Summary
• The grow-your-own market is still very strong.
• M&M Timber shipped out 16,000 veggie beds in January.
• Stock should be ordered in good time to avoid possible supply chain shortages.
• Decorative or luxury products are likely to be a harder sell than more functional ones.
The winter nights may still be long and the talk may still be of snow, but garden product manufacturers are already immersed in the spring market.
Last September’s Glee provided the inspiration for much of the pre-2010 season ordering and the trend for home-grown fruit and vegetables has translated into healthy sales, particularly for those manufacturers with a strong focus on garden centre business.
“Our grow-your-own range has gone down very well with retailers,” said Vicky Nuttall, head of marketing at Forest Garden, which has a £48m turnover and about 35% of market share.
“Along with the raised beds, our mini-greenhouses have been taken up by a significant number of retailers. We’ve also been really pleased with the response to our kitchen garden trough. Its depth means you can plant deep-rooted vegetables, while its height means it’s ideal for people with restricted mobility – and it looks really good, too.”
Coldframes and greenhouses
It’s a similar story at M&M Timber, which picked up several new garden centre customers at Glee last year, including the Royal Warrant-holding Hillier Garden Centre Group. “The grow-your-own trend is very much alive and kicking,” said managing director Nigel Poyner. “Coldframes and greenhouses are very in vogue and we shipped out nearly 16,000 veggie beds in January – and just to put that into perspective, we sold 22,000 in the whole of 2009. We’ve seen more pre-seasonal orders, with customers committing to taking stock in January than in the last three years.”
Hillier has placed an order for several hundred veggie beds, while the Morrison supermarket chain is buying 1,600 as part of its “Let’s Grow” campaign.
M&M Timber’s new greenhouse range has also taken off and, said Mr Poyner, garden centres are placing early orders for the company’s newly-introduced cold frames, grow bag stands, herb troughs and half-round timber planters.
He added that while stock levels were good before Christmas, they probably weren’t ahead of the December 2008 level, thanks to a season that extended through the autumn and into winter.
“Demand for garden products went on a lot longer than normal in 2009,” he said. “We had an order for 80 trellis panels the week before Christmas – that’s almost unheard of.”
Forest Garden also experienced a pre-Christmas demand spike thanks to the high winds in late November/early December. “That had a big impact on us and we saw an uplift of nearly 150% for fencing panels compared to the same time last year,” said Ms Nuttall. “Production is normally relatively quiet at that time of year, but we had to wind it back up again.”
Snow put garden projects on hold in January and helped manufacturers build stocks in readiness for the peak season but, according to Duncan Hill, managing director at Grange Fencing, “there’s still time for a storm between now and Easter and that would sort the men out from the boys”.
Building stocks
Grange, which turns over £33m and supplies almost 3,000 miles of fencing per year, has been concentrating on building stock and investing in extra storage capacity and more flexible manufacturing. This includes bringing 40% of the manufacturing of the recently acquired Metpost back from the Far East to a new
factory at Grange’s Telford base, which will enable them to be supplied just in time.
“Our number one priority is service and we aim to deliver in full, on time, every time,” said Mr Hill. “So we decided to work between Christmas and New Year, rather than have our usual two-week shutdown. We’re now holding more stock of finished product and components than ever before because I think there’s going to be a supply chain crunch.”
He believes that destocking throughout the supply chain, coupled with recent closures of European mills specialising in fencing components, could lead to shortages and that merchants and retailers who leave ordering for Easter to the last minute could come unstuck. “If a retailer or merchant doesn’t have it when he wants it, he can’t sell it,” he said.
“The most important challenge for the fencing industry is to gear up for Easter so as to run through the peak season without any fall-off in the quality of service,” he added.
Jacksons Fencing, based in Ashford, Kent, supplies the fencing contractor and consumer markets and is also working hard to maintain healthy stock levels. It differs from its trade-oriented counterparts in that it doesn’t encourage contractors to stock too much.
“We don’t expect them to commit to it, so we’ve been investing since the end of October to build stock for all our customers,” said managing director Richard Jackson. “We had over £4m of stock in December and that will continue to rise until the season kicks off.”
Jacksons’ premium fencing has been selling well and Mr Jackson expects that to continue as consumers “slowly come around to the idea of lifetime costs”. Current best-sellers are the Venetian slatted panel, the Chilham “good both sides” panel and the Jakacoustic barrier.
“The idea of the garden being an extra room to the house is still to the fore and if we get a half-decent spring, that will exaggerate that view and people will look for something slightly different,” he said.
Functional over luxury
The trick, say manufacturers, is to predict not just the volumes required by their customers, but the product mix, and the word is that 2010 will see more demand for “functional” products than those that may be perceived as luxury. The more decorative products may still be listed, but are more likely to be “in penny numbers”, or available by special order.
“If I had to advise customers to stock up on certain products it would be grow-your-own ranges and commodity products such as traditional trellis and value-for-money arches,” said Nigel Poyner. “I think the decorative market is going to be harder and some retailers who have found themselves overstocked and with a lot of cash tied up in it in the past will now just stock the more back-to-basics lines.”
Forest Garden agrees that now is the time to stock up on core constructional products such as fence panels, which always sell early in the year, and says it’s the ideal time to target those consumers who are starting to plan their fruit and vegetable production.
Grow your own
The latter is an emerging sector, but it hasn’t been at the expense of Forest’s more decorative items. “Some of the grow-your-own market is needs-based, but there is still a ‘wants-based’, more aspirational market out there,” said Vicky Nuttall. “Many consumers are spending more money in their garden, rather than moving house, and an arch or arbour can make a big impact and not be massively expensive.
“There has been a little less demand for big ticket items such as summerhouses, and generally there has been a shift back to more commodity products, rather than the higher value items – but they’ve not gone completely,” she continued.
What may happen, however, is that the rate of stock turn will become even more important to retailers’ purchasing decisions and, says Grange’s Duncan Hill, there is scope to improve the appearance of those products that do stay on the shelf. “We’ve invested in an improved wood stain and we reckon the colour hold on our [dip-treated] fence panels is at least 18 months, so they’ll look fresh and good on the shelf – even though they’re not likely to be there very long.”
The challenge for the fencing industry, he said, is to reproduce that long-lasting colour on the pressure-treated premium products that do stay on the shelf longer and have a greater need to maintain a fresh appearance.
While Easter is still to come, garden product manufacturers are already looking beyond this spring to Easter 2011 and are developing ranges to launch at Glee this September. “We have forecasting systems in place and work with customers as closely as possible to understand what the demand is likely to be,” said Vicky Nuttall. “We always try to work ahead of the game.”