AM45134

AMA RESEARCH Market Report : UK Conservatory Market, Domestic : October 2004

CLICK TO BUY

Introduction and Overview

AMA Research have published the Eighth Edition of the ‘Domestic Conservatory Market – UK 2004’- incorporating original input and primary research, it represents an up-to-date and comprehensive review of the Conservatory market.

The report reviews the Conservatory market in domestic applications which, despite difficult market conditions in 2004, is now worth over £1.3 billion at retail prices, with annual volumes continuing to rise reflecting its widespread appeal. However, the market value increases up towards £2 billion when installation costs, furniture, lighting, flooring, window coverings and other accessories are included.

Key issues reviewed:-

MARKET SIZE - Volumes, Values, Trends, Forecasts.

PRODUCT MIX - Styles/Designs

FRAME MATERIALS - Share by PVCu, Aluminium, Timber - Trends, Forecasts.

SUPPLY & DISTRIBUTION - Key Suppliers, Shares, Channel Shares.

Compiled by marketing professionals with experience of the Conservatory market, our report answers the need for both a comprehensive review of market developments and a detailed analysis of influencing factors and possible future trends.

Key Areas Of Interest:-

Review of market performance – difficult year in 2004

Material usage by sector – recent trends and future changes.

Market prospects - future growth, saturation levels - how far can it grow?

Estimated £2 billion market when blinds, tiles, furniture, lighting etc. all included

Key areas of coverage in the report include:-

MARKET

Market size by VALUE - market developments from 1985-2003, analysis and forecast of market trends up to 2007.

Conservatory market by VOLUME - rapid growth in mid-late 1990s, market conditions from 1999-2003, difficult 2004 & future prospects to 2007 etc. - factors influencing future developments.

Market sizes by product and material usage - changing mix between PVCu, Timber & Aluminum, strengths and weaknesses of different product/market sectors.

Future prospects for material usage up to 2007.

Market penetration levels - current household ownership levels and future developments - saturation levels and limiting factors on long term growth.

Analysis of overall market developments - growth rates, changing market conditions in 2004, materials, component supplies (roof systems etc.) design changes - changes in recent years/future trends.

Analysis of conservatory accessories including flooring, window coverings, underfloor heating etc. – overall market size and trends.

DISTRIBUTION AND SUPPLY

Channels of Distribution - Sales of products by channels of distribution (DIY Outlets, Garden Centres, Direct Sell Companies, Specialists, Builders etc. - Areas of specialisation, major changes in recent years.  Comparison of 1990/1997/1999/2003.

Growth of new build as a market sector - recent trends, changing housing market,  longer term potential.

Mix of material usage by distribution channels - analysis of major changes.

Distribution structure for PVCu, Aluminum & Timber Conservatories - major differences between material.

Distribution Channel Share - by Volume and value.

Future prospects for major channels - including analysis of radical changes in market structure in recent years - growth of Direct Sell etc.

Major suppliers - market shares, product positioning, specialisation, shares within market sectors, areas of growth/decline - strengths and weaknesses.

Analysis of price levels - recent and future trends.

GENERAL & FUTURE PROSPECTS

Comparison of market size, growth rates and household penetration levels (1990-2001) of Conservatories, Replacement Windows, Fitted Kitchens, Showers and Central Heating - comparisons between new and mature markets.

Review of socio-economic factors influencing the market - growth in disposable income, age distribution of population, housing trends, prospects over 2004-07 period etc.

Executive Summary

Sales of conservatories have increased substantially over the last decade and represent the best performing sector of any major consumer durable. Consumer awareness and interest in the product is still very high, with most householder surveys indicating conservatories high up on the list of preferred home improvements.

Since the early-1990s, market volumes have continued to grow, as illustrated in the chart below, to an estimated level of 237,000 units in 2003 and forecast to show further growth to 278,000 units by 2007, though annual rates of growth are slowing down rapidly.

Prospects for the conservatory market in 2004 remain relatively optimistic, although there are already signs of a slow down. Consumer confidence remained high throughout 2002/03 and early 2004 as a result of continuing low interest rates, rapidly increasing house prices and low unemployment coupled with rising incomes, resulting in high consumer borrowing and equity withdrawal levels which are helping to underpin market growth.

However, interest rates have been increasing steadily in 2004 in an effort to cool the economy and reduce consumer spending, with early indications in late-Summer that the increases are beginning to take effect on housing and consumer spending. In the short-medium term, therefore, volume growth is predicted to slow as the market matures and consumer spending slows down, and the level of potential conservatory applications decline.

