UK market for Catering Equipment increased by 4% in 2014

In 2014, the non-domestic catering equipment market was estimated to be worth over £750m, representing a growth of around 4% on 2013. The market is considered to be mature across all sectors. As a result, there is limited potential for growth through increased penetration, making the market subject to performance of the overall economy and food industry.

UK household expenditure on catering services, including drink, in 2013 was nearly £84bn, which indicates the potential scale of demand for catering equipment. The catering market struggled during the early part of the recession, but has experienced a rising trend in expenditure since 2010 and has proved to be a successful sector, outperforming most other areas of consumer spending over the last 5 years.

The main factor supporting growth of the catering equipment market since 2010 has been the overall improvement in the economy and the strong resilience of the restaurant sector. Innovative concepts and new restaurant brands, along with an improvement in household spending on eating out, has helped grow the catering sector - and therefore demand for catering equipment.

Other factors supporting market growth include product development creating added value features; higher hygiene standards; the requirement for smaller and more environmentally friendly, sustainable products in response to tightening legislation; and the development of restaurant and hotel chains.

Whilst the government remains committed to public sector cutbacks affecting some demand, the budgets for the NHS remain secure along with educational catering, which has been singled out and budgeted for future growth in catering needs including the extension of free school meals.

Cooking equipment is the largest sector and accounts for over 50% of market value. Refrigeration accounts for around a quarter, with steel fabrication, warewashing and other products making up the remaining market value. The leading end user is the hospitality sector, with restaurants, cafes and bars accounting for around 54% of the market. The remainder is accounted for by health and education, with a reasonable share, hotels, and other sectors such as offices, leisure and retail.

Products are largely distributed through specialist distributors and designers and installers, although there is some direct delivery, particularly as the internet becomes more widely used. Direct delivery is more prevalent in the steel fabrication side, where bespoke solutions dominate.

The outlook for the catering equipment market is good, providing the UK economy continues to strengthen and the hospitality industry continues to grow, with the restaurant sector a key factor influencing growth in catering equipment demand.

“The government has committed to reducing the level of public sector debt, resulting in reduced levels of expenditure across many government departments, and this will continue to depress demand for catering equipment within government departments” said Andrew Hartley, Director of AMA Research. “But other sectors continue to show ongoing sustained budgets, for example in healthcare with education receiving an extra boost of over £1 billion in funding in 2014-15 for the free school meals programme.”

More information can be found on: www.amaresearch.co.uk/catering_equipment_15.html

The ‘Non-Domestic Catering Equipment 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 www.amaresearch.co.uk or by calling 01242 235724.

Recovery at last for the UK Shopfitting market in 2014

The UK shopfitting market was worth an estimated £3bn at manufacturers prices in 2014, an increase of 6% from the previous year, according to a new report by AMA Research.

Demand for shopfitting work had declined in recent years as the financial crisis impacted on retail sales and consumer spending. However, both retail sales and the demand for shopfitting services increased in 2013 and 2014, reflecting the beginning of a recovery in consumer confidence. Some retailers have tried to respond to this recovery in consumer spending by rolling out wider refurbishment programmes and upgrading existing sites to promote their brands and increase footfall.

During the downturn, the nature of shopfitting work changed, with low value, short-term contracts becoming more of a feature of the sector. With retailers cautious about capital expenditure, project values declined and contracts were let predominantly on a competitive basis, rather than on longer-term frameworks as was the case before the downturn. In addition, there has been greater emphasis by retailers on redecorating and giving stores a ‘refresh’, by changing interior fixtures such as lights, carpets and furniture, and by putting in new displays.

The UK shopfitting market is complex and highly fragmented, with a large number of suppliers undertaking a wide range of activities. The sector has seen a relatively high level of consolidation in recent years, which has led to the number of contractors focused on shopfitting declining substantially, though in some areas this has also led to a shortage of specialists to carry out the available work.

The industry also continues to face a number of challenges as retail and leisure trends evolve at a rapid pace and retail companies constantly re-brand and innovate to maintain their competitiveness and respond to changing consumer behaviour. The pace of convenience/ discount store format roll-out programmes, changing consumer habits, shifts in fashion, shrinking retailer budgets and the challenge of shopper expectations on store design and space requirements, are all impacting on the sector and providing opportunities for shopfitters. In addition, the shopfitting market is affected by growth in online retail sales, with physical store outlets contributing less to overall retail sales.

