Despite a challenging few years for the homewares and furniture markets, in 2024 there are opportunities for significant growth and one of these is in London. As consumers in the capital are willing to invest in homewares and furniture at a higher and more frequent rate than in other areas, home retailers have an opportunity to capitalise on this lucrative market to boost their sales and brand awareness. London is the largest region by value for both homewares and furniture in the UK and its more affluent shoppers have been able to navigate the cost-of-living crisis better and continue to invest in their homes, with homeware sales rising 1.2% and furniture sales declining just 1.0%, outperforming the UK as a whole.
Those living in London expect to pay the most for all homewares and multiple furniture categories, according to GlobalData’s survey of 12,000 nationally representative UK respondents conducted from November 2023 to January 2024. Beyond expecting to pay more, Londoners also replace items frequently, doing so at an average of 7.7 years after purchase for furniture, faster than any other region and faster than the national average of 9.1 years. For homewares, the average is 5.6 years before replacement, with only consumers in Northern Ireland replacing homewares more often, according to the same survey. This demonstrates London's growth potential compared with the rest of the UK, with retailers able to promote more trend-led products to boost purchase frequency.
Smaller store formats pivotal for traction
Retailers need to adapt to the needs of consumers in London to retain a loyal customer base and succeed in the city. Focusing on and promoting key factors such as high quality, which ranked as the second most important factor when choosing a retailer for London shoppers, and design, which ranked above average in most homewares and furniture sub-categories, will be essential to success. Convenience is also vital, with the store being easy to get to ranking fifth among shopper importance. Smaller store formats will be pivotal for a retailer to gain traction.
Retailers must be measured in their approach to opening new stores as online penetration is forecast to start rising again in 2024, focusing on areas with more affluent consumers and higher footfall. Higher rent prices leave little room for error, so new players will need to make an immediate impact. Dunelm’s smaller store format highlights the reach of London, with the chain's 14,000ft² store in Feltham, West London capturing 430,000 consumers within a 20-minute drive of the store. In comparison, its 30,000ft² store in Weymouth captures just 100,000 consumers within a 20-minute driving distance.
Wilko's remaining vacant stores present opportunities
Wilko’s collapse presented an opportunity for home players to expand their store estates, with players such as B&M, The Range and Poundland having already picked through Wilko’s estate. As a result, discount players such as B&M and Poundland have been able to accelerate their store expansion plans and capture Wilko shoppers. But several Wilko stores in London remain vacant, including its old Kensington High Street and Fulham premises. Consumers in these areas are likely to spend more, offering an opportunity for new players such as Søstrene Grene, which has a limited presence in London and could expand its reach.
The Danish retailer opened a store on Tottenham Court Road, a central area of the city, at the end of 2023, following its launches in Wandsworth and Kingston upon Thames earlier in the year. Central London should be part of the retailer’s ambitious plans to open 100 stores across the UK by 2030, as it continues to build on its momentum. Wilko’s remaining vacant stores also present an opportunity for discounters such as B&M and Home Bargains to expand their London portfolios, with a rare chance to upgrade their offer and attract shoppers outside of their core consumers with more upmarket and accessible stores.
