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[July 2001]
Profitability is key as competition intensifies UK Ceramic Goods Industry
It's going to be make or break time for 27% of all companies in the UK Ceramic Goods industry over the next 12 months, according to Plimsoll Publishing's latest publication, Profit Predictor Edition 2001: Ceramic Goods.
Analysing 1000 UK companies in the Ceramic Goods industry, this latest analysis has revealed that the industry is set to grow at 4% over the next 12 months. This growth will not be universal as Plimsoll predicts only 32% will actually see sales increase, 41% will see stagnant sales, and 27% are likely to see sales decline.
"As competition intensifies, profitability will be key. Companies must get a better grasp of their costs to improve profits," says Don Turkington, Managing Director of Plimsoll.
Developing a positive approach to improving profitability, Plimsoll has devised 3 Profit Predictors. The aim of these predictors is to anticipate how a company might improve profits over the next 12 months by adopting one of three business plans.
Predictor Plans
1.) Consolidating - 105 companies
The plan proposed is to reduce sales, overheads and staff to improve profitability. All of these companies need to adopt this emergency plan as they are currently loss making. The potential here is huge as these 105 companies could see margins lifted from average losses of 7.8% to margins of 8.5%. The management of these 105 companies are currently exposed and at risk from acquisitive competitors.
2.) Tweak - 161 companies
Although these 161 companies are doing OK, they need a period of stability before considering expanding. Taking a critical look at non-essential costs, margins could improve from 2.7% to an average of 6.2% giving an overall profit increase of 130%.
3.) Expand - 124 companies
These 124 companies are well placed with their only the dilemma is how to exploit a winning position. Many have cash to spend yet to move on they must increase sales to improve profits.
It's difficult for companies such as these to reduce costs as they already keep costs low. The only way forward is to improve profits. Incorporating this plan, margins will move from a current 9.6% to 9%.
Included in the analysis
Plimsoll Publishing's Profit Predictor Edition 2001: Ceramic Goods include is a 12 month future predictor as well as an individual performance analysis of each of the Top 1000 UK companies in the Ceramic Goods industry. The report is priced at £450.00. For further details or to see if your company among those with a prediction plan, ring Jennifer Ovington on 01642 257800.
Key Figures on Predictor Plans:
Consolidate
Number of Companies: 105
Percentage of Market: 27%
Change in Ave. Sales: -10%
Current Ave. Margin: 7.8%
Future Ave. Margin: 8.5%
Change in Profits: 209%
Tweak
Number of Companies: 161
Percentage of Market: 41%
Change in Ave. Sales: 0%
Current Ave. Margin: 2.7%
Future Ave. Margin: 6.2%
Change in Profits: 130%
Expand
Number of Companies: 124
Percentage of Market: 32%
Change in Ave. Sales: 10%
Current Ave. Margin: 9.6%
Future Ave. Margin: 9%
Change in Profits: -6%
Industry
Number of Companies: 390*
Percentage of Market: 100%
Change in Ave. Sales: 4%
Current Ave. Margin: 3%
Future Ave. Margin: 7.4%
Change in Profits: 147%
*Indicated those that file full audited accounts
Details:
Plimsoll Publishing Ltd.
Broadcasting House
The Vanguard Suite
Middlesbrough
TS1 5JA
Tel. 01642 257800
Email: jennifer_plimsoll@dial.pipex.com
ENDS