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Stationery (Personal & Office) - Market Report 2006
Key Note Publications Ltd, May 2006, Pages: 152
In 2004, the UK stationery market was worth £2.18bn at manufacturers' selling prices (msp) and we estimate that, in 2005, the value of the market decreased by 0.7% to £2.16bn at msp.
This report examines the UK market for personal and office stationery, which covers products for office, home and educational use, but excludes greetings cards and calendars. Stationery includes products made principally from paper and board, as well as other stationery items, such as writing instruments, and office and school supplies made of plastic.
Between 2001 and 2005, the UK economy has continued to show growth above the level of inflation. Unemployment has remained below one million and the size of the workforce has grown by around 3%. This background has been positive for company investment and activity, and has helped to maintain the market for office stationery. The volume of direct mail continued to grow annually between 2001 and 2003 but, in 2004, the volume dropped by 0.4%. In addition, the volume dropped by 5.3% in 2005.
Stationery manufacturers' costs, including the costs of raw materials, wages and transport fuel, have all risen between 2001 and 2005. Particularly important in 2005 was the rise in gas prices, which affected the paper mills and the paper converters that depend on the mills. Manufacturers in most stationery sectors were forced to pass on some increase in costs in 2004 and 2005, but the price rises have been very modest so far. In the writing instruments sector, manufacturers' prices in 2005 remained below their 2001 level. This downward pressure on manufacturers' prices is coming from import competition and from the power of the office products superstores and other large distributors. Customers have become cost-conscious and own-label products have posed a threat to manufacturers' brands.
Although overall import penetration of the stationery market has remained fairly stable, at around 37%, by value between 2002 and 2005, there has been growth in imports of relatively cheap stationery from China. By 2005, China and Hong Kong between them led exports to the UK of albums, notebooks, book covers, boxed stationery assortments, plastic items for schools and offices, pens and pencils, and small metal products, such as paper clips.
Two of the most important corporate changes in 2005 concerned DS Smith PLC, which decided to pull out of stationery manufacturing but continue to strengthen its involvement in the wholesale of stationery and office products. It sold the leading UK manufacturer of paper stationery, John Dickinson Stationery Ltd, to Groupe Hamelin of France, but acquired the leading office products wholesaler in the Benelux region, Timmermans.
2006 is expected to be a difficult year for the stationery market. It is forecast that the market will remain fairly flat in both value and volume terms to 2010, with overall growth of 10.3% at current prices over the next 5 years.
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