2014-01-22 13:49:04 - Home and Garden in Australia - a new market research report on companiesandmarkets.com
Home and garden declined by 1% in retail value terms in 2012, witnessing the expansion of private label offerings and cost-conscious consumers, who were less willing to part with their money. This led to weaker performance in 2012 than in previous years of the review period.
The softening housing market had a significant impact on home and garden in 2012. Stagnant and declining median house prices were linked to weak consumer confidence, which ensured Australians were less inclined to spend on big ticket items, such as home furnishings. Weak average housing prices also meant consumers were less inclined to invest in housing, and consequently renovation and new build activity slowed.
Home and garden is a fragmented market in Australia. There
are established, well-known players in mature categories, but the breadth of offerings and lack of many category crossover players ensures company footprints often remain quite specialised. Consequently, others accounted for 74% of retail value sales in 2012. The leading player was IKEA Pty Ltd, due to its exposure to a range of categories across both home improvement and gardening and its rapid, recent expansion in Australia..
Big box retailers continued to grow in popularity over 2012. Home and garden consolidated around these large players who benefit from offering a wide variety of products at low prices due to strong economies of scale. Although Australia´s two leading retail players, Woolworths and Wesfarmers, both compete in home and garden, their leadership is much less significant than in other industries. The leading home and garden retail brand Brunnings, owned by Wesfarmers Ltd, only accounted for 1% of retail value sales in 2012. The expansion of Woolworths and Lowes joint venture, Masters, was a key development in 2012.
Population growth, positive economic development, and consequent increases in new housing starts paint a rosy forecast picture for home and garden in Australia. Private label growth and a consolidated retail environment may put downward pressure on prices, meaning value growth could be subdued; however, demand for home and garden products should remain robust.
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