blog: news + information from “the home authority”

Housewares Exports Grow in 2013

April 16th, 2014

Report and analysis by: Laura Spingola, Trade Resources Ltd.

2013 was a positive year for housewares exports as they grew 3.9% to nearly $4.3 billion. This is a record high! Almost all export markets expanded, though the pace was more moderate than that of the previous four years.

Houseware exports have now climbed 12.8% over the past two years. This is a testament to the commitment and tenacious effort of U.S. exporters and the recognition of U.S. housewares as well priced, quality goods by buyers abroad.

In 2013 all geographic regions increased purchases of U.S. housewares except South America. The largest market, Canada, showed a solid 5.2% advance to $2 billion. Australia/NZ and Eastern Europe demonstrated sharp rises with Australia/NZ + 16.8% to $121 million and Eastern Europe + 17.4% to $55 million. Two markets that grew at a reduced rate were Mexico + 4.5% to $432 million, and Middle East + 2.3% to $150 million. Europe continued to be a large steady customer + 2.1% to $538 million. Markets that flattened, yet still turned in a positive performance were Asia/Far East + 1.7% to $458 million, Central America + 0.9% to $235 million, and Africa + 0.1% to $54 million. As previously mentioned, South America dipped 3.3% to $221 million in 2013.

Table 1

*2013 preliminary year end data

Source of Data: U.S. Dept. of Commerce, Bureau of the Census

WTA ® GTIS

The export performance by product category was also positive except for a small decrease in tabletop in 2013.

Household electrics, the largest dollar volume category, soared 8.7% to $1.6 billion. Bakeware rose 3.2% to nearly $138 million, space organizers added + 2.1% to $952 million, personal care increased + 1.4% to $732 million, and cookware grew + 1.3% to $265 million. Tabletop was off 0.6% to $599 million.

Table 2

The table below shows the percentage change by category for both the one and two-year time periods.

 

Screen Shot 2014-04-15 at 5.27.57 PM

In recent years there has been a proliferation of new global buyers and new markets that demonstrate their desires for U.S. housewares across all product categories. Producers paid attention to these trends and took the time to invest, innovate and put forth creative product lines to attract and satisfy any taste, generation, social and economic strata, living environment and preferred channel of distribution. This is a very exciting time for housewares’ suppliers and consumers.

Future postings will give more details about the top country markets and what’s selling in each. Good selling!

Report and analysis by: Laura Spingola, Trade Resources Ltd., Chicago, IL

+1.312.939.5030 / LSpingola@TradeResources.com

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Retail News from Around the World: 4/9/2014

April 10th, 2014

Walmart India

Planning a long run in India, Wal-Mart to open 50 wholesale stores in next 4-5 years, to enter ecommerce, strengthen compliance procedures:
“Wal-Mart is committed to India and we are excited about our growth plans and we will continue to focus on the cash-and-carry format as we are very happy with the way it has shaped up in the last few years,” Walmart Asia President and CEO Scott Price said in a statement.

Source: Business Standard

Walmart Asia

After issues in the past with Asian expansion, Walmart is taking a slow and careful approach, with expansion plans primarily aimed only at its three current regional markets – China, Japan, and India, which account for over 60% of Asia’s population. 

In 2006, Walmart exited South Korea, selling its 16 stores there to a local rival. While in India last year, the company terminated a six-year joint venture with Indian conglomerate Bharti Enterprises, giving up a plan to open retail outlets in the country amid uncertainty over the regulation of foreign retailers. Indian operations are currently small, with the company operating around 20 Cash and Carry wholesale outlets.

China has also proved to be a challenging market for the company, with comparable store sales last year growing only 0.7%. Still, the company plans to open 110 stores there over the next three years. Walmart is also looking for “bolt-on” acquisitions of local operators, particularly in the country’s tier-three and tier-four cities, where there has been regional development of big boxes – 6 to 8 store chains.

However, analysts say Walmart’s focus on “everyday low prices” hasn’t translated well in China, where consumers often value product safety and authenticity over low price. However, low prices may play much better in its around 440 stores in Japan after the recent increase of the consumption tax to 8% from 5%.

Source: RNG www.retailnetgroup.com

Asda – Walmart UK

Walmart’s UK banner Asda will expand into the south and southeast of the UK, where it currently has few stores,

Asda is looking to open 40 superstores, 100 supermarkets, 150 gas stations and 1,000 click-and-collect points. Asda will able to leverage its learnings from its recent launch of click and collect in six London Underground locations. Two-thirds will be in the southeast, London, Cornwall and Devon, a spokesman said. These new stores will create up to 12,000 jobs over the next five years.

