UK Retail Futures 2012: Electricals
Introduction
Verdict Research: Rapid growth between 2002 and 2008 leave the electricals sector with tough comparatives over the next five years. In particular maturing specialists will struggle to gain share as non-specialists build their credentials in the sector, targetting the faster growing segments of the market.
Scope
Value data, growth rates and forecasts broken down by sub sectorCoverage of key market issues and growth driversElectricals market expenditure, inflation and volume growth (1997-2007), plus full five-year forecasts for each of the key sub sectors categoriesHighlights
The electricals market will see a significant slowdown in growth over the next five years with electricals specialists in particular set to struggleA whole raft of competitors will put further pressure on specialists. These non-specialists will target the fastest growing electricals sub sectorsDesite a slowdown, there is still much to be positive about with many product trends pointing towards robust performancesReasons to Purchase
Plan confidently for the future with reliable independent forecasts for market growth and action points to guide strategiesOptimise buying, identify emerging trends and allocate resources so that you can capitalise on themIncentivise managers to outperform by setting your growth forecasts against an independent source
CHAPTER 1 EXECUTIVE SUMMARY 6
Key Findings 6
Main Conclusions 7
CHAPTER 2 FORECAST SUMMARY 10
Expenditure Summary 10
Specialists Summary 11
CHAPTER 3 KEY MARKET ISSUES 13
Overview 13
Games Consoles & Software / Audio-visual to Drive Growth 14
Blu-ray - HD-DVD Format War Resolves 15
Digital Switchover 17
Specialists Continue to Underperform 18
Price Deflation Holds Back Market Severely 20
Other Sector Trends 21
Photographic & Optical Equipment 21
Digital Convergence 22
Satellite Navigation 22
Laptops 22
CHAPTER 4 ELECTRICALS SPECIALISTS OUTLOOK 23
Retail Sales 23
Sources of Sales Growth 25
Share of Total Sales 27
Store Numbers 28
Space Growth 29
Sales Densities 30
CHAPTER 5 CHANNELS OF DISTRIBUTION 32
Sales & Spending 32
Forecast Changes for Major Sectors 34
Electricals Market Shares 36
CHAPTER 6 CATEGORY FORECASTS 38
Expenditure Summary 38
Expenditure Analysis 39
Expenditure Growth 42
Brown Goods 44
Audio-visual Equipment 46
Games Consoles and Software 48
Photographic & Optical Equipment 50
White Goods 52
Major Household Appliances 54
Minor Household Appliances 56
Grey Goods 58
Information Processing Equipment 60
Telephones & Fax Equipment 62
CHAPTER 7 UK ECONOMIC FORECASTS 64
Key Messages 64
Gross Domestic Product - GDP 69
How does it affect retail? 69
What's happened? 70
What will happen? 70
Earnings Growth 71
How does it affect retail? 72
What's happened? 72
What will happen? 73
Real Household Disposable Income 74
How does it affect retail? 74
What's happened? 75
What will happen? 75
Employment 76
How does it affect retail? 77
What's happened? 77
What will happen? 78
Inflation 79
How does it affect retail? 80
What's happened? 80
What will happen? 81
Exchange Rates 82
How do they affect retail? 82
What's happened? 82
What will happen? 83
Interest Rates 84
How do they affect retail? 84
What's happened? 85
What will happen? 86
Savings Ratio 87
How does it affect retail? 87
What's happened? 87
What will happen? 88
Consumer Debt 89
How does it affect retail? 89
What's happened? 90
What will happen? 90
Equities 91
How does it affect retail? 91
What's happened? 92
What will happen? 92
House Price Inflation 93
How does it affect retail? 93
What's happened? 94
What will happen? 94
Housing Equity Withdrawal 95
How does it affect retail? 95
What's happened? 96
What will happen? 97
Housing Transactions 97
How does it affect retail? 97
What's happened? 98
What will happen? 99
