A new report, commissioned by the Horticultural Development Company (HDC) reveals that displacing a proportion of the imported £324m of live ornamental plants and £598m of cut flowers presents substantial new market opportunities for the UK ornamentals sector.
The report, produced for HDC by David Denny of the Horticultural Trades Association (HTA), quantifies the opportunities for UK ornamentals growers for import substitution and export.
As yet relatively undeveloped by UK ornamental growers, export markets account for only 5% or £50m worth of UK growers’ sales. Looking for new opportunities, the report found four broad ‘market segments’ within Europe, each with varying degrees of potential.
The strongest possibilities came from two of these – firstly the Emerging East – former eastern bloc countries, some of which have joined the EU where ornamentals spend is low but growing rapidly. In most cases this growth is also seeing import growth; and secondly the Northern and Alpine Affluence -mainly Nordic and alpine countries with high living standards and high per capita spend on ornamentals and much detached housing, with larger gardens. Growth is more modest, but still high and often fuelled by import growth.
The remaining markets were categorised as the Squeezed South – potentially less attractive; characterised by low and falling per capita spend on ornamentals and gardens; and the Mature Mainstay – markets where domestic production is often substantial and competition for UK exporters is likely to be fierce.
Project researcher, David Denny said, “Identifying and understanding these markets highlights significant opportunities for UK growers to achieve sales growth by improving competitiveness against overseas producers.”
And it’s not just exports that present UK growers with opportunities. The report also looked into how UK growers could increase their appeal to home markets. Alongside price competitiveness, the major challenge highlighted was improving flexibility of ordering. Encouragingly, UK garden centres rated the quality of UK produced ornamentals as superior to imports, so a key message for UK growers appears to be to build further collaboration with retailers to provide adaptable supply systems to meet demand.
The potential benefits to the UK economy of grasping import substitution opportunities could be substantial – potentially providing a further 1,000 additional full-time general nursery worker jobs.
Bill Parker, Director of HDC said “HDC’s principal role is to fund the delivery of applied research and development that helps the horticulture industry remain efficient, sustainable and competitive. So while market intelligence is not a mainstream activity for us, we will fund one-off specific market intelligence projects where we think a genuine benefit to levy payers can be identified. This project (CPM 001) aimed to provide ornamental growers with the basic tools to continue investigating potential new markets.”
UK growers can download the Overseas Markets Tool Kit from http://www.hdc.org.uk/hdchta-overseas-markets-tool-kit
It provides statistics on the market potential of 30 European countries and contains a help section providing tips on how to use the data to identify possible targets for further research. The full report of the study is also available and contains detailed analysis of the breakdown of UK growers’ sales of different ornamentals crops to different customer types, based on survey data and analysis of published trade and market statistics. The full report CPM 001 can be found on the HDC website at www.hdc.org.uk