Small growth for merchants in Q1
Total builders’ merchant value sales to builders and contractors were up 0.4% in Q1 compared with Q1 2017, with one less trading day this year, with average sales a day up 2.0%. Growth would have been stronger had it not been for the “Beast from the East” hammering the external product categories and Good Friday falling into March, removing a trading day.
March was down -8.6% compared with March last year, as a result of two fewer trading days, but January and February’s sales compensated, at +8.4% and +4.0% respectively delivering growth for the quarter.
Quarterly growth was driven by Timber, up +2.3%, alongside multiple internal product categories, notably Plumbing and Heating (+8.0%), Kitchens and Bathrooms (+3.6%), Ironmongery (+2.1%), and Decorating (+1.2%) – all suggesting that work stayed inside due to the poor weather.
External categories fared less well with Landscaping – where garden walling and paving were particularly badly affected – down -4.9%, and the major category of Heavy Building down 0.8% with Cement and Blocks feeling the freeze.
Paul Roughan, Trade Merchants Sales Director Dulux Trade and BMBI’s Expert for Paint said: “Performance in the first quarter of 2018 for decorative paint was certainly dominated by the ‘Beast from the East’! The weather had a serious impact with some merchants reporting at least four days of lost sales which are likely not to be recovered.
“The general retail landscape continues to be under significant pressure. It is impacted by the growth of online shopping, soaring labour costs, business rates and a drop in consumer spending amid economic uncertainty.
“The trade market has fared a little better than retail in Q1 but paint volumes still declined by 1.5%. Value increased in that period by 2.1%, but this increase has predominantly been driven by manufacturer cost price increases. The exterior paint category was also severely impacted by the weather conditions in Q1 with volumes significantly down. We have fingers crossed that the recent good weather continues.
“One of the key growth sectors has been new build private housing. This sector grew last year by around 5% in the paint category. We are expecting it to suffer this year due to declining house prices across London and parts of the South East. This house price reduction is likely to spread to other parts of the country and as we know, housebuilders are less likely to build when prices are falling.”
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