Recovery from low disposable income during the recession led the industry to benefit from pent-up demand
New York, NY (PRWEB) January 19, 2015
The Farm Supply Stores industry has recorded fairly stable growth in the past five years. Retail stores in this industry provide a one-stop shopping destination for a number of much-needed supplies for consumers in rural areas. IBISWorld Economic Analyst Antal Neville says in the updated report “these products include nondiscretionary purchases like pet and animal feed, heating fuel, clothing and footwear, as well as larger items for equipment or property upgrades, such as fencing, lawn and garden power tools, and agricultural machinery replacement parts.”
In the past five years, recovery from low disposable income during the recession led the Farm Supply Stores industry to benefit from pent-up demand, growing considerably in 2011 and 2012. However, as revenue in much of the agricultural sector began to fall toward the end of the past five-year period, income in a number of rural communities began to fall, leaving a number of consumers with fewer available funds to make large capital purchases. As a result, industry revenue increased in the five years to 2015; however, this five-year growth is expected to conclude with a drop in 2015.
In the five years to 2020, the farm economy will, at first, continue its short-term dip, before resuming its long-term growth trend. While this dip will translate into slightly decreased revenue for farm supply stores in the early part of the next five years, overall industry revenue will remain fairly stable. The nondiscretionary products the industry sells to all types of rural consumers prevents year-on-year revenue from swinging too wildly in any given year. IBISWorld forecasts that industry revenue will grow in the five years to 2020. “Consolidation is one trend that is expected to mark the industry in the next five years as much as it has in the past five years,” Neville says in the updated report. Large-scale stores like Tractor Supply, far and away the industry leader, are able to provide customers with a wide variety of products, as well as added-value services like equipment repair. Since industry growth is expected to remain fairly tempered, larger companies are expected to aim their growth strategies at stealing market share away from competitors, taking a larger share of the pie.
For more information, visit IBISWorld’s Farm Supply Stores in the US industry report page.
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IBISWorld industry Report Key Topics
Stores in this industry sell a variety of home improvement, gardening, livestock and crop products. They are consumer-facing rather than farmer-facing and offer a format similar to traditional home improvement stores. Products sold in these outlets range from garden supplies to power tools, animal feed and power generators.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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