Online sales increasingly important in electrical wholesale market

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According to the latest AMA Research report, prospects for the electrical wholesalers market are positive, based on modest forecasts for the construction market – with online sales of electrical products becoming an increasingly important area.

Indications for 2019 are positive and the market is forecast to achieve a solid growth rate during the year.

The market has undergone a period of growth since 2014, supported by a strengthening economy and improved construction output. In 2016, growth slowed as uncertainty about the impact of Brexit constrained construction output. 2017 saw improved growth, particularly in the domestic sector, but 2018 resulted in slower output growth.

Factors supporting the market include sales growth in niche markets, innovation in product development, the development of new, specialist services and non-core products, and new legislation and regulations leading to a requirement for higher specification of products.

Factors negatively affecting market growth include continued public-sector budget constraints, uncertainty over the outcome of the Brexit process, price competition with many products in the mature phase of their life cycle, threat from other distribution channels and longer product life-spans which have affected the replacement market.

Online sales of electrical products are becoming an increasing important area of the electrical wholesale market. The growth in online sales between 2012 and 2017 was around 300%, compared to around 20% for the electrical products market as a whole.

Forecasts indicate that online sales growth will continue to perform strongly and achieve double digit growth each year from 2019 to 2021, when they are predicted to account for over 10% of all electrical product sales having represented just 3% in 2012.

The growth of e-commerce solutions among electrical wholesalers has aided the large nationals in particular, as they move towards adopting multi-channel sales. Most of the large national wholesalers now offer electronic versions of catalogues online and are operating on-line trading facilities.

The information was taken from the Electrical Wholesale Market Report - UK 2019-2023 by AMA Research, which is available to purchase on the website.