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UK Market for Dry Cleaning & Laundry Services

DateApr, 2005
Pages0
Price / format€702 / Hard Copy
€702 / Electronic

€702 





Abstract:
This Market Report examines the UK dry cleaning and laundry services industry, which grew by 6.7% between 2000 and 2004 to generate sales of Ј1.37bn. The main services offered are textile rental, dry cleaning and laundry services to the corporate and consumer markets.

Sales to corporate clients continue to take the largest share of the market, accounting for 62.8% of revenues in 2004. Outsourcing is the established practice for many companies that require textile services, and rent linen and work wear from third parties, which then service and maintain it for the client group. Other products include industrial wipers and dust mats for a range of purposes. The shift in the UK economy from a manufacturing to a service base has been beneficial for this sector, as presentational aspects, such as corporate wear, have gained importance and priority within client companies. Health and safety legislation and requirements have also boosted demand from the manufacturing and process sectors.

The retail market has seen little growth since the start of the new millennium. Falling prices in the clothing market have encouraged consumers to replace rather than maintain, make or mend. Changes in fabric technology have also meant a growing range of machine-washable formal wear, which would previously have been reliant on dry cleaning. However, many consumers still prefer to opt for a professional service. The clichй of the cash rich, time poor society has also led to growing demand for home laundering services and door-to-door operations, which has been one developing area of the market.

The dry cleaning, laundry and textile services market remains very fragmented in terms of supply, with a large number of smaller operators being characteristic. The majority of businesses offer services to a relatively small geographical area, particularly in the retail segment. Those dealing with corporate groups require additional investment in equipment and facilities, therefore cast their nets wider. Nonetheless, in 2004, only a handful of companies generated sales of more than Ј5m per annum. Consolidation is an ongoing process in the sector. Johnsons Group PLC has made considerable progress in developing its position with the acquisition of a number of operations, including the former Sketchley chain in 2004.

Service groups are very exposed to the performance of client markets. Positive trends, such as the upturn in the hotel sector, have led to growing sales and the core market is well established. Outsourcing of these types of services is long established and unlikely to be reversed. The consumer market will be affected by changing textile technology that simplifies home care of clothing. However, other services, such as ironing and laundry services for domestic clients, may provide more positive sales trends.

We anticipate that the market will show positive growth over the short to medium term as client sectors continue to perform well.








Table of contents:
Executive Summary

1. Market Definition

Report Coverage

MARKET SECTORS

Market TRends

Home Laundry Market

Table 1: Ownership of Washing Machines and Tumble Driers (% households), 1991-2003

UK Client Sector Performance

Table 2: Turnover in Hotels, Restaurants, and Hospitals and Related Activities (index 2000=100), 2000-2004

Environmental Legislation

Cost Issues

Launderettes Move Upmarket

ECONOMIC TRENDS

Gross Domestic Product

Table 3: UK Gross Domestic Product at Current and Annual Prices (Јm), 1999-2003

Household Disposable Income

Table 4: Household Disposable Income per Capita (Ј), 1999-2003

Unemployment

Table 5: Actual Number of Unemployed Persons (million), 1999-2003

MARKET POSITION

The UK

Table 6: Total UK Consumer Expenditure and Consumer Expenditure on Cleaning, Repair and Hire of Clothing (index 2000=100), 2000-2004

2. Market Size

THE TOTAL MARKET

Table 7: The UK Dry Cleaning and Laundry Services Market by Sector by Value at Current Prices (Јm), 2000-2004

By Market Sector

Corporate Sales

Table 8: The UK Corporate Dry Cleaning and Laundry Services Sector by Value at Current Prices (Јm and %), 2000-2004

Retail Sales

Table 9: The UK Retail Dry Cleaning and Laundry Services Sector by Value at Current Prices (Јm), 2000-2004

Dry Cleaning

Table 10: The UK Retail Dry Cleaning Sector by Value at Current Prices (Јm and %), 2000-2004

Laundry Services

Table 11: The UK Retail Laundry Services Sales by Value at Current Prices (Јm), 2000-2004

3. Industry Background

RECENT HISTORY

Number of Companies

Table 12: Number of VAT-Based Enterprises Engaged in the Washing and Dry Cleaning of Textile and Fur Products (number and index 2000=100), 1994, 1998 and 2000-2004

Table 13: Number of VAT-Based Enterprises Engaged in the Washing and Dry Cleaning of Textile and Fur Products by Turnover Sizeband (number and %), 2004

Employment

Table 14: Employment in the `Other Services' Sector (000), September 2000-2004

Regional Variations in the Marketplace

HOW ROBUST IS THE MARKET?

LEGISLATION

KEY TRADE ASSOCIATIONS

European Textile Services Association

National Association of the Launderette Industry

Textile Services Association

4. Competitor Analysis

THE MARKETPLACE

MARKET LEADERS

The Davis Service Group PLC

Company Structure

Current and Future Developments

Financial Results

Johnson Service Group PLC

Company Structure

Current and Future Developments

Financial Results

OCS Smarts Ltd

Company Structure

Current and Future Developments

Financial Results

PHS Group PLC

Company Structure

Current and Future Developments

Financial Results

Rentokil Initial PLC

Company Structure

Current and Future Developments

Financial Results

OTHER COMPANIES

Bowie-Castlebank

Brooks Service Group PLC

White Knight Laundry Services

Smaller Groups

ALS

Launderette Operators

Outside Suppliers

MARKETING ACTIVITY

Table 15: Main Media Advertising Expenditure by Dry Cleaners and Launderers (Ј000), Years Ending December 2003 and 2004

Exhibitions

5. Strengths, Weaknesses, Opportunities and Threats

STRENGTHS

WEAKNESSES

OPPORTUNITIES

THREATS

6. Buying Behaviour

THE CORPORATE Market

The CONSUMER MARKET

Consumption by Age

Table 16: Average Weekly UK Household Expenditure on Dry Cleaners, Laundry and Dyeing by Age of Head of Household (pence per week), 2002/2003

Consumption by Income

Table 17: Average Weekly UK Household Expenditure on Dry Cleaners, Laundry and Dyeing by Gross Income Decile (pence per week), 2002/2003

7. Current Issues

PERC ALTERNATIVES

GreenEarth

CO2

Polar Dehydration

8. Forecasts

INTRODUCTION

Gross Domestic Product

Table 18: Forecast UK Growth in Gross Domestic Product in Real Terms (%), 2004-2008

Inflation

Table 19: Forecast UK Rate of Inflation (%), 2004-2008

Unemployment

Table 20: Forecast Actual Number of Unemployed Persons (million), 2004-2008

Forecasts 2005 to 2009

Table 21: The Forecast UK Dry Cleaning and Laundry Services Market by Sector by Value at Current Prices (Јm), 2005-2009

FUTURE TRENDS

Demographics

Table 22: Forecast UK Population by Age (000), 2002, 2005 and 2008

Market Segmentation

Competitor Forecasts

9. Company Profiles

The Davis Service Group PLC

Johnson Service Group PLC

Ocs Smarts Ltd

Phs Group PLC

Rentokil Initial PLC

Further Sources

Associations

Publications

General Sources

Government Publications

Other Sources








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