Retailers with rent-to-own deals are invading this industry's territory
Melbourne, Australia (PRWEB) November 06, 2012
The past five years have provided the Furniture, Appliance and Equipment Rental industry in Australia with varying conditions as the industry has mixed reactions towards changes in economic conditions. According to IBISWorld industry analyst Jeremy Edwards, “the industry experienced losses in 2009-10 as the onset of the global financial crisis resulted in falling consumer sentiment and therefore significant declines in private capital expenditure”. As the economy began to improve, conditions remained somewhat uncertain and low-income earners (including students in particular) looked to rent furniture, appliances and equipment instead of purchasing. Industry operators have also created new rent-to-buy options for consumers to compete further with the retail sector, providing consumers the option to purchase goods after long-term rentals.
Overall, the Furniture, Appliance and Equipment Rental industry in Australia has continued to perform, growing by a compound annual rate of 1.1% over the five years through 2012-13 to be worth $1.52 billion. The industry is expected to continue growth typical of the past five years as conditions stabilise, with revenue increasing by 1.1% in 2012-13. “Growth in business numbers has been lower than increases in revenue despite solid profit margins, as barriers to entry in this industry are significant,” Edwards adds. The outlook for the industry is positive, yet expectations need to be tempered. The industry is expected to face increased competition from retail outlets as consumer confidence increases and furniture and home equipment prices remain relatively low due to production in low wage countries. Furthermore, industry operators are expected to move towards online operations in order to be competitive with the retail sector and their response to consumer trends.
Industry market share concentration indicates the extent to which major players dominate the industry. This industry has a low level of ownership concentration; the largest player is Thorn Group Limited. The industry comprises many small-scale geographically dispersed firms which operating in narrow regional or niche product markets. The industry includes many non-employing establishments, typically one or two person businesses in which proprietor may function on a full-time or part-time basis. For more information, visit IBISWorld’s Furniture, Appliance and Equipment Rental report in Australia industry page.
Follow IBISWorld on Twitter: http://twitter.com/#!/ibisworldau
IBISWorld industry Report Key Topics
Companies in this industry rent out a variety of household goods and furniture to consumers and corporate clients.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.