Positive prospects for the electrical wholesale market

According AMA’s latest electrical wholesale research report, prospects for the electrical wholesale market are taking a positive turn, and a lot of it is credited to a growth in online sales.

Despite the uncertainty that came with Brexit in 2016 and a slower output growth in 2018, the research report suggests that the market has undergone a steady period of growth.  In 2017, for instance, the market saw improved growth particularly in the domestic sector.

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

The research report highlights the factors which are negatively affecting market growth to be: 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, however, 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 online trading facilities.

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