According to market analysts Plimsoll and their new report on conditions in the garden centres industry, smaller companies have not had the same facilities to ride out the recession as well as their larger counterparts.
David Pattison, author of the Plimsoll Analysis - Garden Centres said: "While large companies have relied on their size, brands and better access to cash, smaller companies have been left high and dry".
He added: "We have given 153 small companies a Danger rating. While conditions have improved of late, I fear a high proportion will fail. Whereas large companies can call on banks and parent companies or cut out loss making parts of their operations, smaller companies are increasingly running out of cash."
Pattison also points out how small companies are struggling to maintain their market share and being squeezed out of the market: "There are 148 small companies are selling less than last year. Clearly they have seen demand for their products dip or worse still, a new competitor has emerged. With their finances already stretched, they have little left in their arsenal to fight back.
"There are clearly too many small companies chasing too little market. The inevitable consequence is another round of consolidation with large competitors buying small companies at a discount. Of the 488 companies with assets of less than £3m, we have identified 223 companies as being vulnerable to takeover."
- Readers of Horticulture Week are entitled to a £50 discount of this new special edition of the Plimsoll Industry Analysis - Garden Centres. Call 01642 626400 for further details and quote reference PR/AA34.
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