the public sector, though this situation will be determined by the next government.

Health and safety, environmental and energy efficiency legislation is likely to continue to influence long term demand and the continued focus on environmental concerns and the need to reduce operating costs will benefit the automation sector including panels and components.

There has been some increase in outsourcing of part of the panel building manufacture, usually overseas, in order to reduce costs and streamline internal operations. This trend is expected to continue over the next few years as panel builders seek further ways of improving their build efficiencies. Product development has resulted in panels becoming smaller and more streamlined with quicker fit solutions and more standardised components. This is likely to see panels becoming more standard and modular, in turn containing more modular components.

The ‘Panel Builders Market Report – UK 2015-2019 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.

Thursday, February 19, 2015

Annual growth of 4-5% expected in the UK Facilities Management Outsourcing Market

The facilities management market has exhibited good levels of growth for much of the last twenty years, influenced by organisational desires to control non-core operational efficiencies and costs, and a trend within the private sector for companies to refocus their business in order to concentrate on core competencies. In 2014, the market for outsourcing bundled and Total Facilities Management services was valued at almost £19.5 billion.

The deterioration in the UK economy from mid to late 2008 had a negative impact on the development of the overall FM market. Previously the Labour Government’s policy to stimulate economic growth through public sector spending had supported the FM market, though the Coalition’s focus on reducing the deficit removed this stimulant. This market has now returned to more positive growth and is expected to continue to show annual growth, reaching a forecast £23.2 billion by 2018.

The market is considered to be relatively mature across a wide range of sectors. However, there are also newer forms of service which are far from mature – such as energy management, compliance services and workspace management – which, if approached professionally, will broaden the industry’s scope and client base. 

The economic downturn has heightened price competition in the market with end-users seeking better value for money. This has had a negative impact on contract prices and has resulted in lower market values and tighter margins. In addition the climate has led to clients seeking shorter contract lengths and more flexible terms.

The development of the facilities management market has been positively influenced by the trend to outsource an increasing array of services, with a gradual shift towards ‘bundled service’ and TFM contracts, adding to contract values. The corporate market represents the largest end use sector, accounting for more than 50% of the market, with central and local government accounting for around a quarter. Healthcare and education had been the most rapidly growing sector in recent years and now represent 18% of the market, though the growth of this sector has now slowed sharply.

“The impact of public sector spending cuts is not clear at the moment. The Government estates will undoubtedly shrink but our forecasts assume that outsourcing will be viewed as a means of saving costs - more so than an expenditure element to be cut”, said Keith Taylor, Director of AMA Research. “In addition some government cuts in the education sector for example have not led to construction output reductions, as Universities and Academy schools for example appear to have been successful in drawing in private sector investment.”

The key to advancement will be maintaining a high standard of service in core activities whilst adding value by offering enhancements and differentiated services. A key area of opportunity in the public sector is likely to arise within local authorities. This sector retains potential for an increase in the level of outsourcing, which may provide an opportunity to meet cost savings required.

The overall FM market will also continue to benefit from the shift away from single service contracts towards bundled service and total facilities management packages. The trend for private and public sector clients to outsource an increasing number of services, as well as to reduce procurement costs through seeking ‘one-stop-shop’ solutions is expected to continue, adding to contract values and favouring larger facilities management providers which can supply the full range of services required.

The ‘Facilities Management Outsourcing 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.

Tuesday, February 10, 2015

Rising demand for conservatories and glazed extensions in the UK

Following several years of decline, the conservatory market started to recover in 2012/13 and was estimated to be worth around £620m at the end of 2014. A combination of a recovery in the economy in general - and the housing market in particular - have helped underpin rising consumer confidence and spending on higher value home improvements – particularly with interest rates so low. 

Over the last few years, the market has become more sophisticated in terms of product range and offers more options for a bespoke project – options now include conservatories, glazed extensions which might have a solid or a glass roof, orangeries, verandas, loggias etc. Key product features which have become more important in the conservatory market include improved thermal efficiency, high specification self-cleaning glass, coloured frames, bifold opening doors etc.

In terms of frame materials, PVC-U continues to dominate, but timber has a reasonable share and has retained its attraction for many homeowners due to its natural appearance and sustainability credentials. Aluminium remains a more expensive option and while it has retained a niche share in the domestic market, aluminium bifold doors have gained widespread consumer acceptance.

Key suppliers are a mix of national retail brands, local suppliers and specialist conservatory installers. However, in broad terms, the supply structure for conservatories remains very complex and fragmented, reflecting the structure of the replacement window market. The conservatory roof systems sector is dominated by two leading players, both of which have expanded in recent years through acquisition. Consolidation is likely to remain a feature of the conservatory market, though a trend to more bespoke installations provides opportunities for local companies.

Main channels of distributions are replacement window companies, garden centres, DIY outlets, conservatory specialists, builders and online. In the ‘self-build’ conservatory sector, the distribution focus has switched from DIY outlets to online conservatory specialists, who offer a wider range of product options than those offered by DIY outlets.

Market improvement in 2015 and beyond is likely to be driven by an improving house moving market, growing consumer confidence and growth in the retrofit/upgrade market – particularly if interest rates remain at historically low levels. However, substantial increases in volumes or value are not expected in the short–medium term.

Market growth will only be possible if the UK economy sees sustained growth, alongside improvements in the house moving market, disposable incomes, and consumer confidence. 

“In the longer term, our forecasts indicate steady growth, but we do not expect to see a return to the peak volumes achieved in the early-mid 2000s” said Andrew Hartley, Director of AMA Research. “However, work on existing conservatories will become a more important part of the conservatory/glazed installation market in the UK in the coming years, as more homeowners either replace or upgrade older models.”

