Current UK market
We operate in both the furniture and flooring markets, and there are a number of factors influencing both markets that may impact the business. These factors range from general consumer confidence levels to momentum in the housing market, and can also include challenging weather conditions, which affect store footfall.
Both of our core markets are heavily influenced by similar key factors:
Big ticket sales are affected by consumer confidence, which is heavily influenced by the political and economic environment in the UK, and most recently by the ongoing Brexit process. We track the GfK Consumer Confidence Index, which, as at the date of publication of our latest results, showed a fall to -14 in August 2019, down from -7 in August 2018.
The latest publication on the GfK Consumer Confidence Index can be found?here.
We are well aware that for many of our customers a house move triggers the purchase of new flooring and furniture. Since the recent peak in 2016 (the highest number since 2007), housing transactions have continued to fall, with total transactions for 2018 3.4% lower than the 2016 peak. Total transactions to August 2019 were 3.2% lower when compared to the same period in the prior year.
The latest housing transaction statistics can be be found?here.
Availability of consumer credit
With nearly half of our customers choosing to utilise our finance options to pay for their products,
the availability of consumer credit helps facilitate sales, and provide opportunities for upselling.
Current levels are at an all-time high, and continue to grow, although that growth began to slow in 2018 and through 2019.
The latest statistics on consumer credit can be be found?here.
Our advantages in the market
Our continued aim to provide a value proposition at a range of price points allows us to offer best-in-class prices to customers searching for the best deal.
Our product offering has continued to evolve in line with our strategy to broaden our appeal by offering a wider range of brands – including third party brands – as well as flooring, dining and occasional ranges.
Our partnerships with multiple finance houses will ensure competitive tension and drive the best cost prices and levels of acceptance for our finance offerings.
Our strategy targets the key areas we believe will improve our position in the industry in the coming years. There is still considerable room to grow our market share in both furniture and flooring.