CHAPTER 8 UK RETAILING FORECASTS 100
Key Indicators 100
Retail Expenditure 1997-2012 102
Sales by Location 2007-2012 108
Sources of Growth 1997-2012 112
Store Numbers by Location 1997-2012 114
Space by Location 1997-2012 116
Sales Density by Location 1997-2012 119
Average Store Size 1997-2012 121
Average Store Sales 1997-2012 123
Online Retail Spending 124
CHAPTER 9 GLOSSARY 126
Terminology 126
Market Definition 127
Location Definitions 128
Town Centre 128
Out-of-town 128
Neighbourhood 128
Non-store retail 129
Forecasting Methodology 129
Abbreviations 131
List of Tables
Table 1: Electricals expenditure summary 2002, 2007 & 2012 10
Table 2: Electricals specialists summary 2002, 2007 and 2012 11
Table 3: UK electricals growth by sub sector 2002-07 and 2007-12 14
Table 4: Timing of the digital switchover 2008-2012 17
Table 5: Electricals specialists sales 1997-2012 23
Table 6: Sources of growth for UK electricals specialists 1997-2012 25
Table 7: Total selling space for electricals specialists 1997-2012 29
Table 8: Electricals channels of distribution by retailer type 2006, 2007 and 2012 34
Table 9: Electricals retailers market shares 2003-2008e 36
Table 10: Electricals expenditure summary 1997, 2002, 2007 & 2012 38
Table 11: Brown goods expenditure analysis 2007-2012 39
Table 12: White goods expenditure analysis 2007-2012 40
Table 13: Grey goods expenditure analysis 2007-2012 41
Table 14: Total electricals expenditure 1997-2012 42
Table 15: Brown goods expenditure 1997-2012 44
Table 16: Audio-visual equipment expenditure 1997-2012 46
Table 17: Games consoles and software expenditure 1997-2012 48
Table 18: Photographic & optical equipment expenditure 1997-2012 50
Table 19: White goods expenditure 1997-2012 52
Table 20: Major household appliances expenditure 1997-2012 54
Table 21: Minor household appliances expenditure 1997-2012 56
Table 22: Grey goods expenditure 1997-2012 58
Table 23: Information processing equipment expenditure 1997-2012 60
Table 24: Telephone & fax equipment expenditure 1997-2012 62
Table 25: Economic drivers for retail 2008 64
Table 26: Measures of inflation 2008 79
Table 27: UK retailing forecasts summary 2007-2012 100
Table 28: Forecast chronology 2008-2012 101
Table 29: Total consumer retail expenditure 1997-2012 102
Table 30: Sales by location 1997-2012 109
Table 31: Total UK physical store sales & selling space 1997-2012 112
Table 32: Sources of sales growth for physical stores 1997-2012 113
Table 33: Store numbers 1997-2012 114
Table 34: Space by location 1997-2012 116
Table 35: Sales densities by location at current prices 1997-2012 119
Table 36: Average store size by location 1997-2012 121
Table 37: Average sales per store by location at current prices 1997-2012 123
Table 38: Electricals market definition 2008 127
List of Figures
Figure 1: Electricals specialists sources of growth 1997-2007 and forecast to 2012 12
Figure 2: Electricals market key issues 2007-2012 13
Figure 3: Drivers and brakes on HD player growth 2007-2012 16
Figure 4: Specialists vs non-specialists performance 2007-2012 18
Figure 5: Forecast annual average inflation/deflation by electricals sub sector 2007-2012 20
Figure 6: Electricals specialists sales as a % of total UK retail consumer spending 1997-2012 27
Figure 7: Total electricals specialists store numbers (000) 1997-2012 28
Figure 8: Space growth for electricals specialists 1997-2012 29
Figure 9: Electricals specialists sales densities at current prices 1997-2012 30
Figure 10: Electricals specialists sales densities at constant (2003) prices 1997-2012 31
Figure 11: Electricals channels of distribution 2006, 2007 & 2012 33
Figure 12: Forecast changes in shares of major channels in the electricals market 2012 on 2007 35
Figure 13: Key electricals retailers change in market share 2003-2008e 37
