AVB merchandising chief Chad Evans charts a course for long-term growth.
But dealers should step up their marketing game as sales, and promotions, return
By Alan Wolf, YSN
AVB’s merchandising VP Chad Evans presented a good news/bad news scenario before Convention attendees during Monday’s General Session.
First the bad news, which comes as no surprise and really ain’t all that: Business is down from the unsustainable record-breaking pace of the pandemic period.
And the good news? BrandSource members are still outperforming the greater appliance industry, furniture backlogs continue to fall and long-term housing trends bode well for our home product categories.
On the appliance side, this year’s projected declines of 4% – 6% in manufacturers’ unit shipments year over year are expected to ease to -2% – 4% in 2023, Evans reported, as industry growth returns to its historic mid-single-digit mean.
On the furniture front, sales finally slowed following last year’s frenetic run, but still sit slightly above pre-pandemic levels. What’s more, a 76% increase in shipments year to date is taking a bite out of order backlogs, container prices are down 35% from their peak, and some major vendors are taking price reductions on Asian goods as Mexican imports rose 61%.
Looking ahead to next year, unit shipments of home furnishings are projected to fall by 4.5%, compared to this year’s steeper 8% – 10% declines, Evans showed.
Similarly, following the current turbulence in the real estate market, housing starts are expected to return to a healthy average of 1.5 million units over the next two years which will bring with it further demand for furniture and home appliances.
But to get their fair share of that growth, members will have to put the marketing pedal to metal, Evans warned, as inventory availability is refueling the industry’s promotional fires. “Use the group’s tools to compete, ‘own it’ with your marketing initiatives and rightsize your inventory,” while maintaining a healthy perspective, he said.
BrandSource, a unit of YSN publisher AVB Inc., is a nationwide buying group for independent appliance, furniture, mattress and CE dealers.