Next year will be a tough one for the forklift market, according to UK business analysts Plimsoll Publishing.

Plimsoll's senior analyst David Pattison says economic uncertainty in Britain will cause some industry members to "sit tight and do nothing radical" while others will cut costs quickly to survive the storm in 2008.

"The average growth in the forklift sector in 2007 has been 5%, but this growth was by no means universal," he notes.

Pattison says 33% of the companies Plimsoll surveyed saw their sales decline.

However, he explains that sales should not be confused with profit.

"Some smaller firms, with a turnover of GBP3 million (USD6.2 million) or less, lost out on sales but still enjoyed healthy margins."

These companies controlled costs and did well by trading in niche products.

With pressure on sales predicted, Pattison advises companies to cut costs in 2008.

"My advice is to reduce costs as part of a planned long-term strategy rather than doing so in panic mode."

He warns that firms in financial difficulties might be targeted for takeovers.

"Arguably, there has never been a better time to go on the offensive and companies with large cash surpluses will be able to make some dirt-cheap acquisitions in 2008 as others begin to fail.

"Anyone already finding it a struggle is likely to experience even tougher times [in 2008] unless immediate measures are taken to reduce costs and improve margins.

"Those who take steps to streamline their business model or who supply a particular demand can expect to emerge in a relatively healthy position," Pattison says.