Builders Merchants Market Report – UK 2021-2025
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The report contains an in-depth analysis of the UK builders’ merchants sector, including market structure, recent market and future trends, along with supplier and regional analysis.
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The 17th Edition of the Builders Merchants Market Report – UK 2021-2025 has been published, incorporating original input and primary research, the report contains an in-depth analysis of the UK builders’ merchants sector, including market structure, recent market and future trends, along with supplier and regional analysis.
Key Issues Covered in the Report
- Merchants’ Market Performance – size, recent trends and key influences, forecasts and development to 2025.
- Market Structure – review of market structure and segmentation according to region and employment and turnover sizebands.
- Analysis by Product Group – market size, overall product mix, sector trends and merchant share of sales.
- Key Sectors – analysis of key end use sectors, construction trends, developments and opportunities.
Some of the companies featured:
Travis Perkins Ltd, Wolseley UK, Saint-Gobain Building Distribution, Jewson, Ibstock, Butterley, Hanson, Gyproc, LPD Doors, Marshalls, Bosch, BG Electrical, George Boyd, Makita, Yale, Polypipe, Supreme Concrete, Velux, Grafton Group, Screwfix Direct,
Areas of Particular Interest
- Market development in 2016-21 – driven by the effects of Covid-19 and wider construction and refurbishment activity, including both the residential and non-residential construction sectors.
- Industry developments including greater penetration of e-commerce and online sales, recent environmental legislation and supply chain considerations for building materials.
- Product group analysis – review of key product sectors, including market size, growth rates and merchant shares.
- Industry supply – review of key national, regional and local operators, including financial details and recent corporate activity.
- Market prospects to 2025 – including a review of key market drivers and influences.
KEY AREAS COVERED IN THE REPORT
Market Overview
- UK builders’ merchants’ market – including market definition, market size by value, recent and current situation 2015-2020 with estimates for 2021, recent market performance, growth.
- Market breakdown – analysis of the merchants’ market segmented according to turnover and employment sizebands, as well as by region.
- Key market influences – including construction output, residential housing market, growth of e-commerce and legislation.
- Customer profiles – housebuilding and construction firms, contractors, consumers and the public sector.
- Market prospects – market size, key growth areas, market developments and forecast trends up to 2025.
Product Sectors
- Market mix by product – mix and sector trends 2020, factors influencing each sector, presence of merchants compared with other distribution rivals.
- UK market for HVAC products 2016-2025 – key product mix and trends and sector development.
- UK market for timber & glazing products 2016-2025 – key product mix and trends and sector development.
- UK market for bricks, blocks, building envelopes & concrete 2016-2025 – mix by product type and sector development.
- UK market for cement & plaster 2016-2025 – product trends and sector development.
- UK market for domestic kitchens 2016-2025 – product trends and sector development.
- UK market for plumbing & drainage products 2016-2025 – product trends and sector development.
- UK market for bathrooms 2016-2025 – product trends and sector development.
- UK market for roofing & insulation products 2016-2025 – product trends and sector development.
- UK market for decorating materials 2016-2025 – product trends and sector development.
- UK market for other building materials 2016-2025 – key product mix and trends and sector development.
Supply and Distribution
- Merchants’ customers – builders, plumbing & heating contractors, M&E contractors, consumers, the public sector.
- Leading distribution competitors– DIY/home improvement multiples, specialist trade distributors, direct supply and online retailers.
In 2020, merchant sales accounted for 8.5% of total construction output in the UK. Although this was down from almost 9% four years earlier, it represented a slight increase compared with 2019, with many merchants having been able to stay open and continue trading during lockdown periods.
Environmental legislation remains at the forefront of much of the UK’s construction activity, with the continued emphasis upon more efficient forms of energy within buildings, as well as the use of sustainably sourced materials and eco-friendly construction methods.
Prospects for the builders & plumbers’ merchants’ market remain broadly positive over the next five years. However, the performance of the market remains heavily dependent upon construction activity and the UK economic situation, as well as whether the vaccination programme can halt the potential spread of new strains of Covid-19.
Advances in technology are also set to change the way supply chains operate as far as construction and building materials are concerned, specifically those existing between merchants and their suppliers. Greater digitalisation is expected to ensure greater traceability of building materials moving throughout the supply chain, as well as use of artificial intelligence (AI) to predict future product demand.
Nevertheless, opportunities should continue to emerge for merchants, especially given the current enthusiasm for building projects at government level. Those embracing the switch to online sourcing and purchasing are likely to represent the best performers over the next five years.
