Lack of housing will drive DIY recovery

Published:  01 March, 2010

UK: The preference for smaller scale, lower cost home improvement projects such as decorating; upgrading home furnishings and garden projects are expected to remain popular throughout 2010, according to the latest report published by AMA Research.

In the short-term, consumers are likely to undertake DIY tasks themselves rather than get someone in. This trend will continue to benefit the DIY companies and particularly those with a greater emphasis on the consumer, rather than the trade.

The UK DIY multiples market was worth just over £7bn in 2009, a rise of under 1% since 2008, and 3% less than it was back in 2003.

Factors such as falling house prices, low consumer confidence and a low level of house moves have particularly affected 'big ticket' items such as kitchen and bathroom installations.

Consumer spending has fallen with many focusing on saving or repaying debts and mortgages while interest rates have been at historically low levels.

The market for DIY and home improvement products has become increasingly competitive, with greater competition from rival retailers such as grocery multiples.

In terms of their retail operations, it is likely that the DIY multiples will attempt to reduce operating costs and take measures aimed at reducing debt.

This will probably include a reduction in capital expenditure and greater efficiency in terms of store layout, store running costs and distribution networks.

The range of products available online is likely to increase as a means of broadening the customer base and expanding a more cost efficient sales channel. In terms of products, the focus on promotions and value for money products is likely to continue throughout 2010.

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