Key Note estimates that retail sales of china and earthenware tableware, kitchenware and ornamental ware were worth £1.28bn in 2001. This is a highly-competitive market, particularly the tableware sector, although it is dominated by Wedgwood and Royal Doulton. However, the contribution that countless small operations and individual craftspeople make to the design-led industry, which thrives on innovation and creativity, should not be underestimated.

Consumer spending in the UK was particularly buoyant in the run up to Christmas 2001 and into the New Year of 2002, with sales of household goods seeing 10 percent growth in November 2001 — the largest monthly increase since January 2000. However, the International Monetary Fund (IMF) has warned that 2001 saw the weakest global growth since 1993, with the economies of the US, Japan and continental Europe simultaneously in recession. These are crucial markets for the UK's exports of china and earthenware. Traditionally, the UK has had a favourable trade balance in ceramics, but this is fading fast as the growth in the value of exports fails to keep up with that of imports.

The most noticeable trend of recent years has been the move away from formal to casual dining, and consumers are abandoning the matching china sets, which used to sustain the likes of Wedgwood and Royal Doulton, in favour of fashion-led individual pieces. The bridal market — of importance to the premium end of the china market — is also diminishing, and it has been suggested that the industry should concentrate more on encouraging frequent changes in tableware, particularly in older households, to reflect changing tastes. The increase in the number of households also offers the potential to grow market volume.

The china and earthenware industry misses no opportunity to issue commemorative items for both the mass market and as limited editions for collectors. 2002 will mark the Golden Jubilee of the accession of the Queen, and there are already numerous commemorative products available through mail order, retail outlets and online. Even the return of Concorde to commercial flights has been commemorated by a selection of limited editions.

In a further positive development, the Ceramic Industry Forum, which was launched in August 2000, is to receive further funding, of £1.8m, to be devoted to a 5-year design and marketing programme called 'Leading by Design.' It is hoped that the Forum will succeed in its efforts to shape the long-term future of an industry that, despite its current difficulties, remains a significant contributor to the UK economy.

Key Note forecasts that the market will only achieve modest growth between 2002 and 2006, reflecting the trend seen in the late 1990s and early 2000s.