CONTENTS
1. INTRODUCTION 7
1.1 INTRODUCTION 7
1.2 SOURCES OF INFORMATION 7
2. SUMMARY & MARKET PROSPECTS 9
2.1 SUMMARY 9
2.2 MARKET PROSPECTS 10
3. MARKET DEFINITION & STRUCTURE 13
3.1 DEFINITION 13
3.2 PRODUCTS 13
3.2.1 Product Range 14
3.3 MARKET STRUCTURE 15
3.3.1 Lightside Product Distribution 19
3.3.2 Heavyside Product Distribution 19
3.3.3 Buying Groups 19
4. MARKET SIZE & SEGMENTATION 23
4.1 TOTAL MARKET SIZE 23
4.2 MERCHANTS’ SHARE OF CONSTRUCTION OUTPUT 25
4.3 MARKET SEGMENTATION BY PRODUCT SECTOR 26
4.4 PRODUCT TRENDS 28
4.4.1 Heating, Ventilation & Air Conditioning (HVAC) 28
5.4.2 Timber & Glazing 31
4.4.3 Bricks, Blocks, Building Envelopes and Concrete (BBBEC) 33
4.4.4 Cement & Plaster 35
4.4.5 Domestic Kitchens 36
4.4.6 Plumbing and Drainage 38
4.4.7 Bathrooms 39
4.4.8 Roofing & Insulation 41
4.4.9 Decorating 43
4.4.10 Other Products 45
5. FIVE YEAR FORECASTS 49
5.1 FUTURE MARKET SIZE FORECASTS 49
5.2 CURRENT & FUTURE INFLUENCES 50
5.2.1 The Housing Market 50
5.2.2 Non-Residential Construction 53
5.2.3 Growth of E-commerce 55
5.2.4 Future Construction Trends 57
5.2.5 Cost of Building Materials 58
5.2.6 Environmental Legislation 59
6. REGIONAL ANALYSIS 61
6.1 REGIONAL CONSTRUCTION TRENDS 61
6.2 REGIONAL SEGMENTATION OF MERCHANTS 64
7. MERCHANTS’ CUSTOMERS 66
7.1 BUILDERS 66
7.1.1 Housebuilders/General Builders 66
7.1.2 Commercial Construction 69
7.1.3 Civil Engineering 72
8.2 PLUMBING & HEATING CONTRACTORS 73
7.3 MECHANICAL & ELECTRICAL CONTRACTORS 75
7.4 OTHER CUSTOMERS 77
8. THE BUILDERS & PLUMBERS MERCHANTS 79
8.1 MARKET SHARE 79
8.2 MERCHANT COMPANY PROFILES 82
8.2.1 National Merchants 82
8.2.2 Large Regional Merchants 86
8.2.3 Medium & Small Size Regionals 92
8.2.4 Local Merchants 95
8.3 CHARACTERISTICS OF BUILDERS & PLUMBERS’ MERCHANTS 96
8.3.1 Profitability 96
8.3.2 Turnover Per Employee 97
8.3.3 Pricing and Prices 97
8.4 MERCHANTS’ MARKET – SWOT ANALYSIS 99
8.5 MERCHANTS’ COMPETITORS 101
APPENDICES 103
APPENDIX A: ECONOMIC ENVIRONMENT 103
A.1 OVERVIEW AND OUTLOOK 103
A.2 GDP 103
A.3 INFLATION & INTEREST RATES 105
A.4 EMPLOYMENT & WAGES 105
A.5 HOUSEHOLD CONSUMPTION 106
A.6 STERLING 107
A.7 TRADE & BUSINESS INVESTMENT 108
RESEARCH SERVICES OFFERED BY AMA RESEARCH 110
TABLES AND CHARTS
TABLE 1: PRODUCT CATEGORY DEFINITIONS 14
CHART 2: BUILDING PRODUCTS DISTRIBUTION STRUCTURE 15
CHART 3: UK BUILDERS AND PLUMBERS’ MERCHANTS’ MARKET 2016 TO 2025 – BY VALUE (£BN MERCHSP) 23
TABLE 4: MERCHANTS’ SHARE OF UK CONSTRUCTION OUTPUT 2016 TO 2021 (£BN) 25
CHART 5: PRODUCT MIX – BUILDERS AND PLUMBERS’ MERCHANTS 2020 26
TABLE 6: MERCHANTS’ SHARE OF MARKET SECTORS 2020 (£M MERCH SP) 27
CHART 7: THE HEATING VENTILATION & AIR CONDITIONING MARKET 2016 TO 2025 BY VALUE (£M MERCHSP) 28
CHART 8: PRODUCT MIX HEATING, VENTILATION & AIR CONDITIONING PRODUCTS 2020 – % BY VALUE 30
CHART 9: UK MARKET FOR TIMBER & GLAZING PRODUCTS 2016 TO 2025 – BY VALUE (£M MERCHSP) 31
CHART 10: PRODUCT MIX TIMBER & GLAZING PRODUCTS 2020 – % BY VALUE 32
CHART 11: UK MARKET FOR BRICKS, BLOCKS, BUILDING ENVELOPE & CONCRETE 2016 TO 2025 (£M MERCHSP) 34
