A possible no-deal Brexit may be overshadowed by the COVID-19 crisis. AMA Research considers what this means for the UK pet accessories market.
After the fact
While the question of ‘In or Out?’ has finally been settled, and the UK has been operating at the edge of Europe since 1 February 2020, the ‘shake it all about’ phase of trade deal negotiations still has to be settled.
AMA Research have investigated what precisely are the current and future implications for the £1 billion (€1.1 / $1.2 billion) UK pet accessories market.
Stockpiling
While there was some stockpiling of products, particularly pet foods, in the run up to the original March 2019 deadline, subsequent deadlines passed with much lower, if any, stockpiling activity taking place.
The Christmas period was positive, with good growth, particularly for pet toys and clothing. It emphasised the tendency for British owners to treat pets as members of the family, to the extent of buying festive costumes and stockings filled with treats.
The beginning of 2020 has remained positive but with growth levels slightly lower lately, as UK consumers ease back on non-essential spending.
Potential price pressures
The market is relatively resilient, with the humanisation of pets an underpinning factor. There are polar opposites, however, with the niche, higher value brands at one end and the lower value, import dominated sector at the other. While the rise of online shopping for pet accessories has led to significant price transparency, and therefore price pressure within this lower value sector, the outlook under a ‘no-deal’ could see the pressure increase as the UK trades under WTO conditions. This in turn could lead to increased import prices, and suppliers may try to absorb price increases in order to maintain market share.
Buyer behaviour
Although overall consumer spending has been restrained for many products over the last year, the over-compensation of some pet owners has continued to underpin value growth for pet accessories. This manifests in multiple purchases by some owners of products such as feeding bowls and clothing. In addition, the premium ranges of matching outfits for pets and owners is unlikely to be affected by price increases as the ‘must have’ aspect continues to outweigh the cost.
Effects of the pandemic
At the beginning of March, trade deal talks between the UK and EU started in earnest as both sides try to achieve a mutually beneficial conclusion. However, the UK pet accessories market faced further potentially more damaging ‘shake it all about’ ramifications in Q1 2020. The spread of the COVID-19 virus has led to some extreme quarantine procedures and is also affecting manufacturing productivity levels. As the virus has now gone into the pandemic stage, it could have further, more devastating implications for manufacturing and global trade.
The latest articles
Digital boosts revenue of Petz in Q1 2024
The Brazilian pet retailer posted an online gross revenue increase of 16.6% vs. a drop of 6.1% in its physical stores.
Russia’s pet population has risen 11% since 2020
New data reveals that last year, more than half of households in the country owned a pet. GlobalPETS dives into the insights.
The American Kennel Club acquires grooming certification program
The Professional Grooming Credential is a voluntary scheme to validate pet groomers’ knowledge and technical skills.
Weekly newsletter to stay up-to-date
Discover what’s happening in the pet industry. Get the must-read stories and insights in your inbox.