The industry will be affected by continued price erosion and volatility in the retail market
Melbourne, Australia (PRWEB) December 07, 2012
Mounting competition and changes to the retail landscape are expected to create a tough trading environment for the Domestic Appliance Retailing industry over the five years through 2012-13. Industry sales over this period are projected to decline by an annualised 2.0% through 2012-13. According to IBISWorld industry analyst Claudia Burgio-Ficca, “trading conditions have been affected by declines in the average selling price of electrical goods and volatility across the retail market”. Industry conditions during this period were also affected by trends in household disposable income, consumer sentiment, interest rates and household formation rates. Industry revenue is forecast to rise by 0.8% to $19.5 billion over 2012-13. Despite solid growth in disposable income and a recovery in the consumer sentiment index, revenue across the domestic appliance industry will be affected by continued price erosion and volatility in the retail market. In the quest for bargains, consumers are expected to continue shopping online for domestic appliances, saving themselves trips to bricks-and-mortar stores. Such tactics will erode the market share of traditional domestic appliance retailers while boosting the volume of sales generated by the online market.
Industry revenue is forecast to rebound over the next five years. Sales will be driven by continued advances in product design and technology. “To this end, key growth areas will include smartphones, e-readers, internet protocol TV (IPTV) and 3-D TVs”, adds Burgio-Ficca. However, revenue will continue to be affected by rising interest rates, contractions in consumer sentiment and competition across the industry.
Despite the mature nature of the domestic appliance market, market share concentration has declined for the Domestic Appliance Retailing industry over the past five years owing to the demise of key player. Concentration has been subject to increasing competition over the past five years. Operators have faced challenging trading conditions due to the growing range of domestic appliances sold by competitors. In addition, growth in demand for latest trend items such as 3-D TVs has increased the range of goods on offer and led to strong price-based competition among operators. Sales and profit margins have also been affected by price deflation across a number of categories. Market share concentration levels during this period have also been affected by the continued rationalisation of players including the demise of WOW Sight and Sound and Retravision and the sale of Dick Smith to a private equity group. The major players are Harvey Norman, Muir Electrical, BSR Australia, and JB Hi-Fi.
For more information, visit IBISWorld’s Domestic Appliance Retailing report in Australia industry page.
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IBISWorld industry Report Key Topics
Operators in this industry retail a broad range of domestic appliances including; televisions, audio and home theatre goods, kitchen laundry and floor-care products, small appliances and communication products. These products are purchased from manufacturers and wholesalers before being resold to consumers via retail stores.
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
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