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Plant retailers could benefit as garden centres expand home and leisure offer

Industry figures suggest plant retailers have an opportunity to eat into the plant sales business of garden centres that have moved well beyond a core gardening offer, with some rebranding themselves as "home" or "leisure" businesses.

The debate was reignited by comments reported last week from Guy Hands, chairman of Wyevale owner Terra Firma, who told a newspaper the private equity firm Terra Firma "tends to go for businesses where there's a strong transformational element to them. Something like The Garden Centre Group (Wyevale) is a good example of that, where we've moved it from being plant and horticultural-based to making it more like a leisure company."

Hands added: "We're two years into it. Earnings have doubled and the management team believes they can double earnings again over the next three or four years, so the business is doing very well."

Growers and retail experts said the shift away from gardening by a growing number of garden centres is a "concern". Some garden retailers said plants are now just a fraction of business.

Guy Topping of Barton Grange said 80 per cent of his business is non-gardening, while Van Hage said 15 per cent of business is outdoor plant sales. Meanwhile, several garden centres have changed their names to include "home" in the title.

Squire's managing director Dennis Espley said gardening has become a smaller part of the overall business of garden centres and has "plateaued" after two bad-weather seasons and with people having reduced disposable income.

"Some stores are getting very, very big with a wide range of products - kitchen, homeware, gift and clothing - and have become by default more 'home'," he added. But having a good home and a good plant offer are not mutually exclusive.

Espley pointed out that to be called a home centre, garden centres need to be good or customers will be disappointed. He said Dunelm, John Lewis, Homebase, The Range and Next offer competition in homeware, adding: "Whatever you do, look after your gardening offer. It will stand you in good stead."

Garden Centre Association (GCA) chief executive Iain Wylie said: "A lot of centres are moving their businesses onto a wider spectrum than just gardening. Most centres are diverse businesses, and Wyevale is no exception. If their plant business diminishes in absolute terms then there will be opportunities for others to pick up on. If you take your eye off the gardening ball, you take a risk."

He added that bad weather over the past four years meant that gardening sales have not grown though supermarkets and sales have moved online.

GCA figures show outdoor plant sales are six per cent up in 2014 so far, with members up seven per cent on average year-to-date. Plant sales were 15 per cent up in September. Squire's is about eight per cent up in gardening and eight per cent overall in 2014.

Stan Green, managing director at plant wholesaler Growforth, said: "If plants diminish their importance in a business it is a concern, but we are looking at different platforms and where people sell plants."

He said the issue for growers is to anticipate where customers will buy plants - Waitrose, Next, online or at retail nurseries "where people looking for a genuine plant feel rather than walking through concessions and finding plants at the back".

Selling plants could be a risk but give the best financial rewards if done well, he added. "It was "difficult for (Wyevale) to handle compared to selling leisure products and services." Other platforms will fill the gap, said Green, and he wished them luck in fighting for the leisure pound.

Planner Malcolm Scott told the Chartered Institute of Horticulture conference that the £5bn gardening market is "static essentially and has been so for some years".

He added: "There are probably too many garden centres" and the only future they have got is extending into home and other markets, on the back of public demand. Scott also said no one can "run a publicly quoted company on the back of plant sales".

Staff changes - Wyevale's garden business

Wyevale Garden Centres has appointed Caroline Linger as head of garden. She was previously at The Co-operative Pharmacy and has worked at Argos, Dunelm and Halfords, and was Frosts Garden Centres sales director from 2005 to 2009.

Wyevale is looking for a new head of home and head of horticulture after recent departures. Its new human resources head is Lisa Cherry, formerly of WHSmith.

The most recent purchase for the 141-centre chain is Moreton Park Garden Centre, with two more expected in autumn.

Source : Matthew Appleby - Horticulture Week

19 October 2014

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