Challenges In Appliance Retailing
By Steve Smith -- TWICE, 6/7/2004
If you're like me, you probably take a casual road trip every now and again to check out national and local retailers in your area who sell electronics and appliances.
Aside from a road trip, really the best way to check out the effectiveness of any retail operation is to go to a store, shop and buy something. I did just that a couple of weekends ago and my experience came at an appropriate time, since in this issue our annual TWICE Top 100 Major Appliance Retailers list appears.
Topping the list, as usual, is Sears with around $5.6 billion in sales for calendar year 2003, followed by Lowe's with $3.5 billion or so in appliance sales and Home Depot with almost $2.03 billion. Lowe's and Home Depot, despairingly called "the lumber yards" by local independents and buying groups, have come out of nowhere during the past five years. Their 2003 sales together almost equal Sears. (Actually they didn't come out of "nowhere." Over the past five years, the demise of Montgomery Ward and Circuit City's departure from majaps, and the closing of a few regional chains, gave Home Depot and Lowe's an opportunity.)
Anyway, back to my shopping jaunt. My wife and I bought a large major brand name air conditioner from a well-known retailer in the New York metro area last summer. Now we are in the market for two smaller air conditioners for our bedroom and a guestroom. We wanted the same manufacturer, same style and features, only fewer BTUs.
We checked out the Web site of the local retailer we shopped at last year, but they dropped that brand name. We checked out a couple of other local retailers via their Web sites. No dice. I even went to the manufacturer's site to see where this major electronics/appliance brand sells its air conditioners in the New York area. Unbelievably the supplier's site said it did not sell any, which I found out later was a mistake.
On a recent Saturday morning I gave up my AC search to go and get garden supplies at the new Lowe's on 2nd Avenue in Brooklyn. Of course I took a look at the major appliance area, which was well stocked with plenty of brands, plenty of product choices, friendly salespeople and nice displays. To my surprise I saw the AC I was seeking from the brand I wanted, an 8200 BTU model for $148. I bought two of them on the spot, requested next day delivery (for a $70 charge) and ran out of the store like I had stolen them. (P.S. The delivery came the next day, an hour and a half earlier than scheduled.)
What was also interesting is what was on each box the ACs came in. Each one said "Exclusive to Lowe's," which might be a selling point to a consumer.
What's the moral of my story, aside from the fact that manufacturers and retailer must keep their now-vital Web sites up to date? It's not news to anyone in this business, but my experience taught me first-hand the kind of challenges independent and regional retailers are facing in appliances and electronics. When certain major suppliers cut what consumers think are "exclusive deals" with national chains like Lowe's, how do independents compete?
I don't have an answer. What I do know is that nobody ever said that electronics/appliance retailing has ever been easy.
No related content found.
Featured Company
-
Brightpoint
BrightPoint is a global leader in mobile device lifecycle services. We provide a full suite of end-to-end supply chain and customization solutions to manufacturers, retailers and carriers in the mobile device industry. In a world that is increasingly connected with ever-evolving ..more
VIEW ALL GALLERIES