CEO Dave McMillon said that this move comes as a result of “a seismic shift in the structure of the retail market.” The spokesperson also said they will not be moving into the convenience store sector like many of its competitors and that the stores in the north would not be closing as part of the southward expansion

Source: RNG www.retailnetgroup.com

Top 25 Asian Retailers by Stores Added

RNG presents the top 25 Asian retailers by stores added 2009-13. Small-format stores dominate the rankings – 9 of the top 25 are convenience formats, while 7 more are QSR operators.

For the listing, click here.

Source: RNG www.retailnetgroup.com

Ulmart, Russia’s Largest Ecommerce Merchant

Despite Russia’s current STEIP landscape (slowing economic growth, low consumer confidence, and political instability), ecommerce retailers continue to post double digit growth. Ulmart, Russia’s largest consumer electronics retailer, recently became the first Russican ecommerce retailer to exceed $1 billion USD in sales. Ulmart takes a unique approach to ecommerce, and prides itself on a carefully designed logistics and delivery network. Understanding Ulmart is key to understanding the future of ecommerce in Russia and other Rapidly Emerging marketsas the hybrid online-offline model is far more compatible to the consumers in these markets.

Source: Planet Retail www.planetretail.net

Costco Expands into Eastern Europe

Costco expects to open its first stores in Spain and France this spring as the company looks to ramp up its European presence.  Costco already has 25 units located in the United Kingdom and hopes to further expand its reach in Europe with its first store outside of the UK coming in Seville, Spain this spring.

Costco will launch its Spanish warehouse by the spring of 2014 while it hopes to establish its first French store by 2015.  The company saw an 8% increase in international sales in January while its domestic sales grew by 5%; thus, Costco sees central Europe as an opportunistic location to further its international expansion.

Source: RNG www.retailnetgroup.com

South Africa Retail Data

Statistics South Africa released retail sales data for the market in Dec 2013, indicating a 3.5% YoY increase in retail sales. Growth was driven by apparel, DIY, and mass merchandise retailers. Household furniture and appliance retailers experienced negative growth.

The new data is encouraging for the market. Retail sales in South Africa have rapidly increased since October 2009. Analyst expected 2.7% Dec 2013 YoY and the actual count exceeds analyst expectations by 0.8%. The last month of the year tends to record higher retail sales than other months, due to the holiday season, which causes this period to be especially important when tracking retail growth.

Source: RNG www.retailnetgroup.com

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Australia Home & Housewares Market Overview: Insight to Consumer Buying

April 10th, 2014

IBC Members have access to the Australian Home & Housewares Market Report prepared in September 2013, highlighting specifics makeup of the market in Australia as well as demographics influencing consumer purchasing.  In addition to the many Australian retailers described within the Australian Home & Housewares Market Report, members are encouraged to review the collection the Key Retailer and Key Distributor Reports focusing on the Australian market, found in the IBC Members Only section.  Details found in these reports are integral to understanding the composition of the Australian market for exporters aiming to expand within the market or enter the market for the first time. 

The Australian Home & Housewares Market Report can be accessed here.

Key Retailer & Distributor Reports can be accessed here and here. 

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Helpful Tips for Domestic Licensing

April 10th, 2014

American companies have been successfully manufacturing high quality OEM products in China for decades. Many of the goods produced at their Chinese partner factories are immediately exported back to America or other international markets for outside consumption. With China’s ever-growing middle class and government policies aimed specifically at increasing domestic consumption, it is a great time for American companies to capitalize on the opportunity to expand into the Chinese market. This blog post is meant to provide some useful tips to help companies transition from an export-only relationship with its partner factory in China to one that allows for domestic consumption as well.

In most cases, the facilities contracted to manufacture American products in China are licensed only to export these goods (or send them to a bonded warehouse in China that acts in the same vein) and not to distribute them for domestic consumption. Their reasoning for not having the domestic license or at least telling American companies they do not have the appropriate license, most likely comes down to high export subsidies provided to the factories by the Chinese government.

For instance, the export subsidy on some types of furniture can be 15% or more of its cost. This subsidy is quite substantial and is enough of a motivator for many factories to specialize only in the production of goods for the export market.

While applying for a domestic sales license is not overly complicated, only a legally registered entity in China can apply for one.