New housing continues to represent a small sector of demand for conservatories, but volumes are unlikely to grow markedly due to ongoing increases in building land prices.  This results in rapidly rising average prices for new homes, in addition to smaller plots limiting the opportunities for new build conservatories, despite the cost benefits of including a conservatory within the original specification. In addition, a major long-term restriction is the increasing proportion of 1-2 person households, which is likely to result in further demand for smaller homes, such as flats, maisonettes etc. At present, single person households account for around a third of the population. However, the high divorce rate and the proportion of couples delaying starting a family is expected to rise, fuelling the demand for smaller dwellings – 2003/04 has seen a rapid growth in the proportion of apartments/flats in new dwellings figures .

PVCu remains the dominant frame material for conservatories with an estimated current share of 81%. Timber’s share of the market has declined very slowly to around 18% in recent years, with aluminium experiencing a rapid decline in the 1990’s and now only accounts for around 1% of installations.

However, PVCu's share has now levelled out and will have to erode timber sales if further share gains are to be achieved. Timber is still preferred by many homeowners, with DIY Multiples, Garden Centres and Specialists all widely offering the material. However longer term availability of hardwood from sustainable sources may affect the share timber in future.

Replacement window companies are now the major distribution channel for conservatories, accounting for an estimated 66% of sales, though share is very fragmented between a large number of retail operations.

The DIY Multiples account for an estimated volume share of 20%, but virtually all sales are concentrated through Wickes and B&Q, with Homebase only recently entering the market. The high level of price competition in the DIY sector, and the greater focus on higher quality products has resulted in some loss of value share for this sector in recent years.

Garden Centres and Portable Building specialists have continued to see share eroded and now account for around 7% of sales, compared to over 30% in the early-1990s. Conservatory specialists, such as Amdega, and builders account for the remaining 7% of the market, though share by value would be high given their much higher average retail prices.

In overall terms, the supply structure is still very fragmented due to the range of alternative frame materials and distribution channels. While Anglian and Everest are leading brand names in the replacement window market, the sector is dominated by 2000+ companies each typically installing a small volume of conservatories.

BHD are the leading supplier overall due to their strong supply links with Wickes and their Houseproud and Portland Conservatory subsidiaries supplying into other channels. However, BHD went into receivership for a short period recently and has subsequently been acquired by the Laird Group. Amdega and David Salisbury, along with Portland, are leading suppliers in the high value specialist sector of the market, with Amdega a particularly strong conservatory brand.

Overall, the prospects for the conservatory market in the longer term are favourable, providing the economy remains strong and consumer confidence levels can be maintained. The appeal of conservatories remains high as a desirable lifestyle product for many homeowners and given that house prices have doubled in the last five years are seen to be good value as the cost of installation has not changed substantially over the same period.

In the medium term, with potential for growth in household ownership levels, annual volumes and values should remain buoyant, although growth rates are likely to be much smaller than has been experienced in the last 5 years as the market approaches maturity. In addition, there are indications that there is a switch to more budget models, as the market for new conservatories widens to smaller/lower disposable income households.

List of Contents

1	INTRODUCTION
2	SUMMARY
3	ECONOMIC ENVIRONMENT
3.1	GDP
3.2	INFLATION & INTEREST RATES
3.3	UNEMPLOYMENT
3.4	HOUSEHOLD CONSUMPTION
3.5	HOUSING & CONSTRUCTION
3.6	STERLING
3.7	POPULATION PROFILE
3.8	CONCLUSIONS
4	MARKET STRUCTURE
4.1	MARKET DEFINITION
4.2	MARKET SIZE
4.2.1	Background
4.2.2	Current Trends & Future Growth
4.3	MARKET VOLUMES
4.3.1	Background
4.3.2	Current Situation & Future Growth
4.4	HOUSEHOLD OWNERSHIP LEVELS
5	PRODUCTS
5.1	FRAME MATERIALS
5.2	DESIGNS
5.2.1	Customised/Standard Designs
5.2.2	Conservatory Designs
5.2.3	Single/Double Glazed Models
5.2.4	Roof Systems
5.3	OTHER RELATED PRODUCTS
5.3.1	Floorcoverings
5.3.2	Heating Systems
5.3.3	Window Coverings
6	SUPPLIERS
7	CHANNELS OF DISTRIBUTION
8	FUTURE PROSPECTS

Tables and Charts

Text © 2004 AMA Research

Can't find what you need? Try our "Research on Request" market report service and define your own report research! Fixed prices - £150, £450 and £1,250 - and fixed delivery of 4, 5 and 14 days

Click here for full details

---

Ariadne - working together with our customers to enhance productivity and increase knowledge
© 2004 www.the-list.co.uk Ariadne
Last updated by Amanda Porteous 2004