Our recent report on the 2024 Top 50 Major Appliances Retailers left us a bit philosophical. One could look at the overall decline of -8% in sales for 2023 and see an industry in freefall. Or one could look at the $35.6 billion from the top retailers and be comforted by the healthy level of sales. It is all about perspective. One of my favorite philosophers, who just happened to frequent the same pub as me, used to say “It’s all about how you look at it. All I see is happiness in front of me. That’s why I never turn around.”
But, in early 2024 a bit of turning around and looking at the past is warranted to gain a proper perspective. Yes, sales revenues of major appliances have been down significantly since 2022, but we all knew this was coming. The roaring days of COVID-19 could not last forever. However, that $35.6 billion is 26% greater than 2019 sales in current dollars, and 13% higher in inflation-adjusted dollars. That’s the perspective we need.
Unlike many other categories, prices for major appliances, on average, have been coming down over the past year. From 2019 to 2022, average retail prices for major appliances rose an average of 7% per year. That is a lot of inflation in a short period and in 2023 the market started giving back some of those increases. Our price tracking found an average drop of -5% across the core appliances in 2023, with another -6% projected to happen in 2024. Forecasts are for prices to stabilize in 2025 and 2026 when the market returns to its new normal, which is about where it was trending heading into early 2020.
Barring any craziness before, during, and after November, or from other societal disruptions at home or abroad, our forecast for major appliances is positive in 2025 and 2026.
Another bit of normalcy in the retail world of major appliances will be the churn of retailers coming and going. Almost all the top retailers have been around for a while and will likely be here for the next few years. Sure, there have been some acquisitions and consolidations, along with some bankruptcies, but for all those who leave, there will be others to pick up their sales.
That said, our friends at Lowe’s may not be welcoming us to their next company picnic. Based on intensive analyses of Lowe’s and Home Depot sales at the store level and based on local economic differences in their locations, we conclude that Home Depot inched ahead of Lowe’s in 2023.
From our perspective, change is welcome but only if it’s normal.
About the Author
Bob Tancula is a principal of Senex, a Louisville, Ky.-based industry research and analysis firm founded in 2016 to provide greater clarity into markets, and opportunities for entities involved in product development, mergers and acquisitions, retailing, and product design. Tancula has helped compile the TWICE retail rankings since 2006.
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