Los Angeles, CA (PRWEB) September 13, 2013
The Hardware Stores industry experienced quite a hammering during the recession. Like many retailers of household goods, the industry experienced an increase in demand from the real estate boom and a decline in demand when the housing market weakened. As a result of these contrasting periods, IBISWorld estimates that revenue for the Hardware Stores industry has declined at an annualized rate of 0.4% to $21.9 billion in the five years to 2013.
In addition to the unstable real estate market, hardware stores have had to weather lower consumer spending and increased external competition from the Home Improvement Stores industry (IBISWorld report 44411). According to Industry Analyst Sean Windle, “To adapt to these changes, companies renovated their businesses to attract more customers by diversifying their product lines and changing store floor plans.” In 2013, IBISWorld estimates that revenue will increase 2.0%, thanks to strong growth in per capita disposable income following a drop in 2009 and weak growth in 2010 and 2011. Furthermore, after rising a whopping 15.3% in 2012, the Consumer Confidence Index will continue to increase in 2013. These factors will spur consumers to spend more money at retail stores, including hardware stores.
Over the five years to 2018, industry revenue is projected to grow. “The recovering housing market and increased spending on home improvement projects will help boost industry demand,” says Windle, adding, “Revenue growth and profit will remain low, however, because of increasing competition from home improvement stores and online retailers.”
Despite rising revenue, the number of firms operating in the Hardware Stores industry is expected to fall over the five years to 2018. This decline is largely due to expanding competition from online retailers and big-box home improvement stores such as Lowe's and The Home Depot. The majority of firms in this industry are part of cooperatives, which are business organizations owned and operated by a group of individuals for their mutual benefit. Hardware cooperatives act as wholesalers and exercise large buying power, which translates to cheaper purchases for their members. Cooperatives also issue loans and provide advertising for new members.
For more information, visit IBISWorld’s Hardware Stores in the US industry report page.
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IBISWorld industry Report Key Topics
Companies in the Hardware Stores industry primarily retail a broad range of new home renovation equipment and supplies. Hardware, plumbing, electrical and paint-related tools are the most commonly stocked goods. Consumers purchase most of this industry’s goods for private use, while contractors purchase the difference.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized 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 US 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 Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.