Companies currently without a legal entity in China have a few options if they want to sell in the domestic market, which are as follows:

  1. Find a local agent in China who has the domestic license and authorize them to sell your goods. One issue with this option, the American company does not avoid paying the import taxes that will be charged once its goods are collected from the bonded warehouse as these items will still be considered imported goods even though they technically never left China. The other issue is that in authorizing this third party, the company will essentially be giving legal control over its brand and the way it is represented, distributed, and priced in China to a third party.
  2. A company’s second option is to hire a third party to renegotiate a mutually beneficial price with the factory to make it worth its while to produce the goods for the domestic market. After a new price is determined, the factory or an agent you have authorized can apply for a domestic license and sell your company’s goods in China. As in the first option, this relationship will not provide the American entity control over how its products are distributed or represented domestically.
  3. Another option that will provide the American company the most control over its operations in China, would be to set up its own legal entity, otherwise referred to as a Wholly Owned Foreign Enterprise (WOFE). Given the American company is interested in selling its products in China for the long term, setting up a WOFE will allow it to enter into contracts and apply for any and all domestic and export licenses on its own behalf, ultimately remaining in control of its brand, distribution, and business dealings within China. If the company wants to minimize its investment, it can register a WOFE and still subcontract its manufacturing and distribution, while still maintaining control of its operations. Additionally, companies with a WOFE are in prime position to penetrate the Chinese market. In the absence of import/export duties, companies can competitively price their products for the market and continue to bank on their international brand awareness. Regardless of where the goods are actually produced, Chinese consumers innately trust international brands to be of higher quality, and that quality makes them worthy of a higher price.

The above information was provided by US-Pacific Rim International, Inc. (http://www.us-pacific-rim.com), a Maryland corporation providing market entry consulting services for the China market.

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Discover Design: A Judge’s View of 2014 – Meet Terri Winter

April 7th, 2014

by Vicki Matranga, Design Programs Coordinator

Retailers and media looking for trend-setting, high-design products at the 2014 International Home + Housewares Show headed for Discover Design in South Building. The premier design destination at the Show, Discover Design hosted more than 100 exhibitors that presented distinctive products in the Tabletop, Gift and Home Décor categories. The Show also introduced 10 emerging companies in Design Debut, a row of 10 mini-exhibitors set between the Discover Design Gallery and its Lounge.

At the Show last month, exhibitors met new buyers and reported successful new business. “The 2014 Show saw an increase in U.S. and international registration and non-U.S. attendance represented the greatest growth. Specialty retailers made up 75% of our 21,000 buyers,” said Perry Reynolds, vice president of global trade development.

The inspiring Discover Design Gallery, accessible to buyers and media, featured products submitted for the gia Global Innovation Awards for Design. Specialty retailers, editors at influential websites and print publications, trendspotters and independent designers served as Discover Design judges. They reviewed exhibitors’ entries to choose six products as finalists, three of which were honored as Global Honorees. They also selected three companies as gia finalists for best product collection; one was named the Global Honoree. The Discover Design gallery catalogue featured the products entered for consideration and displayed in the Gallery.

Australian Discover Design Judge Shares Top3’s Approach

terri_green close up

Before the Show, we got acquainted with some of the industry experts who determined the winners of the Show’s gia product awards. Today we are speaking with Terri Winter, owner of top3 in Australia. She served on the judging panel and shares some of her experiences at the Show.

Terri Winter founded top3, headquartered in Sydney, in 2001. The unique concept presents the top three items in their respective categories, selected according to design criteria, to offer products in kitchen and dining housewares and accessories. Top3 is about editing options, not limiting choice, and focuses on quality, innovation and style. It sources the best-designed products from around Australia and the world, presented in exciting in-store and online experiences. Top3 believes in fostering design, not stealing it, and makes sure that all top3 products are authentic. Now with three stores, two in Sydney and one in Melbourne, top3 boasts more than 40,000 members—its most loyal customers—and has been recognized with design and retail industry awards, including IHA’s gia retail excellence award.

Terri, tell us a bit about yourself. What is the most fun or rewarding part of your job?

The most fun (and the most rewarding) part of my job is the research and the buying. I am very lucky to really not consider a large part of my work as real work. I don’t watch TV really at all – my evening enjoyment is flipping through the latest design and home magazines and cruising the web for new and upcoming products.

What inspires your passion in your work?

I am inspired to see how much innovation and talent there is in the world. It would be fair to think at some point that there will be no new ideas– but for more than a decade now I am delighted and amazed with the new ideas that emerge in product design. Receiving new product samples is like having Christmas every day of the year!

In the past few years, what has changed most in your business?

