Even though, August tends to be a relatively ‘small’ month in terms of garden sales values, the uplift is encouraging for garden centres and their suppliers. Garden categories were 7% up on August 2023, providing a welcome springboard for autumn gardening categories such as bulbs in the coming months. Non-garden categories such as catering continued to perform strongly, underlining the strengths of garden centres as destinations.
Consumer confidence remains buoyant, in part supported by continued high levels of wage growth
relative to inflation in the cost of goods – the pound in the consumer’s pocket to some extent is going
further than a year ago.
These factors, whilst encouraging, don’t disguise the fact that 2024 has proved challenging for garden centres, growers and the manufacturers supplying them. Year to date sales in garden categories, including plants, are down 4% on 2023. Businesses continue to face cost pressures, and whilst wage growth is proving good for consumer confidence, maintaining competitive wage increases presents a significant challenge. Given the changes in the Low Pay Commission’s remit (and the possible abolition of age bands in the minimum wage), there is potential for further growth in wages costs to impact on businesses in 2025.
However, the strong August sales performance provides some confidence and reassurance that consumer demand for gardening remains strong, with subdued sales in 2024 being driven by the weather rather than any fundamental changes in consumer attitudes to gardening, gardens, or garden centres.
Fran Barnes, Chief Executive of the HTA, commented: “With the weather constantly proving a challenge for our retailers, it’s encouraging to see gardening categories continuing to improve year on year. The strong August sales performance gives confidence and reassurance that consumer demand for gardening remains strong, with subdued sales months driven by the weather rather than any fundamental changes in consumer attitudes to gardening, gardens, or garden centres.
In part, this consumer confidence is supported by continued wage growth relative to inflation in the cost of goods. Pay growth was 5.1%, which exceeded inflation and boosts – which means the pound in the consumer’s pocket, to some extent, is going further than a year ago. The industry continues to face cost pressures due to trade and labour, and even though global shipping costs fell substantially in August, they remain high compared to a year ago.
Our report shows the resilience of garden centres and their strength as community destinations, which we expect to see grow especially in the autumn months and before Christmas, although this doesn’t take away from how difficult 2024 has been for our retailers.”
The full August 2024 HTA Market Update report is available to HTA members.