Sales in the promotional products market in the United Kingdom and Ireland topped pre-COVID levels and reached an all-time record high in 2023, according to just-released research from Sourcing City.

An ASI partner and trade service organization that provides a suite of solutions to the U.K. promo market, Sourcing City reported that industry revenue in the U.K. and Ireland collectively grew 4.2% year over year, rising from £1.134 billion in 2022 to £1.182 billion in 2023. Last year’s tally was approximately $1.5 billion in today’s U.S. dollars.

Sourcing City said the 2023 performance surpassed the previous high of £1.168 billion set in the last pre-pandemic year of 2019. Sourcing City is part of Promo Alliance, an expanded collaborative effort with U.S.-based ASI and Germany-headquartered PSI that provides promotional products companies an array of benefits to better understand international markets and serve intercontinental clients.

Last year, an ASI Research study of the European Union and U.K. promotional products marketplaces determined that the U.K.’s total 2022 revenue was about $2 billion, or roughly £1.6 billion in today’s money. A reason for the difference between the ASI study and the Sourcing City research is that ASI’s reckoning analyzed branded apparel and hard goods.

The Sourcing City research noted that clothing is significantly under-reported in its study because the report doesn’t account for sales of apparel by textile printers, specialist clothing resellers, distributors who buy directly from clothing suppliers, and suppliers that sell direct to end-users.

Overcoming Challenges

Setting a new U.K./Ireland promo industry sales record in in 2023 was no easy feat, says David Long, founder and chairman of Sourcing City.

“Despite the U.K. political uncertainty and turmoil, high interest rates, a cost-of-living crisis in many households, and inflation taking too long to get under control, the U.K. promotional merchandise industry still grew last year,” Long tells ASI Media. “This is a testament to the entrepreneurial lifeblood in the companies throughout our industry.”

U.K. promo leaders note that distributors achieved the record revenue tally even as buyers in certain traditionally strong-for-sales end-markets, like technology, pulled back on spending.

For one thing, society’s continued after-COVID opening, with its return of in-person events, helped keep investment in promo growing.

Nearly
£1.182 billion
The size of promo products market sales in the U.K. and Ireland in 2023.(Sourcing City)

Distributors also engineered the overall gain by remaining nimble, hustling for opportunities and uncovering clients keen to keep marketing even as economic challenges persisted. End-markets where distributors generated consistent sales included professional services, hospitality and events, food and beverage, financial organizations, healthcare, and nonprofit entities.

“The market continues to show strong growth in certain sectors,” says Carey Trevill, CEO of the British Promotional Merchandise Association (BPMA), a professional trade body serving the U.K. promo products industry.

Trevill continues: “After a rocky ride with tech companies who reviewed spending, the industry is keeping a watchful eye on the ebb and flow of marketing budgets, as we can’t rely on previously high-spending sectors remaining the same year on year. This has delivered a resourceful and tenacious approach to securing budgets by promo participants – something that helped fuel business in 2023 and should do so again in 2024.”

Ireland on the Up

The Sourcing City study analyzed the four U.K. countries of England, Scotland, Wales and Northern Ireland, as well as neighbour the Republic of Ireland.

The Republic was slower to shake off the pandemic-era sales doldrums, with 2022 industry revenue still about £11 million below 2019 levels. That changed in 2023 as societal restrictions faded into the rearview and more relative normalcy returned.

Promo sales in Ireland soared 35% on an annual basis last year in 2023, reaching £65.85 million – about £6 million above 2019, according to Sourcing City.

“2023 has seen a very healthy recovery” for Ireland, Long says.

Number of Distributors Grow

In total, there were 2,737 distributors operating in the U.K./Ireland promo market in 2023. That’s up from 2,647 in 2022 and an all-time high, according to Sourcing City’s reckoning.

“Some new companies were founded by experienced staff that had been released by distributors during the COVID pandemic,” Long shares. “There were also companies from vertical markets looking to find additional business, and young entrepreneurs starting out.”

2,737
The number of promo distributors in the U.K./Ireland.(Sourcing City)

Interestingly, distributors that generate more than £1 million in revenue annually make up only 5.6% of the total number of distributorships in the U.K./Ireland. Still, in 2023, they accounted for nearly 60% of market sales.

The remaining 40% or so of market business was generated by distributors doing under £1 million per year. Some 62% of all distributorships in the U.K./Ireland produce less than £250,000 annually. Distributors with revenue between £250,000 and £500,000 represent nearly a quarter of all distributorship firms.

