The tile market: What do retailers need to know?

Why are we talking about it now?

The tile market could be set for a shake-up following the launch of Tile Mountain, a new etailer set up by experienced tile retailer Mo Iqbal.

As revealed by Retail-week.com last week, its offer is based on low prices without compromising on product quality.

Customers are wooed with next-day delivery of free samples - a service its competitors typically charge for.

Iqbal, who worked for Topps Tiles and built Tile Giant before it was sold to Travis Perkins, has launched the venture with former Topps commercial director Jeremy Harris. Nick Ounstead, a former Topps chief executive, has joined as non-executive director.

How big is the UK tile market?

The highly competitive tile market is worth about £600m at present, according to industry sources and a 2012 Mintel report found that more than a third of all consumers have tiles on the floors and walls of their kitchens and bathrooms. However, the category has been through tough times because of the weak housing market.

There is also limited demand for replacement because of the cost of tiles and of installing them. Just one in 10 consumers said they had replaced tiles in the past three years and just one in 20 said they intended to in the near future, according to the report.

Who are the biggest players in the market?

Topps Tiles, which has 322 stores, and DIY retailer B&Q, which has 380 outlets, hold a 25% share of the market each. Travis Perkins, owner of Tile Giant and Wickes, accounts for 15%. The remaining 35% of the market is split between independent operators.

What is the potential for selling tiles online?

Industry sources suggest that the online tiles market is worth about £50m and that is predicted to grow. Online sales are thought to have accounted for about 2% of Topps’ £177.7m sales in 2012.

In the past, concerns about breakages during delivery and the need for shoppers to feel and see products have been viewed as barriers to the growth of ecommerce but services such as free samples are expected to help online gain traction.

According to Iqbal, sample uptake has been rapid - about two to three times ahead of what Tile Mountain had forecast in its first week.

However, Topps Tiles chief executive Matt Williams has previously said he views the internet less as a sales channel and more as a marketing tool.