A View on the Garden Season 2012 – Trade and industry are optimistic

Weather conditions play a significant role in the success of the garden supply business. Trade and industry are optimistic about the 2012 gardening season, as the trend towards ‘outdoor-living’ continues. According to experts in the sector, the demand for high-quality products is still strong.

The Association of German Sporting Goods Manufacturers (BSI) can look back on a successful 2011. Many BSI member companies report sales increases in the high single-digit region. More and more, consumers are prepared to pay a higher price for better quality and products that are manufactured in a sustainable manner. Because of strong pre-orders for the current year and the very positive start to the present season, the BSI and its member companies have high expectations for spoga+gafa 2012 and the 2013 buying season.

The German Garden Industry Association (IVG) reported that there were some clear winners in 2011 – in particular in relation to grill related merchandise. However, the greenery, outdoor, garden furniture and ceramics and decorations product ranges also performed well. Powered garden equipment manufacturers also reported satisfactory growth. The IVG believes that the trend toward using the garden as a place to relax, pursue leisure activities and express oneself creatively will continue undiminished. The cultivation of fruit and vegetables is also enjoying a comeback.

According to the Barbecue Industry Association (BIAG) the trend towards outdoor living and the barbecue culture are having a complementary effect on each other. Barbecuing is developing into a cultural phenomenon and is becoming a year round-activity. Customers want to have fun ‘outdoors’, and are ready to pay more money for high quality or more individualised equipment

The BHB – Retailers’ Association for Building, Home Improvement and Gardening – is reporting an exceptionally good start to 2012. In 2011, the gardening segment of building and DIY stores posted gross turnover of around 4.1 billion Euros – two per cent more than the figure for the previous year.

The German Garden Centre Association (VDG) reports that most garden centres ended 2011 with a healthy increase in turnover. Especially stores offering a large variety of merchandise or an inviting catering area where customers could linger were able to benefit according to the VDG. Furthermore, garden centres run by owner-operators benefited from their expert know-how. The VDG noted that demand for brand-name products and regional products was particularly high in 2011. This year has also started very well for garden centres.

 

European press conference: spoga+gafa 2012

Katharina C. Hamma, managing director of Koelnmesse, informed in May during in a press conference journalists from 15 nations about the international garden fair spoga+gafa.

The global meeting for everyone working in the gardening or recreation sector takes place from 2nd to 4th of September 2012 in Cologne, Germany.

Nielsen: Increasing global consumer confidence

Global consumer confidence increased five index points to 94 in Q1 2012, according to global consumer confidence findings from Nielsen. Nielsen is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement, trade shows and related properties.

Households around the globe experienced brighter personal situations in terms of jobs and personal finances last quarter, especially in the U.S. and Asia, which was reflected with improved consumer confidence and higher discretionary spending,” said Dr. Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen. “While global economic conditions are more stable than in the depths of the European sovereign debt crisis late last year, underlying economic conditions are still fragile and fluid in many parts of the world, which could affect consumer confidence and spending momentum for the coming quarter.”

In the U.S., consumer confidence rose nine points to 92, its highest level since before the recession while China’s consumer confidence increased two points to 110, its highest level since the inception of Nielsen’s index in 2005.

The biggest quarterly confidence gains last quarter came from Taiwan (+13), Chile (+11) the United States (+9), Venezuela (+9), Malaysia (+6), Denmark (+6), Estonia (+6), Saudi Arabia (+6), United Kingdom (+6), and Peru (+6).

India remained the world’s most optimistic market for the ninth consecutive quarter with a one point consumer confidence increase to 123, followed by Saudi Arabia (119), Indonesia (118) and the Philippines (118). Hungary was the world’s most pessimistic market at 32 index points, followed by Greece (37) and Portugal (39).

For further information: nielsen.com

 

News from the chainsaw message-bearer

The message that Dr. Bertram Kandziora, CEO of the Stihl AG & Co. KG, carried at the press briefing on annual results could not have been better: 10.8 per cent growth in 2011 with a record turnover of 2.6bn Euros and excellent prospects for the future development of the company.

“We have been able to strengthen our position in the worldwide market due to our widespread product line and our unique structure of distribution. I am confident that this trend will continue in the current and in the following year,” said Dr. Kandziora. Traditionally, the German market was stable and sound with a share of some 10.6 per cent of the total turnover, but foreign markets significantly contributed to last year’s extraordinary yield. Especially in several regions in Eastern Europe and some Asian and Latin American threshold-countries sales-figures rose above average. This also earmarks the company’s longstanding foreign activities. Their distribution company in Canada celebrated its 30th anniversary last year with further jubilees celebrated in Hungary (20 years) and South Africa (15 years).

For decades, Stihl’s key to success is the quality and reliability of their products. “Last year,” stressed CEO Dr. Kandziora, “our art of engineering reached yet another peak with the development of the first electric fuel injection in a hand-held motor-driven device.” Indeed, the new Stihl angle grinder TS 500i was equipped with this brand new technology. Although its fuel consumption was reduced by 15 per cent, it nonetheless has 20 per cent more power than previous models. This year Stihl will introduce some new chainsaws and sweepers.

After the very promising first quarter of this year and with the company’s policy of careful planning and flexible production capacities the CEO’s forecast may well come true.

More information: stihl.de

 

Crisis? What crisis?

The economies in our united Europe are still pretty different from each other. While some markets bloom, others are close to wilting. This, of course, has its effects on the garden and leisure industry, too.

“Way to go!” they may say in Germany and The Netherlands. Their GDP (gross domestic product) is growing and their groovy home markets are a good place to knock down. The spending behaviour is very promising for the leisure and garden industry, especially now with the beginning BBQ-season. Almost every night TV ads for barbecues and bangers are on the box and DIY-superstores sell a chunk of barbecues, charcoal and garden furniture.

This, however, is different in Spain. Although the Spanish economy is not nearly as sick as the one in Greece, they are in dire straits. Youth unemployment only recently reached its peak by almost 50 per cent and Spanish retailers eat their heart out for a speedy recovery of the home market. The situation in Italy is almost the same, but, furthermore, the Italians had to overcome yet another government crisis. Could it get any worse? Yes, it could, if you look at Portugal. Their GDP has fallen very steeply and thus the home market almost vanished. But according to Murphy’s Law, if one thing goes wrong, there will be soon another problem. And so it did in Portugal. The government increased VAT on plants from six to 23 per cent, payable within 45 days – although the government itself takes 200 days to settle its bills. Those nurseries that did not go bust as a result of the enormous VAT-rise had to fire 50 per cent of their work-force.

Hope dies last could be the motto for the nurserymen in the UK. The British currency is not joined to the Euro and thus they don’t have to pay their contributions to the rescue of the Greece economy, as the Euro-countries must do. However, the Sterling is bound by the exchange rate. If the Euro rate moves over €1.25 against the Pound the UK-market would become that more appealing to overseas competition. That is what the UK horticulture hopes for and it looks like they don’t have to hope until the cows come home.

The European garden and leisure market is astir. Some companies might go to the wall, as they already did in Portugal, but those who survive the crisis will be stronger than before. Even if the production level went down, this would make life better for those that remain. How do you see the future in your country? Rosy? Obscure? Dark? And what do you do to survive the crisis?