Garden Centres Discuss Spring Performance

Garden centres have been talking to George Bullivant at Gardenforum about the challenges of this year's spring sales season.

Spring has not been great for garden centres. David Little of Poplars described it as very much a start and stop season with not enough starts and far too many stops. 

Most people are blaming the weather.  Mark Farnsworth of Yorkshire Garden Centres said it’s the worst spring weather I can remember in 9 years of being in the trade. 

Martin Stewart of Stewarts Garden Centres has never experienced such a difficult period in 43 springs at Stewarts Garden Centres.  “It’s been frustrating.”

Alan Roper, MD of Blue Diamond, agrees that it is weather connected but thinks there must be other factors at work too.  Higher interest rates and utility costs means consumers have less disposable income.

Sales down

Overall garden retailers are reporting garden centre sales (ex-restaurants) for January to May within the range of +4 to -5% compared to last year.  Performance appears to depend on when major investments were last made.  Most companies are level or slightly negative.

Given inflation this means volumes are down.  Haskins MD, Julian Winfield, spelled it out: The average number of units customers purchase per visit remains stable, and the increase in customer spending aligns with inflation. However, overall sales volumes for both retail and restaurants are still at 80% of pre-COVID levels. This suggests a decrease in customer visits.

Clothing and Food

Clothing and food appear to have been the fastest growing categories.  But the story of which categories have done well is not consistent.

For Hillier, Chris Francis explains that nursery stock has been the poorest performing with gardening categories generally faring worse. “Furniture has performed surprisingly well and appears to have settled into a more normal pre-covid sales pattern.”

For Blue Diamond the pattern is slightly different with fashion +22%, food halls +9%, while  garden & leisure and plant sales are down.

Tim Armstrong of Highfield reports that clothing, gift and food are showing double digit growth this year, bird food/care and books have been a major disappointment.

At Poplars the pattern is slightly different again.  “Still great volumes of plants, garden furniture and catering – but not showing the growth we might have had. Clothing has been a good performing category... Seeds and Bulbs have done well which has been a bit of a surprise,” says David Little.

Tong has found furniture very challenging and feels the customer is nervous about higher ticket item.

Tim Mason for Your Local Garden Centre group said, “Visitor numbers are steady but big ticket leisure items are not selling as strongly as we would like.  It has been quite good for core gardening.”

Restaurants up but are they profitable?

For most, restaurants have been the best performing category with growth for many of 10-15%, going as high as 19% at Highfield. 

Although, it is harder to earn a profit with the increase in utility costs and the minimum wage.

Alan Roper agreed that making them profitable is harder than before.  But without restaurants you can say good-bye to a proportion of a garden centre’s turnover.

Discounting

Tong is fed up with customers finding branded product cheaper online or through the distributor direct. “… on furniture over 50% of our range is now unbranded or in our own label to protect margin.”

Highfield has adopted a similar tactic, “BBQ and certain brands of furniture are a problem with online retailers, sometimes I really do despair of the amount these products are reduced by, as I feel [they] are just devaluing the product,” said Tim Armstrong.

“Most of our sales on furniture have been on exclusive Choice products so we have kept margins to where I would want them to be.”  Choice is a buying and marketing group for independent garden centres.

Sale figures are only half the story

Sales is only half the story.  In the next article we summarise how garden centres are dealing with increased costs and the threat to margins. 

This will be followed by a third article where garden centre bosses look ahead and consider the prospects for Christmas.

Source : Reproduced with kind permission from George Bullivant at Gardenforum

Image : wavebreakmedia / 124047661 / shutterstock.com

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