Horticulture was among the few high-achieving industries for the UK economy last year and aims to grow in 2022, but HTA members warn that an increasing cost base risks undermining the progress made
2021 sales figures were strong despite economic and other challenges
Data from horticulture's leading trade association shows that 2021 was another incredibly strong year for garden center retailers despite the double impact of post-Brexit trade restrictions and the pandemic.
The Horticultural Trades Association's (HTA) latest Market Update report shows that whilst many sectors have seen profits damaged after businesses wrestled with a host of challenges and negative effects, horticultural businesses were one of a handful of success stories for the UK economy in 2021.
Despite a host of Covid restrictions, total garden center sales for the year were up 23 percent from 2020 and up 36 percent from 2019. Within this, garden/gardening sales were up 32 percent in 2020 and up 65 percent in 2019. This is likely due to the increased demand for garden products, with HTA research showing that pandemic gardeners broadly stayed engaged in their new hobby. Garden center catering sales for the year did however decline by 59 percent from 2019 as restrictions on hospitality saw them unable to operate their catering services at full capacity. Still, with nearly 60 percent of people in the UK having had their booster jab as of 3 January 2022, members are hoping that consumers will return to restaurants and cafes in greater numbers in the year ahead.
Consumers faced financial strain and potential health risks
When considered against the backdrop of the increased financial strains faced by consumers last year, these sales figures are impressive. Consumer financial confidence remained relatively low in 2021 though considerably higher than in March 2020 and following the 2008 financial crisis; decreasing by only one point in December 2021 despite the looming threat of record-high inflation, fuel price increases, and general living expenses rising.
In the final month of 2021, Christmas category sales in garden centers were strong, up 33 percent in December 2020 and up 17 percent on 2019. Catering sales for the month of December were up 54 percent from December 2020, when lockdown restricted indoor dining, but down 41 percent from December 2019, pre-pandemic. This is likely because of concern about the spread of the Omicron variant in the lead-up to Christmas.
Fear of increased regulations and restrictions in 2022 could stifle growth plans
Looking at the year ahead, it seems there is a mood of cautious optimism. HTA member research shows that growers and retailers are committed to investing in their businesses (49 percent plan to invest in new infrastructure, buildings, and facilities in 2022), but they remain concerned that extra cost burdens and regulations could stifle this ambition. As our quarterly Member Voice tracking showed, the positive business outlook steadily declined quarter on quarter throughout 2021. With post-Brexit costs associated with importing plants increasing by between £25m and £50m last year, the price of shipping containers doubling over 2021, along with higher inflation, increasing wage costs, and labor shortages coming through in 2022 it is likely to be a challenging year of business pressures. Around one in twenty roles at garden centers and ornamental grower firms are unfilled, meaning recruitment and retention will be a key factor in 2022 for how well members grow their businesses.
David Denny, Futures and Sustainability Manager at the HTA, said: “Last year was a strong one for horticulture. Participation in gardening that exploded in 2020 during the lockdown was, mostly, sustained through 2021. Looking to 2022, continuing higher costs for importing and exporting plants is a specific government-initiated burden on our industry, as well similar headwinds to those facing the wider UK economy, be that inflation of costs and competition for labor and skills. Despite this, our member businesses continue to lead the UK’s green recovery and are investing in future growth."
In June 2020, HTA’s consumer tracker survey revealed that 64% of British adults said they used their gardens for growing plants, trees or flowers; an increase from 57% in June 2019. Taking the British population size of 52.6 million adults and the proportion of these people with access to a garden or outdoor space (83%), this 6.71% change was equivalent to an extra 2.9 million people gardening. When the survey was repeated in August 2021, the proportion of British adults growing plants, trees or flowers fell to 62%, equivalent to approximately 670,000 fewer people gardening than in 2020; though still 2.3 million more than 2019.
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Horticultural Trades Association