Sales rise in 2010 but future still uncertain, says Klondyke executive

Klondyke managing director Bob Hewitt says this year has brought small sales rises but the future is more uncertain economically.

He said plant sales are up on last year but not by a huge percentage considering people lost a lot of plants in the cold winter - "the kickback of increased plant sales didn't happen".

Hewitt said trade had done well despite financial pressures but would be "tough moving forward, with tax rises and talk of unemployment rising".

He added: "Garden centres still have the huge advantage of relatively low customer spend, compared to people selling cars for instance."

Hewitt said VAT rises in January of 2.5 per cent would not have a big effect. Following the Solex show his main worry is rising freight and labour costs causing Chinese stock to increase in price. He said: "Higher prices are expected."

Norfolk Leisure Acamp chief operating officer Debbie Waudby said worker and container shortages in China have yet to be fully resolved. She believed that there are "obviously" going to be price increases for 2011, which she estimates at between 15 and 20 per cent industry-wide.

Waudby also has concerns about the VAT rate potentially going up to 20 per cent. She said: "This is a bit scary. My experience is that garden centres' customers want suppliers to absorb increases and still make their big margins. It has been difficult to work out prices as the dollar has been falling through the floor."

Hewitt said hosepipe bans in the North West, where nine of the group's 25 centres are, will not hit too hard because they come after the main plant-selling season.

LIKE-FOR-LIKE SALES
Year starting 1 October:
- Overall sales up 5 per cent
- Shrubs up 1.5 per cent
- Bedding up 2.4 per cent
- Furniture and barbecues no change
- Catering no change


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