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 Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

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

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

Industry Profile Excerpts

Industry Overview

The 14,300 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 about 20 workers, and generates $4-5 million annually.

    • The electronics and appliance retail industry consists of 14,300 firms that employ about 440,000 workers and generate about $93 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

                                  Recent Developments

                                  May 14, 2024 - Sales Growth in April
                                  • Electronics and appliance store sales were up 2.1% seasonally adjusted month over month in April 2024, according to the CNBC/NRF Retail Monitor released by the National Retail Federation. The category was down 1.5% unadjusted year over year. Total retail sales, excluding automobiles and gasoline, were down 0.6% unadjusted year over year in April 2024 and up 0.2 % seasonally adjusted month over month. Five out of nine retail categories were higher in April compared to a year ago, led by online sales, health and personal care stores, and building and gardening supply stores. According to NRF President and CEO Matthew Shay, “Consumer spending continues to drive economic growth and retail sales increases, though we see some moderation in spending as consumers continually search for value.” The CNBC/NRF Retail Monitor uses actual, anonymized credit and debit card purchase data compiled by Affinity Solutions.
                                  • A new UBS report in Retail Dive forecasts that 45,000 retail stores may close in upcoming years as online sales gain share. Online retail penetration is expected to rise to 26% from 21%, with retail sales growth of 4% by 2028, as the industry focuses more on fulfillment and distribution centers. If the closures occur, USB said the total number of stores in the US will fall from 958,533 to 913,500. Other factors driving store closures include a tighter lending environment, higher operational costs, and consumers spending more on services than goods. The report stated that sporting goods, clothing, consumer electronics, home furnishings, hobby, book, and music stores have closed the most locations since the first quarter of 2019. Still, retailers can incorporate existing stores as an important piece of their omnichannel capabilities. Per the report, “Our analysis assumes that stores remain an important part of the overall retail ecosystem for retailers and consumers. In the simplest terms, stores serve as hubs of fulfillment and support distribution logistics. This is increasingly more important as consumers are becoming more demanding for convenience or immediate deliveries.”
                                  • According to a recent ConsumerSignals survey by Deloitte, more discretionary categories, including recreation and entertainment, leisure travel, restaurants, and electronics, represented an estimated 22% share of consumer’s wallets in January, up slightly from a year ago. According to the Spending Intentions index, global total spending intentions remained consistent in January compared to December and were significantly higher than a year ago. Spending intentions have gradually returned to their 2021 levels after inflation stunted global spending confidence. The survey also revealed that over 60% of survey respondents reported their finances had either remained the same or improved in the past year, up from 58% a year ago.
                                  • Best Buy is ending sales of DVDs and Blu-rays in 2024, as the company says it is responding to a shift in how consumers watch movies and TV shows, according to Screen Crush. The retailer plans to continue to sell video games in physical formats. Best Buy released a statement to Variety concerning the exit, stating that the change “gives us more space and opportunity to bring customers new and innovative tech for them to explore, discover and enjoy.” While other retailers such as Target, Walmart, and Amazon continue to sell DVDs and Blu-rays, fewer consumers are buying the products. According to trade organization DEG, physical media market revenue in the US fell 28% in the first half of 2023 to $754 million.
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