Covid will cost UK flooring £200m
November 6, 2020
Flooring industry analysts are estimating the Covid crisis will cost £200m in lost revenues in the UK for 2020. But 2021 is set for growth.
Economists at AMA Research forecasts a 10% decline in the £2bn UK floorcovering market by the end of the year due to trading restrictions and lockdown measures.
But the outlook is more positive. Jane Tarver, Senior Research at AMA Research comments “Despite the significant impact of Coronavirus in 2020 and disruption to supply chains, there are indications that the UK floorcoverings market is already starting to improve in H2 2020.
"Therefore, 2021 is forecast to return to growth of 3% to reach £1.95bn. Whilst an upward trend, this is still only on a par with 2016 levels," she says. "The floorcoverings market is then expected to grow by 4% per annum in 2022 and 2023, before easing back again to 3% in 2024, when it is forecast to be worth £2.2bn.
"Whilst this reflects steady, but modest growth in value terms, it also reflects heightened price competition from the sheer number of suppliers, including online.”
The current lockdown is having less of an impact. "The run up to the Christmas period is typically a busy time in the home decoration market. Many tradesmen and carpet fitters have already secured work for weeks, if not months ahead, despite some supply chain disruption," says AMA.
"Whilst this aids recovery in the carpet sector, the pace of roll out is still likely to be gradual, given labour and possibly some material shortages."
Researchers also warn that the uncertainty around Brexit and the outcome of potential trade deals also remains a risk, given the sector’s dependence upon imports and the relative weakness of the pound, This has the potential to impact upon prices and cause potential supply chain issues. The threat of high levels of unemployment may also place constraints on consumer spending for non-essential items and also on business investment.
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