Independent market analyst Datamonitor’s new report ‘Homeworking’ found that homeworking is a well-established trend across Europe, with the UK having the highest number of workers who spend some or all of their week working at home. The number of homewrokers across Europe is set to increase by 53% by 2005.

With stay-at-home workers spending less on food and toiletries than their office-bound peers, consumer goods manufacturers need to develop new products to fit the homeworking trend.

In 2001, some 26 million people in Europe spent at least part of their typical month working at home, representing almost 16% of the workforce. The number of days worked at home was 2.1 billion, giving homeworking a 6% share of the total number of working days.

The UK has the highest number of homeworkers with 6.5 million – almost a quarter of its entire workforce. Across Europe as a whole there are 14.5 million traditional homeworkers and 11.5 million teleworkers (those who are online from home). Almost half of homeworkers fall into the ‘occasional’ category – i.e. they work from home for, on average, less than one day per week. The rest were regular homeworkers who spent between one and 2.5 days per week at home. The vast majority of homeworkers are in non-manual work, have higher levels of education and more disposable income than the working population as a whole. Most homeworkers (60%) are male. This proportion increases to 66% for occasional homeworkers and 75% for teleworkers.

Homeworking became an established concept largely during the 1980s. Teleworking is on the rise and will be responsible for driving the overall level of homeworking up. Teleworking will also mean that homeworkers will be different kinds of people – more professionals and managers, compared to the manual workers of the ‘80’s.

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By 2005 the number of homeworkers across Europe will total almost 40 million people. The biggest rises will be seen in the Netherlands (88% growth) and Germany and Italy (70%). In 2005, the UK will still have the largest number of homeworkers (8.3 million). The negative impact on different areas of consumer spending could, in some instances, be significant – unless manufacturers and retailers take action now to change the future course of events.  Cont…
Datamonitor has calculated that, as a result of the increase in homeworking, consumer spending on retail food, foodservice, drinks and personal care products will fall by almost €4bn over the period 2000-05. This is because of the differing propensities of homeworkers to eat, drink and use personal care products.

No need for make-up but time for TV? 

Datamonitor’s focus group work found that, as would be expected, the lack of observation (from managers, peers etc.) allows homeworkers to dispense with unnecessary activities such as shaving and make-up. Independence from office life also allows homeworkers to do other things that would probably not occur in the office. Many do use radio, TV or the Internet at various times during the day, although see it as ‘bad’ behaviour and are hence inclined to under-report it. Consumption of alcohol also becomes a possibility at home.

Homeworkers will make changes to their personal care regime. Whilst they do not alter the number of baths and showers that they take (although they do change the time of day somewhat) they are much less likely to shave or wear a fragrance or make-up. The resulting fall in personal care turnover could be more than €0.3bn. However, consumers’ requirements from those products that they do use will be different – more luxurious, relaxing and perhaps of a generally more premium nature.

Homeworkers are more likely to eat breakfast, lunch and snacks than non-homeworkers and are much more likely to prepare an evening meal at home. Over the next five years European food retailers will see a rise in food turnover of €1.9bn and a fall in drinks turnover of €0.5bn thanks solely to new homeworkers entering the marketplace. However, foodservice operators will see a fall in their business of €4.9bn due to homeworking.

The biggest impact will be on the lunchtime foods market as people switch from foodservice and ready-to-eat food to prepare-your-own products. Consumers will realise significant cost savings from this – Datamonitor’s focus groups demonstrated that they notice and appreciate this fact. Unless these consumers are persuaded to use foodservice outlets where they live or buy innovative new retail products, this value-added will be lost.

The biggest winners will be suppliers of meal components and ingredients – or these products in pre-prepared kit formats. There is a real opportunity to build a premium, value-added business serving this market. Homeworkers would be a good starting point for this, but it would also tap into the increasing interest in good, home-cooked food currently being shown by all types of consumer. 

Average prices per unit are going to drop in the snacking and soft drinks markets as homeworkers increase their consumption of these products but at multipack prices. This will reaffirm their knowledge that it is much cheaper to work from home. It will also mean that homeworkers get more used to buying these products in a planned way, which could have consequences beyond just homeworking days.

Manufacturers should tailor new products for homeworkers 

Gavin Humphries, Datamonitor director of analysis, commented: “Consumer goods companies are missing a trick when it comes to products for the homeworking market. Our consumer research found that homeworkers would actively welcome support that helps them through their working day – be that online, in their locality or delivered via their kitchen or bathroom.

“Homeworkers have unmet needs for products and services that will help them to reduce feelings of isolation, distinguish better between their work and home lives and improve their physical and mental health. Developing tailored products is crucial because there is a very real danger that homeworking will actually mean consumers trading down in many product categories – such as eating up leftovers for lunch rather than buying or making something new. It is not just the homeworker that needs to be catered for; we found that 25% of homeworkers had company, meaning that it is important to consider partners and children in putting together product and service offerings.”