Real-estate boom fuels sales of small home appliances | Retail ...

The post-recession real estate boom helped to fuel a thriving retail market for small home appliances, which kept going in 2012 despite a more tepid market.

Sales of kitchen appliances such as blenders, ?healthy? deep-fry systems and single-serve coffee makers have jumped 30% to $598.3-million in the four-year period ending December 2012, according to market research from NPD Group Canada.

It comes as cost-conscious Canadians prepare more food at home, but also seek to fill their new and renovated spaces with a host of kitchen products with new systems and features, according to Armin Begic, account manager at the home division of the Toronto market research firm.

If you are renovating your kitchen, you are going to replace your small appliances

?If people are not building and buying brand new homes, they are renovating,? Mr. Begic said. ?There are many homes under construction right now, and if you are renovating your kitchen, you are going to replace your small appliances.?

Product innovation has also had a significant effect on pushing sales in the kitchen category, a point driven home the most by the sweeping popularity of single-serve coffee systems such as Keurig and Tassimo in Canada in recent years.

Sales of those products grew to $122-million in 2012 from $22-million in 2009. At the same time, sales of traditional drip coffee makers slid to $52-million in 2012 from $59-million in 2009.

Sales of deep fryers, bolstered by new ?air? fry systems, which use hot air to cook the food, have grown to $34.3-million from $22.6-million in 2009.

?The three big factors here are innovation, convenience and health,? said Mr. Begic.

In the case of the new frying systems, he said, ?you may not associate deep fryers with health, but the [air] fryers do not immerse the food in oil to cook it. The technology takes a little bit of oil and swirls the oils around the food so there is far less oil used overall,? to make dishes such as fish and chips.

In the same period, sales of consumer electronics, excluding smartphones and tablets, were down 17%, and Mr. Begic noted, with similar models priced 20% lower than they were a few years ago.
NPD?s director of consumer electronics Mark Haar said that was due in part to factors such as differing buying cycles for products and deflation.

?You had these major changes in innovation seven or eight years ago, and phenomenal growth drives the traditional price down,? Mr. Haar said, as the debut models of digital televisions soon faced mass duplication and stiff competition. ?There is a saturation issue, to some degree.?

?The other thing is consumer confidence levels have not really [recovered] to what they were in 2008. With [bigger ticket purchases] like TVs, you hold off a bit. There is still a bit of a shaky economy, but people are a bit light in their wallets.?

Source: http://business.financialpost.com/2013/04/03/real-estate-boom-fuels-sales-of-small-home-appliances/

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