Nine weeks after Britons voted to leave the European Union, Arthur looks at the upward surge in DIY home improvements surging across the United Kingdom.
Despite the fear-mongering before Brexit by then-Chancellor George Osborne, there has not been a catastrophic decrease in the fortunes of the DIY sector. In fact, there has been a resurgence in the long tradition of DIY in the U.K.
Kingfishers, the home improvement retailer behind B&Q and Screwfix released statistics showing £3 billion in sales in the three months up to July 31st. The represents a 3pc rise on a like-for-like basis, rather than the huge drop that was predicted.
Chief Executive Véronique Laury stated that:
“In the U.K., the E.U. referendum result has created uncertainty for the economic outlook, although there has been no clear evidence of an impact on demand so far on our business”
Furthermore, the countries favourite furniture store, DFS, has also seen an increase in sales. DFS recently recorded a 4.5pc rise in like-for-like sales. Research has shown that most sofa sales are done every six to seven years in order to refresh their home, rather than on a need to basis. The increase in sales has got many people thinking about possible explanations.
Contractor vs. DIY
As is often the case when looking at statistics, you need to read between the lines to see the real truth behind them. Kingfisher has recently been undergoing a dramatic change in company policy under Véronique Laury. This includes shutting up to 60 B&Q stores, whilst opening more Screwfix locations. Screwfix is Kingfisher’s franchise aimed at contractors, rather than DIY enthusiasts.
As we drill down into the statistics, we see that B&Q had an increase of 0.5pc like-for-like sales, compared to a 13.3pc rise by Screwfix. Although, as mentioned above, more Screwfix locations with wider ranges are opening so sales were expected to increase, this represents a huge rise compared to B&Q.
Most explanations for this are being put down to Brexit. Since the vote to leave the E.U., house prices have been hit hard. This has made people think twice about selling and making them consider home improvements instead. This would explain the increase in sales in both contractor and DIY home improvement stores. Furthermore, with the weak sterling, some people may be choosing to do home improvement work rather than spend money on an expensive foreign holiday.
However, Arthur would warn against building a ‘brextension’. They are a large, expensive undertaking and are surrounded by legal potholes. They are not something to undertake lightly and you should be sure to know the whole picture before committing.