Majap Market Turns A Corner In 2012

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NEW YORK – After years of flagging sales and red ink, major appliances turned a corner in 2012 as the housing market showed signs of life, manufacturers raised prices and enforced MAPs, and retailers demonstrated promotional restraint.

Whether the majap business can build on that momentum in the New Year remains to be seen, but before we bid adieu to 2012, here’s a last look back at some of the year’s highlights:

JANUARY: Absent the central majap pavilion of 2011, most of the appliance activity at International CES took place within manufacturers’ booths, where the emphasis was on smart products. Samsung showed a washer that alerts remote users when the laundry is done; LG highlighted kitchen and laundry products that could be remote controlled; and Haier discussed its Smart Life Internet-connected refrigerators, washers and ACs that can be operated and monitored remotely.

FEBRUARY: As Sears reported a $2.4 billion fourthquarter loss, h.h.gregg telegraphed its intention to unseat the company as the nation’s No. 1 majap chain. President/CEO Dennis May told analysts that white goods will become its biggest product category, and that “changes in the competitive landscape have created a significant opportunity for h.h.gregg to play a leadership role in the industry.”

MARCH: Offshore majap makers faced possible doubledigit import duties on bottom-mount refrigerators after a year-long investigation by the U.S. Commerce Department determined that Electrolux, LG, Samsung and GE’s Mexican partner sold the products in America at below-market prices. would later dismiss The charges, first brought by Whirlpool, were later dismissed by the U.S. International Trade Commission (ITC), which decided that the companies had not harmed the domestic majap market.

APRIL: Majap makers continued to shun the Kitchen/Bath Industry Show (K/BIS), the longtime CES of whitegoods introductions. Instead, former exhibitors including Whirlpool, GE and Sears used their permanent facilities in Chicago and New York, and the annual Architectural Digest Home Design Show in Manhattan, to showcase new products during exhibit week.

MAY: Despite a series of manufacturer cost increases and a show of restraint by vendors and dealers during Black Friday, majap sales for the 100 largest retailers were flat last year at $24.2 billion, according to TWICE’s annual Top 100 Major Appliance Retailers Report, released this month.

Elsewhere, the ITC, citing subsidies from South Korea, hit Samsung and Daewoo washers with interim import tariffs.

JUNE: Cost increases, a richer mix of high-margin products and improved operational efficiencies sent second- quarter earnings surging for Whirlpool and Electrolux. Whirlpool was back in the black with profits of $113 million compared with a year-ago loss of $161 million, while net income for Electrolux rose 30 percent to 763 million Swedish kronor.

JULY: A surge in room-air shipments prompted by a blistering July pushed total white-goods factory shipments up 6.3 percent this month, although unit volume was still down 1.2 percent year-to-date.

Meanwhile, The Home Depot added Whirlpool, Electrolux and Frigidaire products to its mix and expanded its majap departments in select stores, while the Commerce Department imposed a 12.2 percent dumping margin on LG washers, pending an ITC ruling in January.

AUGUST: Majap revenue is beginning to percolate, the major buying organizations reported at their fall shows this month. Nationwide Marketing Group pointed to a 12-percent delta between unit and dollar volume thanks to vendor price hikes, while BrandSource said its white-goods business is up this year, and will be further aided by the recent additions of the LG and Samsung lines.

SEPTEMBER: As the industry gears up for the holiday selling season, GE introduces slate, a warm metallic gray finish, as the heir apparent to stainless steel, and awardwinning A/V specialty chain Starpower adds major appliances to its sales mix.

OCTOBER: Whirlpool and LG agreed to settle a trio of longstanding patent infringement suits over the companies’ refrigerator designs. The rivals said the agreement concludes years of litigation dating back to 2008.

NOVEMBER: Black Friday weekend was big for major appliances, with some dealers posting high double-digit comps and improved profits. Spurring sales were such eye-catching doorbusters as a $500 Kenmore laundry pair at Kmart, and a 26-cubic-foot sideby- side Frigidaire fridge with door-mounted water and ice dispenser for $800 at Best Buy.

DECEMBER: Changes in majap distribution abounded this month. Most notably, Home Depot picked up Samsung, and Lowe’s welcomed LG some seven years after the brands first entered the home-improvement channel, while Conn’s and Whirlpool parted company as the retailer edited down its assortment.


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