Global Household Equipment Report

Global Household Equipment Report

What to watch ?

  • Volatility of household consumption and interest rate drives fluctuations in sales​
  • Increasing price pressures to persistently affect margins ​
  • Rising e-commerce activities challenging traditional players​
  • Risk of cannibalization between new product lines due to the convergence of their functionalities ​

Household Equipment id card

Fragmentation
Fragmentation-2 
Internationalization
Internationalisation-3 
Capital Intensity
Capital-intensity-2 
Profitability
Profitability-2 

Sector risk map: Household Equipment

Growth goes on despite deflationary pressures

In 2016, the household equipment sector grew by +4.2%, well below the long-term trend (+8.0% over the last decade). The sector is at the boundary between household investment and consumption, comprising appliances or “white goods” (65%), consumer electronics aka “brown goods” (10%), and furniture (25%). It is highly globalized and sensitive to the economy as a whole. Long-term sales growth has, therefore, remained weak because of price pressures, and the close linkage with the construction sector, in itself still convalescent in many countries.

 

Despite this global structure, a strong dichotomy persists between advanced economies where the sector faces stagnation or is slightly decreasing in value (-1.4% per year since 2005) and emerging markets where it enjoys steady growth (+14.2% over the last 10 years).

 

Growth in advanced economies depends to a large extent on technological innovations and household decisions on equipment renewal.

 

The sector is also linked to the breakdown of households' current spending items between food, clothing, and leisure. The structure of these expenditures, which is specific to each country, is harmonized with the rise in the standard of living of households.

 

 

Key Players

Country

Role

Sector Risk

China #1 Producer
#2 Exporter
Dot-Risk-Medium
UNITED-STATES

#1 Importer
#3 Producer

#5 Exporter

Dot-Risk-Medium
japan

#2 Producer

#7 Importer

Dot-Risk-Medium

Strengths

  • New market opportunities thanks to a growing middle class in emerging markets
  • Highly adaptive to consumer expectations of innovative and interconnected products Structural growth due to population growth
  • Global, high-volume market

Weaknesses

  • High sensitivity to household income and savings rate
  • Extremely competitive sector where low-cost products play a major role
  • Household expenditures allocated to many different services and products
  • Reliant on the cyclical construction market

Household Equipment Subsectors Insights

Semiconductors: A capital intensive activity concentrated in Asia (main actors in Taiwan) and highly dependent on economic growth fluctuations. The market will probably continue to perform well for the next 5 years.

 

Appliances and consumer electronics: Increase in volumes due to first acquisitions and renewal of products.

Global Sector Reports

picto-aeronautics
Aeronautics
picto-agrifood
Agrifood
picto-automotive
Automotive
picto-chemicals
Chemicals
picto-construction
Construction
picto-energy
Energy
picto-household-equipment
Household Equipment
picto-information-communication-technologies
Information & Communication Technologies
picto-machinery
Machinery & Equipment
picto-metal
Metal
picto-paper
Paper
picto-pharmaceuticals
Pharmaceuticals
picto-retail
Retail
picto-textile
Textile
picto-transportation
Transportation
​ ​​