Electronics and Appliance Stores

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 17,400 electronics and appliances retailers in the US sell electronics, appliances, and related products and services. Major revenue categories include computer products; TVs and other video equipment; household appliances; telephones (including cell phones); audio equipment; and photographic equipment and supplies. Firms may provide or sell warranty, repair, delivery, or installation services. The industry includes national and regional chains and independent operators.

Rapid Changes in Technology

Advances in technology have created an ever-evolving marketplace for consumer electronics.

Competition from Alternative Sources

Electronics and appliance retailers compete with a variety of alternative sources, including warehouse clubs, department stores, home improvement stores, mass merchandisers, manufacturers, and online-only retailers.

Industry size & Structure

The average electronics and appliance store operates out of a single location, employs 24 workers, and generates $4-5 million annually.

    • The electronics and appliance retail industry consists of 17,400 firms that employ about 425,000 workers and generate about $77 billion annually.
    • Household appliance stores account for 24% of industry revenue and 30% of stores. Electronics stores account for 76% of industry revenue and 70% of stores.
    • The industry is concentrated; the top 50 companies account for 72% of industry revenue.
    • The industry includes national and regional chains and independent operators.
    • Large companies include Best Buy and Pirch. Some large firms have international operations.
                                  Industry Forecast
                                  Electronics and Appliance Stores Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Coronavirus Update

                                  May 17, 2022 - Manufacturing Slows in China
                                  • Electronics and appliance stores may have difficulty acquiring sufficient inventory due to supply chain issues that are creating more uncertainty with each new spike in China’s COVID-19 cases. China’s manufacturing output decreased to a 26-month low in April as its zero-tolerance approach to the pandemic slowed factory output. The Caixin China General Manufacturing purchasing managers’ index (PMI) dropped from 48.4 in March 2022 to 46 in April. A reading below 50 suggests output is contracting rather than expanding. In April, new orders and production fell to their lowest levels since the survey began in 2004, and exports declined at the steepest rate in nearly two years. Delivery times grew at the second-fastest rate in the index’s history amid travel restrictions and raw materials shortages.
                                  • Electronics and appliance stores may start to see some easing of the supply constraints in the semiconductor market, according to a recent report by Gartner. Slower growth in the PC, smartphone, and server markets should help bring chip supplies in better balance with demand throughout 2022, but supplies of some products are expected to remain tight. Shortages are projected to stretch into 2023 for semiconductors with wide use in automotive applications, including microcontrollers, power management integrated circuits, and voltage regulators.
                                  • Retail sales for the electronics and appliance store industry increased 1% in value month over month on an adjusted basis in May 2022 but decreased 4.7% in value year over year.
                                  • A significant number of appliance categories are on a 90- to 120-day backorder due to component shortages and social distancing in factories, according to industry veterans. There are severe component shortages for dishwashers and refrigerators and material shortages such as rolled steel. Many customers are deciding that getting a brand name item is much less important than getting an item that is currently in stock. In March 2022, the value of US household appliance manufacturers’ unfilled orders was up 11.9% compared to March 2021, according to the US Census Bureau.
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