Figure 14: Electricals expenditure as a % of total spending 1997-2012 43
Figure 15: Electricals growth at constant (2003) prices 1997-2012 43
Figure 16: Brown goods expenditure as a % of electricals spending 1997-2012 45
Figure 17: Brown goods expenditure growth at constant (2003) prices 1997-2012 45
Figure 18: Audio-visual equipment expenditure as a % of electricals spending 1997-2012 47
Figure 19: Audio-visual equipment expenditure growth at constant (2003) prices 1997-2012 47
Figure 20: Games consoles and software expenditure as a % of electricals spending 1997-2012 49
Figure 21: Games consoles and software expenditure growth at constant (2003) prices 1997-2012 49
Figure 22: Photographic & optical equipment expenditure as a % of electricals spending 1997-2012 51
Figure 23: Photographic & optical equipment expenditure growth at constant (2003) prices 1997-2012 51
Figure 24: White goods expenditure as a % of electricals spending 1997-2012 53
Figure 25: White goods expenditure growth at constant (2003) prices 1997-2012 53
Figure 26: Major household appliances expenditure as a % of electricals spending 1997-2012 55
Figure 27: Major household appliances expenditure growth at constant (2003) prices 1997-2012 55
Figure 28: Minor appliances expenditure as a % of electricals 1997-2012 57
Figure 29: Minor household appliances expenditure growth at constant (2003) prices 1997-2012 57
Figure 30: Grey goods expenditure as a % of electricals 1997-2012 59
Figure 31: Grey goods expenditure growth at constant (2003) prices 1997-2012 59
Figure 32: Information processing equipment expenditure as a % of electricals spending 1997-2012 61
Figure 33: Information processing equipment expenditure growth at constant (2003) prices 1997-2012 61
Figure 34: Telephone & fax equipment expenditure as a % of electricals spending 1997-2012 63
Figure 35: Telephone & fax equipment expenditure growth at constant (2003) prices 1997-2012 63
Figure 36: Real gross domestic product (GDP) at constant (2003) prices 1997-2007 and forecast to 2012 69
Figure 37: Inflation vs average earnings growth 1997-2007 and forecast to 2012 71
Figure 38: Tax & Prices vs Average Earnings 1997-2007 and forecast to 2012 71
Figure 39: Real household disposable income at constant (2003) prices 1997-2007 and forecast to 2012 74
Figure 40: UK employment 1997-2007 and forecast to 2012 76
Figure 41: UK employment 1997-2007 and forecast to 2012 76
Figure 42: Inflation rates Y-o-Y 1997-2007 and forecast to 2012 79
Figure 43: Sterling, dollar and euro exchange rates 1997-2007 and forecast to 2012 82
Figure 44: UK average base rates 1997-2007 and forecast by quarter for 2008 84
Figure 45: UK average base rates 1997-2007 and forecast to 2012 85
Figure 46: Savings ratio 1997-2007 and forecast to 2012 87
Figure 47: Growth in consumer debt 1997-2007 and forecast to 2012 89
Figure 48: FTSE 100 Index 1997-2007 and forecast to 2012 92
Figure 49: UK house price inflation 1997-2007 and forecast to 2012 93
Figure 50: Housing Equity Withdrawal (England & Wales) 1996-2007 and forecast to 2012 95
Figure 51: Housing transactions (England & Wales) 1997-2007 and forecast to 2012 98
Figure 52: Retail spending value, volume and inflation/deflation trends 1997-2007 and forecast to 2012 104
Figure 53: Retail spending as percentage of total consumer spending 1997-2007 and forecast to 2012 105
Figure 54: Consumer, retail and non-retail spending trends % 1997-2007 and forecast to 2012 106
Figure 55: Retail sales by location 2007 and 2012 108
Figure 56: Share of turnover by location 1997, 2002, 2007 & 2012 111
Figure 57: % share of store numbers by location 1997, 2002, 2007 & 2012 115
Figure 58: % share of space by location 1997, 2002, 2007 & 2012 117
Figure 59: Online retail spending 1997-2012 124
Figure 60: Verdict forecasting methodology 2008 129
