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issue: January 2005 APPLIANCE Magazine

53rd Annual Appliance Industry Forecasts
North America - Housewares' Big Ideas


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by Jill Russell, Associate Editor

While homeowners were busy selecting appliances for their new homes and remodels, the small appliance industry experienced a very uncertain year.

As companies were experiencing growth through acquisitions and mergers, shipments were sliding.

Experiencing many declines throughout the second half of the year, several strong gains in the first half helped level out consistent losses in the latter half of 2004. According to a September report of AHAM’s Portable Appliance Division, cooking and food processing appliances were experiencing a slight decline, showing negative growth for five consecutive months. October shipments were down 19.3 percent over the same period in 2003, and year-to-date shipments were down 5-percent over the same period in 2003.

Air-treatment products also experienced a turbulent year. October shipments were down 32.6 percent over the same period in 2003. Year-to-date results reported that shipments declined 30.5 percent over the same 9-month period in 2003.

Although shipments wavered and dramatically dipped, top small appliance companies reported successful results throughout 2004. Applica Incorporated announced that third-quarter results for 2004 were $187.8 million, an 8.2-percent increase from the same period in 2003. The company also reported that sales for the first 9 months of 2004 were $479.2 million, an increase of 11 percent compared to the same period of 2003.

Throughout the year, Applica reported several organizational changes as it sold its Chinese manufacturing operations. In the company’s fourth-quarter statement, Harry D. Schulman, president and CEO, said the company also renewed its license of the Black & Decker® brand. “We believe that these are profound changes that will have a lasting positive effect on the company,” he said. “We intend to continue to transform Applica to create long-term shareholder value.”

Growth and value is also in the forecast for Jarden. The company has previously acquired Tilia, known for the Foodsaver brand, and more recently, Villaware, specializing in small home appliances. This year, the company acquired American Household, known for its Sunbeam, Mr. Coffee, Oster, and Coleman brands, in a deal worth $875 million.

Despite the lack of strong shipments in 2004, strong company investments paint an optimistic outlook for 2005. Linda Graebner, president and CEO of Tilia, says the electric housewares market is facing a good year in 2005 thanks to the economy. “I think we are seeing an indication of strengthening in the economy, and I think that it will help this business,” Ms. Graebner told APPLIANCE. “I think [with] the continuing trend of people entertaining in their homes and wanting to be in their homes, the industry will certainly see a lot of activity.”

Ms. Graebner also expects the most growth to occur in the low and high ends. “There is always going to be growth at the opening price points for people who want a good value,” she explained. “On the other hand, people want to put the best in the kitchen.”

53rd Annual Appliance Industry Forecast
 
North America
 
Europe
 
Latin America
 
Asia
 
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