KBSA corporate chairman Malcolm Scott has reassured retailers that the KBB industry is still in a healthy state despite new figures showing that uncertainty over Brexit and the general election have begun to stifle economic growth.
“As we move into the second half of the year, we can all breathe a sigh of relief that the big economic meltdown predicted by some after the Brexit vote has not happened,” he said. “But the economic slowdown in growth predicted by many certainly has started. Total UK economic growth fell from 0.7% during Q4 of 2016 to 0.3% during Q1 2017.”
However, Scott said that within the UK kitchen sector, appliance manufacturers were still reporting “quite stable sales of built-in appliances alongside freestanding appliance sales which were significantly down”.
Looking at the furniture sector, according to Scott the Symphony Group has reported double-digit sales growth and in replacement appliance sales, Sirius Buying Group, which represents electrical and KBB retailers, has reported that its members are seeing a “good year”, he said.
New AO chief executive Steve Caunce said that its group revenue was up by 17% in the year to March 2017. However, he revealed that the board continued to be “cautious” over the uncertain economic outlook and anticipated losses of £2.4 million in the current trading period.
Commenting on the kitchen specialist sector, Scott said that members of the KBSA also reported that kitchen sales were still healthy.
Scott argued retailers shouldn’t be concerned about the prospect of another recession and warned them to be wary of talking themselves into greater uncertainty.
“While it is not prudent to ignore any signs that things may be a little tougher for the rest of the year, there seems to be very little evidence that the UK economy is actually heading for another recession,” he explained.
“Getting real growth for our businesses may be a little more difficult for the next six months, but as long as we do not talk ourselves into having unfounded doubts, we should all be able to keep business at existing levels and those of us who concentrate on customer service and who continue to invest in the future can still expect growth.”