Growth in the shopfitting market is largely reliant on performance of its two main end use sectors, retail and entertainment, which have experienced varying fortunes over the last 5-6 years. With the shopfitting market dependent on the economic climate and the rate at which the UK recovers from the downturn, demand is expected to be unevenly split across retail sectors, with the London retail fit-out market driving demand. The short-medium term opportunities for shopfitting contractors are likely to come from the value and discount retailers and the grocery convenience sector.

“Key drivers of growth in the shopfitting market at present include a focus on smaller convenience food stores in smaller urban locations, significant programmes in the budget hotel, budget gym and cinema sectors, and a strong airport retail sector” said Andrew Hartley, Director of AMA Research. “Technology in store is also becoming an established part of the design process, driven by increasing digitalisation of store interiors and the introduction of a self-service element within shops, restaurants and leisure facilities.”

Going forward, between 2015 and 2019, the UK market for shopfitting is forecast to maintain steady growth, with typical underlying annual levels of growth of around 4-5%, reflecting the projected increase in refit programmes compared with new build schemes. More information can be found at the following link: www.amaresearch.co.uk/Shopfitting_15.html

The ‘Shopfitting 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 www.amaresearch.co.uk or by calling 01242 235724.

Good growth forecast for plumbing contractors market in 2015

The plumbing contractors market was estimated to be valued at around £14.7bn in 2014, having seen good levels of growth over the last two years.

The plumbing contracting sector weathered the economic downturn fairly well compared with other construction sectors, due to the fact that a large share of work is made up of repair and maintenance, which is generally more resilient than work within the newbuild sector. In addition, plumbing installations cover a number of non-domestic sectors, in addition to housing, and some of these, in particular the public sectors, continued to perform relatively well into the recession due to continued government investment to support the construction industry.

The market experienced a slight improvement in 2010 and again in 2011, however, value was inflated by widespread material cost increases within some plumbing product sectors, particularly those related to copper. In addition, spending cuts within the public sector had started to come into effect and the value growth could not be sustained, leading to a decline in the plumbing contracting market during 2012. The situation was more positive in 2013 and while the economic situation remained relatively fragile, there were positive signs during 2014 - business confidence improved and construction activity increased sharply, particularly in the housing sector.

The key occupational roles across the plumbing contracting sector include general plumbing and bathroom installations (mostly domestic), gas installation and maintenance, refrigeration and air conditioning, and heating and ventilation. Employment in the plumbing and heating sector is expected to increase across England, Scotland and Wales. There are currently skills shortages for fully qualified plumbers, which should increase labour costs and support value growth across the contracting sector in the short to medium term.

Future prospects for the plumbing contracting market are relatively bright, providing the construction market in general continues to improve. Indications for 2015 are positive and it is hoped the market will achieve value growth of around 6% during the year. While the pace of growth is likely to have slowed by 2016/2017, it is expected that the plumbing contracting market will be worth £17.1bn by the end of the forecast period.

“Opportunities for growth are likely to be found in the new housing sector, which is currently being driven by rising prices, increased mortgage lending, as well as a growing uptake of the government’s ‘Help to Buy’ programme” said Keith Taylor, Director of AMA Research. “In the existing housing sector, the changes to the stamp duty levels along with growing consumer confidence and spending, should support increased RMI expenditure.”

It is likely that as the economy improves and consumer confidence grows, an increasing number of consumers will begin to focus on higher value, big ticket projects such as kitchens and bathrooms. This is perhaps already the case in London and the south east and other areas which have experienced high property value growth. Other potential areas of growth include the installation of additional bathrooms, e.g. en-suite and cloakrooms into properties, along with kitchen extensions and utility rooms.

The ‘Plumbing Contractors 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 www.amaresearch.co.uk or by calling 01242 235724.

Freelance Researchers required

AMA Research are the leading publisher of in-depth market research reports covering building/construction, industrial and home improvement products, materials, supply chains and contractor sectors.

We are looking to expand our research team with freelance staff on a flexible basis.

Candidates should have some marketing/market research experience, key attributes also required include strong analytical and information gathering skills, a good knowledge of marketing issues and the ability to research, analyse and prepare a professional, detailed report under our guidance.

Freelance researchers will be happy to mostly work from home under their own initiative, undertaking desk and telephone research, as well as collating and analysing findings and preparing outputs.

To apply for this role, or to obtain further details, please send an e-mail including your C.V. to sales@amaresearch.co.uk.