| KN93005 |
| KEY NOTE Market Report : Dry Cleaning and Laundry Services : April 2005 |
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| Executive Summary |
| 1. Market Definition |
| Report Coverage |
| MARKET SECTORS |
| Market TRends |
| Home Laundry Market |
| Table 1: Ownership of Washing Machines and Tumble Driers (% households), 1991-2003 |
| UK Client Sector Performance |
| Table 2: Turnover in Hotels, Restaurants, and Hospitals and Related Activities (index 2000=100), 2000-2004 |
| Environmental Legislation |
| Cost Issues |
| Launderettes Move Upmarket |
| ECONOMIC TRENDS |
| Gross Domestic Product |
| Table 3: UK Gross Domestic Product at Current and Annual Prices (£m), 1999-2003 |
| Household Disposable Income |
| Table 4: Household Disposable Income per Capita (£), 1999-2003 |
| Unemployment |
| Table 5: Actual Number of Unemployed Persons (million), 1999-2003 |
| MARKET POSITION |
| The UK |
| Table 6: Total UK Consumer Expenditure and Consumer Expenditure on Cleaning, Repair and Hire of Clothing (index 2000=100), 2000-2004 |
| 2. Market Size |
| THE TOTAL MARKET |
| Table 7: The UK Dry Cleaning and Laundry Services Market by Sector by Value at Current Prices (£m), 2000-2004 |
| By Market Sector |
| Corporate Sales |
| Table 8: The UK Corporate Dry Cleaning and Laundry Services Sector by Value at Current Prices (£m and %), 2000-2004 |
| Retail Sales |
| Table 9: The UK Retail Dry Cleaning and Laundry Services Sector by Value at Current Prices (£m), 2000-2004 |
| Dry Cleaning |
| Table 10: The UK Retail Dry Cleaning Sector by Value at Current Prices (£m and %), 2000-2004 |
| Laundry Services |
| Table 11: The UK Retail Laundry Services Sales by Value at Current Prices (£m), 2000-2004 |
| 3. Industry Background |
| RECENT HISTORY |
| Number of Companies |
| Table 12: Number of VAT-Based Enterprises Engaged in the Washing and Dry Cleaning of Textile and Fur Products (number and index 2000=100), 1994, 1998 and 2000-2004 |
| Table 13: Number of VAT-Based Enterprises Engaged in the Washing and Dry Cleaning of Textile and Fur Products by Turnover Sizeband (number and %), 2004 |
| Employment |
| Table 14: Employment in the `Other Services' Sector (000), September 2000-2004 |
| Regional Variations in the Marketplace |
| HOW ROBUST IS THE MARKET? |
| LEGISLATION |
| KEY TRADE ASSOCIATIONS |
| European Textile Services Association |
| National Association of the Launderette Industry |
| Textile Services Association |
| 4. Competitor Analysis |
| THE MARKETPLACE |
| MARKET LEADERS |
| The Davis Service Group PLC |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| Johnson Service Group PLC |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| OCS Smarts Ltd |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| PHS Group PLC |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| Rentokil Initial PLC |
| Company Structure |
| Current and Future Developments |
| Financial Results |
| OTHER COMPANIES |
| Bowie-Castlebank |
| Brooks Service Group PLC |
| White Knight Laundry Services |
| Smaller Groups |
| ALS |
| Launderette Operators |
| Outside Suppliers |
| MARKETING ACTIVITY |
| Table 15: Main Media Advertising Expenditure by Dry Cleaners and Launderers (£000), Years Ending December 2003 and 2004 |
| Exhibitions |
| 5. Strengths, Weaknesses, Opportunities and Threats |
| STRENGTHS |
| WEAKNESSES |
| OPPORTUNITIES |
| THREATS |
| 6. Buying Behaviour |
| THE CORPORATE Market |
| The CONSUMER MARKET |
| Consumption by Age |
| Table 16: Average Weekly UK Household Expenditure on Dry Cleaners, Laundry and Dyeing by Age of Head of Household (pence per week), 2002/2003 |
| Consumption by Income |
| Table 17: Average Weekly UK Household Expenditure on Dry Cleaners, Laundry and Dyeing by Gross Income Decile (pence per week), 2002/2003 |
| 7. Current Issues |
| PERC ALTERNATIVES |
| GreenEarth |
| CO2 |
| Polar Dehydration |
| 8. Forecasts |
| INTRODUCTION |
| Gross Domestic Product |
| Table 18: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2004-2008 |
| Inflation |
| Table 19: Forecast UK Rate of Inflation (%), 2004-2008 |
| Unemployment |
| Table 20: Forecast Actual Number of Unemployed Persons (million), 2004-2008 |
| Forecasts 2005 to 2009 |
| Table 21: The Forecast UK Dry Cleaning and Laundry Services Market by Sector by Value at Current Prices (£m), 2005-2009 |
| FUTURE TRENDS |
| Demographics |
| Table 22: Forecast UK Population by Age (000), 2002, 2005 and 2008 |
| Market Segmentation |
| Competitor Forecasts |
| 9. Company Profiles |
| The Davis Service Group PLC |
| Johnson Service Group PLC |
| Ocs Smarts Ltd |
| Phs Group PLC |
| Rentokil Initial PLC |
| Further Sources |
| Associations |
| Publications |
| General Sources |
| Government Publications |
| Other Sources |
| Bonnier Information Sources |
| The UK dry cleaning and laundry services industry grew by 6.7% between 2000 and 2004 to generate sales of £1.37bn. The main services offered are textile rental, dry cleaning and laundry services to the corporate and consumer markets. |
| Sales to corporate clients continue to take the largest share of the market, accounting for 62.8% of revenues in 2004. Outsourcing is the established practice for many companies that require textile services, and rent linen and work wear from third parties, which then service and maintain it for the client group. Other products include industrial wipers and dust mats for a range of purposes. The shift in the UK economy from a manufacturing to a service base has been beneficial for this sector, as presentational aspects, such as corporate wear, have gained importance and priority within client companies. Health and safety legislation and requirements have also boosted demand from the manufacturing and process sectors. |
| The retail market has seen little growth since the start of the new millennium. Falling prices in the clothing market have encouraged consumers to replace rather than maintain, make or mend. Changes in fabric technology have also meant a growing range of machine-washable formal wear, which would previously have been reliant on dry cleaning. However, many consumers still prefer to opt for a professional service. The cliché of the cash rich, time poor society has also led to growing demand for home laundering services and door-to-door operations, which has been one developing area of the market. |
| The dry cleaning, laundry and textile services market remains very fragmented in terms of supply, with a large number of smaller operators being characteristic. The majority of businesses offer services to a relatively small geographical area, particularly in the retail segment. Those dealing with corporate groups require additional investment in equipment and facilities, therefore cast their nets wider. Nonetheless, in 2004, only a handful of companies generated sales of more than £5m per annum. Consolidation is an ongoing process in the sector. Johnsons Group PLC has made considerable progress in developing its position with the acquisition of a number of operations, including the former Sketchley chain in 2004. |
| Service groups are very exposed to the performance of client markets. Positive trends, such as the upturn in the hotel sector, have led to growing sales and the core market is well established. Outsourcing of these types of services is long established and unlikely to be reversed. The consumer market will be affected by changing textile technology that simplifies home care of clothing. However, other services, such as ironing and laundry services for domestic clients, may provide more positive sales trends. |
| Key Note anticipates that the market will show positive growth over the short to medium term as client sectors continue to perform well. |
Text © 2005Key Note
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Last updated by Amanda Porteous 2005