CHART 12: UK MARKET FOR CEMENT & PLASTER 2016 TO 2025 – BY VALUE (£M MERCHSP) 35
CHART 13: UK MARKET FOR DOMESTIC KITCHENS 2016 TO 2025 – BY VALUE (£M MERCHSP) 37
CHART 14: UK MARKET FOR PLUMBING & DRAINAGE 2016 TO 2025 – BY VALUE (£M MERCHSP) 38
CHART 15: UK MARKET FOR BATHROOM PRODUCTS 2016 TO 2025 – BY VALUE (£M MERCHSP) 39
CHART 16: UK MARKET FOR ROOFING & INSULATION 2016 TO 2025 – BY VALUE (£M MERCHSP) 41
CHART 17: UK MARKET FOR DECORATING MATERIALS 2016 TO 2025 – BY VALUE (£M MERCHSP) 43
CHART 18: PRODUCT MIX FOR ‘OTHER’ PRODUCTS 2020 – % BY VALUE 45
CHART 19: ILLUSTRATING MARKET PERFORMANCE ALONGSIDE TOTAL UK CONSTRUCTION OUTPUT FOR THE PERIOD 2020-2025 49
TABLE 20: HOUSE BUILDING STARTS & COMPLETIONS (GREAT BRITAIN) 2016 TO 2025 – BY VOLUME (DWELLINGS) 50
CHART 21: NON-DOMESTIC CONSTRUCTION OUTPUT (GREAT BRITAIN) NEW WORK & RMI – CURRENT PRICES (£BN) 2016 -2025 53
CHART 22: NON-RESIDENTIAL CONSTRUCTION OUTPUT NEW WORK BY SECTOR 2020 AND 2025 – % BY VALUE GB 54
CHART 23: GROWTH FORECASTS OF END-USE SECTORS OF MERCHANTS’ MARKET, 2020-2025 55
TABLE 24: VALUE OF CONSTRUCTION NEW ORDERS BY REGION, DECEMBER 2018-2020 (£M) 62
TABLE 25: RESIDENTIAL CONSTRUCTION NEW ORDERS BY REGION, DECEMBER 2018-2020 (NUMBER OF UNITS) 63
TABLE 26: NUMBER OF UK MERCHANTS BY REGION 2017 & 2021 (NUMBER OF BUSINESSES) 64
CHART 27: REGIONAL BREAKDOWN OF MERCHANTS 2017 AND 2021 – % BY VALUE GB 65
TABLE 28: ENTERPRISES REGISTERED FOR VAT INVOLVED IN CONSTRUCTION OF BUILDINGS BY TURNOVER BAND 2017 & 2021 66
TABLE 29: ENTERPRISES REGISTERED FOR VAT INVOLVED IN CIVIL ENGINEERING CONSTRUCTION BY TURNOVER BAND 2017 & 2021 72
TABLE 30: PLUMBING, HEATING & AIR CONDITIONING INSTALLERS REGISTERED FOR VAT BY TURNOVER BAND 2017 AND 2021 73
TABLE 31: ELECTRICAL INSTALLERS REGISTERED FOR VAT BY TURNOVER BAND 2017 AND 2021 76
TABLE 32: UK BUSINESSES INVOLVED IN WHOLESALE OF BUILDING MATERIALS BY TURNOVER BAND 2019 & 2021 80
CHART 33: MIX OF MERCHANTS BY TYPE (NATIONAL, REGIONAL, LOCAL) 2020 80
CHART 34: LEADING MERCHANTS’ MARKET SHARES 2020 81
TABLE 35: TRAVIS PERKINS 82
TABLE 36: WOLSELEY UK 83
TABLE 37: SAINT-GOBAIN BUILDING DISTRIBUTION 84
TABLE 38: GRAFTON GROUP 85
TABLE 39: SCREWFIX DIRECT 86
TABLE 40: LEADING SMALLER REGIONAL MERCHANT COMPANIES 2020/21 95
TABLE 41: MERCHANTS’ TURNOVER PER EMPLOYEE 2017 TO 2020 97
TABLE 42: PERCENTAGE CHANGE OF PRICE INDICES OF CONSTRUCTION MATERIALS 2016-2020 (2015 = 100) 98
TABLE 43: PERCENTAGE CHANGE OF PRICE INDICES OF CONSTRUCTION WORK 2016-2020 (2015 = 100) 99
TABLE 44: MERCHANTS’ MARKET SWOT ANALYSIS 100
TABLE 45: VALUE SALES OF RETAILERS OF DIY PRODUCTS 2015-2020 (INDEX 2019=100) 102
CHART A1: GROSS VALUE ADDED BY SECTOR 104
CHART A2: CPI INFLATION AND BANK OF ENGLAND BASE RATE 105
CHART A3: AVERAGE WEEKLY EARNINGS BY SECTOR 106
CHART A4: DISPOSABLE INCOME PER CAPITA & SAVINGS RATIO 107
CHART A5: STERLING EXCHANGE RATES TO THE DOLLAR AND THE EURO 108
CHART A6: TRADE & BUSINESS INVESTMENT, 2018-2020 109
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- Analysis by product group – market size, product mix, sector trends etc.