Brand Addition (asi/202515), a Manchester, U.K.-headquartered firm that operates globally, is the market’s largest distributor, according to Sourcing City. Its worldwide 2023 revenues – not just U.K. – are expected to be about £106 million. Counselor Top 40 firms like Geiger (asi/202900) and BDA (asi/137616) are among the U.S.-based distributorships with a strong foothold in the U.K/Ireland.

“It is clear that our industry is made up of a very diverse group of distributor company sizes, and each have their strengths and challenges,” Long says. “The vast majority are professional with a clear understanding of customer service and know how to deliver what the customer needs.”

Suppliers Optimistic Despite Challenges

The number of suppliers operating in the U.K. promo market peaked in 2019 at 2,200, according to Sourcing City.

The figure dropped to 2,060 in 2020 as COVID woes set in. Levels rose the subsequent two years, but 2023 saw a slight decline: There were 2,169 suppliers serving the market in 2023, down a pinch from 2,196 in 2022.

2,169
The number of suppliers serving the U.K. promo market.(Sourcing City)

Similar to their North American counterparts, U.K. suppliers have had no shortage of challenges with which to contend.

Through economic necessity, some suppliers are now operating with fewer staff, with reduced resources, and less stock purchased or manufactured, Long notes. Finding and retaining labor has been an issue, and rising material and transportation/importing costs have been stressors. In some cases, the issues have had consequences for customer service levels and led to suppliers tightening credit terms with distributors.

Still, “in spite of all the challenges suppliers have had to face,” Long says, “the majority are optimistically set for the future.”

Popular Products & Suppliers

Sourcing City’s solutions include a searchable database of products from suppliers throughout the U.K./Ireland promo industry. The company measures “click-through enquiries,” which are generated when a supplier is informed that a Sourcing City distributor has taken full details of an individual product. Each supplier receives an automatic report when a “CT Enquiry” occurs.

The suppliers that received the most CT Enquiries in 2023 were, in order: PF Concept UK Ltd.; Midocean; European Solutions; Impression Europe; Clipper Interall; Your Promo; XD Concepts; Laltex Promo; Preseli Ltd; and Pinpoint Badges.

“Eco-Friendly”
was the most common themed search distributors made in Sourcing City’s product database in 2023.

Meanwhile, the most enquired-for product types/terms were bags, pens, sports drink bottles, travel mugs, jotters, keyrings, mugs, chargers, notepads, and seeds. The five most popular specific, individual products in the Sourcing City database in 2023 were a Fidget Spinner from The Bizz Badge Company, PopSockets from SWAG, a recycled 12-sided trolley coin keyring from CHX Products, an air freshener from Preseli Ltd., and a Sprout Pencil from BIC Graphic.

In Sourcing City’s database in 2023, “eco-friendly” was the most common theme-driven search that distributors made. This was followed by “exhibition giveaways,” “desk gifts,” “drink related,” and “travel related.” The fact that “eco-friendly” was top came as no surprise, says Long.

“There has been an insatiable demand for sustainable products,” Long asserts. “Suppliers have responded, and the majority of new products coming to market have a sustainable claim. The challenge for distributors is being sure that the products are truly eco-friendly and filtering out any that may simply be ‘greenwashing.’”

Long adds that a range eco-verifying certifications are now available, and many suppliers are obtaining these to validate their sustainability assertions. “Distributors,” Long notes, “are going through a steep learning curve to familiarize themselves with this growing information.”

Outlook 2024

Just as in North America, the U.K. promo market must square up to challenges in 2024.

Issues like securing adequate staff, potential stock shortages given supply chain issues, possible product price increases, inflationary pressures, and political turmoil are all in play. And that’s without even mentioning continued headaches from “Brexit,” Britain’s economic decoupling from the European Union, which has led to greater complexity and cost for U.K. industry companies trying to conduct business on the continent and vice versa.

Nonetheless, there’s a spirit of optimism founded not on mere hope, but on business movement that industry leaders are observing in the marketplace.

“In 2024, we will have the Olympic Games, European [soccer] championships, and a likely general election, all of which will boost our industry. There is every reason to expect another year of growth to come.” David Long, Sourcing City

“Our view is the market continues to improve month on month, but it’s tough out there so we need to be on our toes,” Trevill tells ASI Media. “With a myriad of options for businesses to invest their marketing budgets in, reminders of the long-term effectiveness of branded merchandise will help keep those leads coming in and retain regular orders as marketers. BPMA has been extensively promoting to end-users the role of merchandise in the last few months to ensure our industry is front-of-mind and support the growth prospects out there.”

Long sees good things on the horizon.

“In 2024,” he says, “we will have the Olympic Games, European [soccer] championships, and a likely general election, all of which will boost our industry. There is every reason to expect another year of growth to come – subject to uncontrollable world events, of course.”