We have seen the impact of higher inflation on consumers over the past year. In particular, we saw rising fuel and mortgage costs in 2023, which meant that households had less to spend. 

How has this affected garden centres? Financial results for the year end of 2023 were generally reported across the industry as down, particularly when compared to the bumper post-lockdown surge in garden expenditure. Fortunes are up to 20% lower in turnover terms compared to pre-Covid-19 levels, when inflation is excluded. Budgets for 2024 are cautious with little growth forecast but with some green shoots on the horizon. 

This spring is set to see energy prices decrease by perhaps 10-15% which should put more money in people’s pockets, with recent surveys suggesting utilities was one of the top categories for reduced spend at present. Likewise commentators agree rate rises are at an end and some drops later in the year should be anticipated. Most garden centres, however, are concentrating not on growing their top line, which should rebound slightly over the year anyway given the wider economic picture, but on cost control, where they can make a significant difference to the bottom line.

The sector faces the same challenges as the rest of the economy – finding staff is difficult and wages offered are increasing to attract applicants, and reflect increased minimum wage requirements, and stock remains expensive.

However, we have been here before – spending at garden centres has continued to increase through every recession since the 1970s – so as we become used to life being a little bit more expensive it remains reasonable to expect customers to continue to shop at garden centres and maintain their profit levels over the longer term, assuming agile management.

That said, now could be a useful time for garden centre operators to stand back and have a look at their businesses. Between 50% and 62% of 30 to 44 year olds own a home.  These millennials are now considered the biggest spending and consuming group in the population.  Finding ways to attract them to garden centres is a route to business longevity. Now could be a good time to check in and see whether some adjustments could keep a centre ahead of the market and satisfy the demands of younger consumers, particularly in stock range, concession choices and appearance.

Millennials’ interests and spending patterns differ from those of the older generations. Novelty and experiences are strong drivers, their food preferences can vary from what is served in a traditional garden centre café, and they are very brand focussed. Garden centres which seek to brand themselves strongly, and offer well-known brands at their centres are likely to attract this market group, as will introducing more experiential offers such as events and theme weekends to supplement the Christmas, Easter and Halloween focus.

The younger generation is also interested in sustainability and the environment and will avoid centres where little effort is on show to reduce waste and pollution. They wish to see renewable energy use, reduced use of pesticides, peat-free growing, local sourcing of products to reduce product miles, serious efforts to reduce waste, and better promotion of what the centre is doing to reduce its carbon footprint. 

Upgrading a centre to make it more modern in appearance and energy efficient, offering dishes from around the world and healthier food options, and having themed open days to entice new visitors could be some ideas to bring younger visitors to gardening. 

Further information

Contact Kay Griffiths or Elinor Cayzer

UK Garden Centre Spotlight – 2023