Over the past few years the biggest change for me has been having other key team members become more responsible for their own roles and letting go of the feeling that I need to do everything. There is often someone else who may even do it better! Obviously more people shop online as well. We have been online since we started in 2001, so our online store is constantly updated and the amount of information people can get there is far greater, with larger images and video. Being online has always been part of our business.

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What do you see as consumers’ biggest concerns regarding housewares products?

Consumers want quality products that do not need to be constantly replaced. They want products that enhance their daily lives, consider the environment in production or materials and products that simply do their job!

What are some of today’s challenges that retailers face in the housewares market?

Once of the biggest challenges these days is ensuring that customers understand the difference between an original quality product and a cheap copy or replica so they avoid disappointment. “Getting the Look” has been pushed by magazines for the past few years, but these products often don’t last and are of poor quality. The Internet offers easy access to a huge amount of images that may LOOK like what you are searching for, but are often misleading or have little information about the quality or authenticity of the product. This makes it harder for consumers to make informed decisions. These cheap imitations devalue the original product and it is important for us to educate customers as to why they should buy the better quality original in the first place. We have heard disappointment from customers who bought cheap junk and then come to us for something that will last. Many are realizing that you get what you pay for!

How many years have you been coming to the International Home + Housewares Show?

My first visit was in 2009.

What do you find exciting and inspirational at our Show?

There are a large number of smaller companies and businesses that show as well as the larger companies—so it is a great cross-mixture. The smaller innovative housewares brands are really important for me.

How does Discover Design enhance the Show experience for buyers?

Discover Design is a great addition because many people do not take design factors into account as much as they should in their buying. Everything, every product is designed to some extent, but true design considers the user and the manufacturing process so you receive a much higher quality product for the price. Design can reduce manufacturing costs and increase value and integrity of a product. Design is not just about the colour and the pattern—design is planned long before the product is in manufacture. Discover Design showcases the products that apply design and shows everybody who may never have thought about the design process what caring about design can achieve. The calibre of the products in Discover Design is very high.

Were you looking for any specific trends and products that fit those trends?

We do tend to be more about classic design and not specifically trend-related. Despite saying that, however, the increased interest in timber and natural materials certainly influences our decisions.

Tell us about how the Discover Design judging process worked.

Since the judges are located around the U.S. and the globe—I am based in Australia—the judging happens online. We read the submitters’ product descriptions and see their images on a password-protected site and then we vote our choices.

What did you find most interesting in the entries?

I am always impressed with simple innovation. Design does not need to jump up and down and be loud to be heard. The great thing about awards like Discover Design’s gia is that they ensure everyone considers design as an integral part of a product. Companies understand that good design makes business sense, and it shows when you see the submissions every year. Design improves our everyday life, and it is a joy to see more and more people discovering the thrill of using a product that works – and lasts due to good design practice.

Did you get a chance to meet with the exhibitors whose products were selected as gia Honorees?

I met many of the exhibitors and we will have several of the winners and the nominees coming on board with our range at top3 by design in the coming months. We have several products from previous years also.

What types of new products caught your eye for your stores?

Can’t divulge that one – but there are quite a few!!

What events at the Show did you especially enjoy?

The Leatrice Eiseman + Tom Mirable session was fantastic.

Did you find time to enjoy Chicago after a long day of business at the Show?

Although we were there only for a few days this time, were lucky enough to dine with some Los Angeles-based friends at the amazing L20 restaurant. The meal was simply incredible—art and food combined. Every dish outdid the one before it and we finished up at 1 in the morning!!! It was fabulous.

Thank you, Terri, for describing how you value quality and offer design choices in your stores. Thank you for serving as a Discover Design judge and for sharing your thoughts about our recent Show. We’ll see you again at our next Show, March 7-10, 2015!

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To learn more about top3 by design, Australia’s design store, please visit www.top3.com.au.

Discover Design Gallery Attracts Buyers and Media

The Gallery displayed more than 200 exhibitors’ products. At the reception Saturday evening March 15th, exhibitors mingled with retailers and media.

2014 DD reception 1

 

 

 

 

 

 

2014 DD reception 2

 

 

 

 

 

 

 

 

 

 

 

Learn more about Discover Design exhibitors and their products by visiting www.housewares.org/discoverdesign

See more about Discover Design exhibitors here:

http://designapplause.com/2014/discover-design-gia-awards-winners-housewares-show-2014/41273/

http://www.core77.com/blog/gallery/core77_photo_gallery_international_home_housewares_show_2014_26698.asp

Read more about Discover Design here:

http://www.housewares.org/press/releases/show/356.aspx

http://www.housewares.org/press/releases/show/349.aspx

http://www.housewares.org/press/releases/show/332.aspx

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