Garden product manufacturers bemoan cost rises

The Garden Industry Manufacturers Association (GIMA) says cost increases are set to become more prevalent, which could lead to new product development slowing down.

GIMA members say raw materials have risen more than 13% in the last 12 months, with a 5% increase witnessed  since the beginning of 2017, with exchange rates post-Brexit to blame.

Ahead of the Glee trade show, the trade body says this could have a negative impact on innovation, packaging, product size and colour.

GIMA said: "‘Safe’ products that do little to stimulate shoppers’ interest in the sector as a whole could also become more prevalent if costs continue to keep rising at the same rate."

Freight costs for importing goods into the UK is up 5% increase in the first half of 2017, which adds to a 5.2% increase in the second half of 2016. Landed rates are up 17% increase in the last 12 months.

Within the first half of 2017, labour costs are up 4.5%, added to the 4.40% increase in the second half of 2016 because of increased minimum wage after the introduction of the living wage in April 2016, and because workers from the EU and other countries are looking outside the UK for more lucrative seasonal working locations. GIA said retailers will also be subject to similar cost rises, doubling the increase – something that has to be passed onto the consumer.

GIMA director Vicky Nuttall said: "I appreciate that these numbers look slightly daunting, especially when looking at the long-term picture, but it’s not all doom and gloom. We all exist within a buoyant and growing market.

"Garden centres are continuing to grab market share through ongoing diversification, and our latest research has reflected this. In fact, during the first half of 2017, 63% of respondents reported that they expected some form of improvement, with an additional 20% expecting prospects to greatly improve. 

"Whatsmore, despite the challenges we all face, there is still a marked determination to break through and make the changes that will help safeguard the industry for the future.  I’ve no doubt together we will continue to thrive despite larger price tags."

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