Abstract
Professional Portable Power Tools are a specialised sector of the overall
portable power tool market. The market for professional portable power tools
is highly competitive, with an estimated value for 2004 of £233m at
manufacturers' prices and estimated at £244m in 2005.
The UK market for Professional Portable Power Tools is defined as power tools
which are designated as such and are understood to be designed and
manufactured to 'professional' or 'trade' standards. Within the context of
this report, 'portable' means that the tool can be carried and operated by one
person.
The UK market for Professional Portable Power Tools is defined as power tools,
which are designated as such and are understood to be designed and
manufactured to 'professional' or 'trade' standards. Within the context of
this report, 'portable' means that the tool can be carried and operated by one
person.
Over the past few years the market has exhibited a relatively low level of
growth which is mainly attributed to variable conditions in the construction
and engineering manufacturing industry, automotive refinishing, etc.
The market experienced relatively stable market conditions between 1998 and
2002, influenced by low levels of inflation, relatively low levels of
construction and RMI at around 4% and a general decline in average prices
across many of the product sectors.
2003 and 2004 saw investment levels in public sector spending rise as well as
a general upturn in the new build and RMI sector. This impacted on the Power
Tools market in 2003 and 2004, stimulating value growth across several of the
product categories.
In terms of supply, whilst the key suppliers remain significant, indications
are that the market has fragmented to some extent through the development of
the own brand or generically branded products, offered by a number of
distributors who have also grown share in the market in recent years.
Key suppliers within the sector include Makita, Bosch and Dewalt, all holding
between 15 and 18% of the total market share. Smaller, but still significant
companies such as Metabo and Ryobi are estimated to have increased market
share by around 3 and 5%, partly due to the slight fragmentation of the market
between 1999 and the beginning of this century, stimulated by the fall in unit
cost due to increased levels of outsourcing from the far east.
Industrial product distributors, such as Screwfix, Machine Mart, Farnell etc,
have grown their share of the distribution channels in recent years, along
with the builders merchants who remain competitive in the sector.
The current threat to the independent or more specialist dealers is from the
DIY multiples, such as B&Q, who are now offering a full range of power tools,
both corded and cordless, which are marketed as professional use tools. These
high quality products, from suppliers such as Dewalt are likely to result in
smaller tradesmen purchasing from this channel, who are able to offer
competitive pricing, rather than the traditional independents.
Future prospects for the sector are mixed, and whilst growth at, or above
inflationary levels is likely in the next 3-4 years, the overall performance
of the market remain highly dependent on the state of the UK construction
industry and contractors output. As such, with signs of a downturn in the UK
economy in late 2005, there are mixed messages from the market about the
potential for growth in the short to medium term.
Leading into 2006, growth is likely to remain above inflationary levels, but
is expected to steadily slow, in line with the performance of the UK economy.
There is expected to be little growth within the domestic RMI sector, with
consumer spending remaining uncertain for the next 3-4 years with expenditure
being dampened by declining house prices and lower levels of consumer
confidence.
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