Uk Furniture & Floorcoverings Retailers 2010-aarkstore Enterprise Market Research
UK Furniture & Floorcoverings Retailers 2010
Table of Contents :
CHAPTER 1 EXECUTIVE SUMMARY 6
Key findings 6
Summary 7
Furniture and floorcoverings is the hardest hit out of all retail sectors 7
Furniture has marginally outperformed floorcoverings 7
Inflation is set to return to the market 7
Specialists are set to struggle from the increased threat of non-specialists 8
DIY specialists are set to gain a greater share of the furniture market 8
IKEA has overtaken Home Retail Group for the number one spot in furniture 8
Administrations have heavily affected the major floorcoverings specialists 9
Carpetright has accelerated its share gains 9
The market is set to evolve away from being solely price-driven 9
Growth will become harder to achieve in 2010 10
The internet is set to become more important for retailers 10
Kitchens are set to become a strong growth area 10
CHAPTER 2 MARKET ANALYSIS 12
Market definitions 12
Overview 13
The recession caused a sharp fall at the end of the decade 13
Furniture remains the dominant sector in the furniture and floorcoverings market 16
Furniture 17
The housing downturn has reversed the trend in a previously buoyant market 17
Beds and bedroom furniture 18
Upholstery 19
Dining and living room furniture 19
Kitchen furniture 19
Bathroom furniture 19
Home office furniture 20
Floorcoverings 21
Floorcoverings has underperformed compared to furniture 21
Carpets and rugs 22
Hard floorcoverings 22
Vinyl and linoleum flooring 22
Furniture specialists 24
Furniture specialists 24
Floorcoverings specialists 26
Channels of distribution 28
DIY retailers are the big winners in the challenging furniture market 28
Multiple specialists 28
Independent specialists 28
DIY retailers 29
Department stores 29
Catalogue showrooms 29
Remote retailers 29
Other 30
Specialists still hold the dominant share in the floorcoverings market 31
Independent floorcoverings specialists 31
Multiple floorcoverings specialists 31
DIY retailers 32
Department stores 32
Multiple and independent furniture specialists 32
Remote retailers 33
CHAPTER 3 COMPANY DATA ANALYSIS 34
Furniture market shares 34
Floorcoverings market shares 37
Key operating statistics 39
Advertising 41
CHAPTER 4 OUTLOOK 43
The role of websites in furniture and floorcoverings 43
Shopping for furniture and floorcoverings online has its problems 44
A website must convey the retailer's brand 45
Less capacity will be freed up in 2010 46
The housing market is set to remain sluggish 47
The housing market may stall again in 2010 48
Impact of the 2010 general election 50
Public sector cuts and higher levels of tax are likely, whichever party is elected 51
Each party has suggested different ways to stimulate the housing market 52
A hung parliament could negatively affect retail 52
Margin pressures 53
Attempts to stimulate the market have been ineffective 53
Rise of the non-specialist 55
Non-specialists are able to be more flexible than specialists 57
The market is no longer just about price 58
Consumer demands are changing 58
Major opportunity for specialists 59
Carpetright and Dreams have tailored their strategies 59
Delivery will now become a key battleground 59
Kitchens is set to become a growth area 61
Retailers are positioning themselves to take advantage of growth 62
Investment must not be a one-off thing 62
CHAPTER 5 DFS 64
Private equity support provides future foundations 64
Recent key events 65
Sold to private equity group following review 65
DFS conducted a strategic review to consider refinancing opitions 65
Doubts remained over whether the business would be sold at all 65
DFS was eventually acquired by Advent International 65
The retailer is considering launching a transactional website 65
DFS is continuing to promote itself to create top-of-mind awareness. 66
Proposition 67
Financials 69
DFS' deteriorating sales highlight the challenging furniture market 69
Space 73
DFS is looking to expand its store portfolio again 73
Sector performance - furniture 75
DFS' market share continues on an upward trend 76
Outlook 77
Outlook 77
Private equity backing is set to make DFS stronger still 77
Private equity investment will provide DFS with a platform to grow 77
DFS' current performance is commendable in such a challenging market 77
Moving onto the high street could also be positive for the business 77
DFS must be wary of the rise of the non-specialist 77
Launching a transactional website is an important step for the retailer 78
Continued promotional spend has been a sensible stratergy 78
While price is important, changing the message of its adverts may help them 78
CHAPTER 6 DREAMS 79
Leading bed specialist prospers in recession 79
Recent key events 81
Dreams' new owners have bank-rolled expansion 81
Exponent buys Dreams 81
Deal with British Land 81
Dreams wins recycling award 81
Proposition 82
Financials 84
Underlying profits improve on strong sales growth 84
Space 88
Dreams continues to expand, despite the recession 88
Sector performance - furniture 90
Dreams' market share continues upward progress 91
Outlook 92
Dreams is well placed for further growth 92
Trading will become more challenging 92
The Dreams brand continues to strengthen 92
In-store presentation could be improved 92
Older consumers present an opportunity 93
Longer term expansion is possible beyond the UK 93
CHAPTER 7 FURNITURE VILLAGE 94
Caution has paid dividend at Furniture Village 94
Recent key events 95
Furniture Village has broadened its brand appeal 95
Furniture Village celebrated its 20th birthday in 2009 95
Launch of FV essentials 95
Acquisition of World of Leather brand 95
New store openings 95
Furniutre Village has worked to improve the service levels of its supply chain. 96
Have made improvements to its online offer. 96
Proposition 97
Financials 99
Profits drop as sales growth reverses 99
Space 103
Controlled expansion is set to continue 103
Sector performance - furniture 105
Furniture Village has seen a gradual increase in its market share 106
Outlook 107
Furniture Village is well placed for expansion when demand recovers 107
Quality positioning is preserved 107
There is clear potential for building a larger store estate 107
Potential to develop sales online 107
Further investment is needed to expand the home office and bedroom offerings 108
CHAPTER 8 HOMESTYLE 109
Proves resilient to recession 109
Recent key events 110
Homestyle has expanded despite the recession 110
Acquisition of Reid Furniture 110
Launch of Homestyle stores 110
Proposition 112
Financials 116
Homestyle's margins have defied the recession 116
Space 119
Homestyle has resumed the expansion of its portfolio 119
Sector performance - furniture 123
Homestyle has experienced strong gains in market share 126
Outlook 127
There is potential for renewed growth 127
Robust margins will provide a platform for growth 127
There is scope to capitalise on the glut of empty units 127
Reid acquisition will strengthen Homestyle 127
Homestyle's bed businesses will lose ground to Dreams 127
CHAPTER 9 IKEA 129
IKEA's value offer and new stores provide growth 129
Recent key events 130
IKEA adapts to volitile internal and external enviroments 130
Significant upheaval in IKEA's board of directors 130
The retailer has changed its strategy to reflect current market conditions 130
IKEA still plans to expand into new markets, although it has shifted focus away from others 130
IKEA has looked to promote its kitchens offer 131
IKEA acquires a retail park 131
The retailer has continued working on its multi-channel offer 131
Pr
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