The market for conservatories and glazed extensions in the UK is forecast to see relatively buoyant rates of growth in the medium term, and is expected to reach a value of over £760m in 2018 - though this is dependent on continuing recovery in the housing market and consumer confidence remaining buoyant.

The ‘Domestic Conservatory and Glazed Extensions 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.

Friday, February 06, 2015

Floorcoverings market in the UK estimated to be worth £1.8bn

The overall market for floorcoverings is mature, with growth dependent on strong consumer and business confidence, a healthy housing market and buoyant economy. According to AMA Research, the UK floorcoverings market was worth an estimated £1.8bn in 2014, representing value growth of 2% from 2013. A significant decline in 2008-11 has been followed by relatively moderate, but steady, improvement between 2012 and 2014.

This has been the result of an improving economic climate, a recovering housing market and rise in business confidence and levels of investment. The market, which is heavily reliant on replacement and refurbishment, was also buoyed by insurance repairs and replacement of floorcoverings after the floods during 2013-14 in some areas of the UK.

Demand in 2014 has also been driven more strongly by the contract sector, particularly offices, leisure/entertainment applications, where business sentiment remains relatively high. Continuing pressure on margins and average prices has meant that there has been further change to the supply structure in the UK, with further rationalisation of production facilities.

Carpet still dominates the floorcovering product mix, accounting for over 50% in value terms in 2014, a share that has changed only marginally over the last 5 years, but at least indicates the slide in share has stabilised. Wood accounts for around 15% of the market, followed by vinyl, tiles and other floorcoverings.

Demand for laminates has remained relatively flat, although demand is being boosted by a move away from low value entry level products, with greater concentration on mid-upper value sectors – while solid and engineered woods remain popular. Vinyl products have performed relatively well. Luxury vinyl tiles have continued to take share of both the domestic and contract market and ongoing product developments have included higher-specification coatings, improved slip resistance and formats such as loose lay.

A key factor in the market recovery of floorcoverings is the rate of recovery in private sector housebuilding and private sector non-residential construction output into the medium-term. Housebuilding volumes are increasing, while office construction and fit-out are also enjoying strong growth.

Consumer confidence and spending on higher value durables has been hit by the downturn, but both have improved in 2014 and are expected to continue in 2015 – particularly as real incomes are finally starting to rise reflecting the impact of lower fuel prices and inflation and ongoing stabilisation of employment prospects and the underlying economy. Given this background, annual growth for the total floorcoverings market is currently forecast at around 2–3% over the next few years.

“Heavy competition is likely to remain a key characteristic of all flooring sectors into the medium-term, with margins likely to remain under pressure” said Andrew Hartley, Director of AMA Research. “In terms of the supply structure, it is likely that UK manufacturing will be subject to further challenges in terms of production facilities, while in the wider European flooring market there is likely to be further consolidation as the emerging floorcoverings ‘super specialists’ continued to widen their product ranges.”

For more information about this report, visit:

The ‘Floorcoverings 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.

Thursday, February 05, 2015

Trend towards online in industrial consumables distribution market

The UK industrial consumable products market is estimated to be worth £1.8 billion in 2014, according to a new report published by AMA Research. This is a mature and highly fragmented market that, has experienced relatively stable conditions in recent years – after the 2009/10 downturn.

The sector has an extremely fragmented customer base with key end-user sectors including manufacturing, engineering, infrastructure, transport, construction, public authorities and utilities.

Product categories included within the report’s definition of general industrial products are: health & safety; fluid & air control; power tools; engineering & metalworking; hand tools; workshop & maintenance; SSASH (storage, security, access, site equipment & handling); fasteners; janitorial and abrasives. The overall market for consumables is much larger than indicated above, as AMA’s report excludes specialists and focuses on distributors offering a wide range of products.

Key external factors impacting the market include the state of the economy and the relative performance of key customer sectors. Also impacting on the market are general levels of maintenance & repair, legislation, costs of fuel, energy and raw materials, as well as currency fluctuations impacting on product costs.

Distribution of industrial consumables is also fragmented, with some distributors operating in all product sectors defined within this report and others focusing on a more limited number of product sectors. There is a continued trend towards ‘one-stop sourcing’, which is particularly applicable to commodity type products, and many distributors are expanding their product offering to provide an overall package. This trend has undoubtedly been helped by the gradual switch to online sourcing which allows company websites to display more products than shown in catalogues.

Product ranges are generally offered both in catalogues and online, with most leading companies also operating a branch network. Some of the larger distributors are continuing to increase their branch numbers and UK coverage, though the underlying trend is moving towards online. Some distributors have moved their focus to the internet and no longer publish catalogues, while a growing number of companies are offering a digital format catalogue.

The market continues to benefit from an increased focus on health & safety, energy efficiency and environmental issues, which have largely been legislation-driven. Value added services are also important in this market, with demand for systems such as Vendor Managed Inventory (VMI) increasing, which tends to benefit the industrial distributors in particular.

Future market performance is closely linked to the overall state of the economy and general conditions in sectors such as manufacturing, engineering, transportation, utilities, public sector and construction. Overall, future prospects appear more optimistic than in recent years, reflecting growing confidence in the recovery of the UK economy and that it will be sustained in the medium term, though growth rates are expected to vary, reflecting the performance of key end-use sectors. Forecasts are for further steady growth to 2018 leading to an estimated market size of around £2 billion.

“The future performance of individual distributors will primarily depend on their product and customer profile, together with regional strengths, pricing and stockholding strategy” said Andrew Hartley, Director of AMA Research. “Also, value added services provide opportunities for the distributors and those offering services such as VMI are likely to benefit from customers requiring added-value support.”

The ‘General Industrial Products Distribution 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.