The UK china and earthenware market grew by only 1.7% to reach a value of £1.33bn in 2013, according to a new report.
Market intelligence provider Key Note’s 2014 Market Update, ‘China & Earthenware 2014’, said this figure represents “slow growth, well below the rate of inflation, in a market that continues to suffer from declining volume sales”. It notes that the downward trend was partially offset by events such as the birth of Prince George and the growing demand for British-made goods but that “nevertheless, trading conditions remain challenging”.
The study points out that commemorative products that celebrate royal occasions are a significant sales driver in the ‘ornamentalware’ sector of the market. “The regularity of recent royal events has prevented general sector decline; decorative ceramics are increasingly considered old-fashioned by UK consumers,” Key Note claims. The marriage of the Duke and Duchess of Cambridge in 2011 and the birth of their first son Prince George in 2013, combined with The Queen’s Diamond Jubilee in 2012, all contributed to sales in this sector. Key Note said: “The popularity of the British monarchy, both domestically and internationally, is experiencing a surge, and exploitation of this by companies such as Emma Bridgewater has prevented poor sector performance in the last three years.”
The survey suggests that consumers’ growing desire to support British manufacturing and thus pay a little extra, has been offset by the long-term decline in marriage and the slow recovery from the financial crisis. “High-quality items in this sector are traditionally given as gifts at weddings, but the gradual decline in marriage penetration over the last 30 years has restricted volume sales in this context,” Key Note said. “Moreover, despite gradually improving economic circumstances, the effects of this are yet to reach many consumers’ pockets; a significant number of Britons are still being forced to prioritise spending on more essential goods. Both these trends have reduced volume sales.”
Key Note concludes that the retail environment will remain challenging in coming years, particularly for smaller retailers in the china and earthenware market. “Market consolidation will continue as larger multiples increasingly exploit growing brand awareness and multi-channel selling strategies,” Key Note said. “In production terms, companies will be able to successfully exploit the demand for British goods, but will have to contend with rising energy costs in an energy-intensive industry. The lack of upcoming royal occasions only exacerbates an already difficult trade outlook.” As such, between 2014 and 2018, Key Note forecasts limited growth of 2.5%.