Home Improvement Chains On The Fast Track

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How did the various distribution channels that encompass TWICE's 2000 Major Appliance Retail Registry shape up last year when measured against each other?

Once again, led by industry leader Sears, the mass-merchant segment headed the pack with 1999 appliance sales of $5.57 billion, representing a modest 7.3 percent increase over category revenue the year prior. The single-digit gain -- well below the top-100 average of 12.7 percent -- correlates with a nearly 23 percent decline in mass-merchant storefronts that carry major appliances. Typifying the pullback is Montgomery Ward, the nation's fifth largest majap chain. Ward carried the category in 39 fewer units last year, attributable in part to a major store remodeling effort.

The discount crowd was followed closely in sales success by the electronics/appliance store sector, which garnered $4.92 billion in majap revenue last year, representing a gain of nearly 15 percent. The double-digit increase comes on the tail of 1998's 10 percent expansion, as aggressive market incursions by Best Buy (No. 4) and Circuit City (holding on at No. 2) helped narrow the gap between channels. All told, the sector saw an 8 percent increase in units carrying major appliances, for a total of 1,663 storefronts.

But in terms of sheer momentum, the home improvement segment continued to post the largest percentage gains for the fourth consecutive year. Led by an increasingly aggressive Lowe's (No. 3), the category saw its share of majap sales rocket nearly 46 percent, as the number of big-box outlets carrying white goods grew 15 percent to 565 stores.

Also posting significant percentage gains was the department store channel, comprised solely of regional chains like Boscov's (No. 67). Although the sector's 40 percent growth in majap revenue far outpaced the top 100 average, its paltry $14 million in white goods sales was the slimmest of all channels, trailed even the $63 million "Other types" distribution potpourri that includes Internet-based sales. -- Alan Wolf

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