Home > Latest News > Record Growth Q1 2015 For CE + Appliances Claims GFK

Record Growth Q1 2015 For CE + Appliances Claims GFK

Record Growth Q1 2015 For CE + Appliances Claims GFK

In a report sent to vendors last week the European research group said that the growth was driven by strong performances in telecommunications and small appliances a category that has given JB Hi Fi a major lift in the last quarter. 

Retailers are set to benefit this quarter by the recent Federal Government small business stimulus which will deliver tax breaks up to $20,000 to businesses with under $2M in revenue.  

The latest ASX data shows that JB Hi Fi and Harvey Norman along with Officeworks share values are up while Dick Smith who are struggling to deliver profits due to rampant discounting are down with analysts tipping that JB Hi Fi, Officeworks and Harvey Norman will get the majority share of the stimulus when it comes to appliance and consumer electronics expenditure.   

As of Friday JB Hi Fi was up 1.90% to $21.46, Harvey Norman up 0.8% to $4.60 while Dick Smith Shares were down 1.33% to $2.23.

GFK said that the first quarter benefited from the first of two first interest rate cuts delivered by the reserve bank. 

The outstanding categories in the first quarter were telecommunications and wearable goods. These categories grew by 25% in value.

Exchange rates and new handset launches helped the category which delivered an average price rise of 15% when compared with the same quarter in 2014 GFK said. 

Sales volumes particularly in prepaid smartphones also increased during the period. 

In wearables, broadening ranges, increased distribution and increased marketing activity drove strong demand.

 Health and fitness trackers were the largest wearable category, accounting for 9 of every 10 wearable device sales, with Smart and GPS watches making up the remainder. Overall value sales saw close to a four-fold increase on the same quarter last year.

In the Small Domestic Appliances market it was hand stick vacuum cleaners and blenders that delivered growth of 13%.

Coffee machines sales also grew for the first time in more than two years, driven by demand for manual machines and high-end products.

Within the breakfast appliance sector, toaster and kettles performed well as consumer migrated from plastic to higher-priced metal finishes. 

The Major Appliances market also grew by 11% driven by demand for refrigeration and premium French door side by side refrigerators.

In the washing machine market consumers traded-up to higher-priced frontloading and high-capacity machines. As a result, both refrigerators and washing machines experienced double-digit value growth, similar trends were visible across the full range of white goods products.

One of the weakest categories was the PC, tablet and monitor market. 

After two consecutive quarters of decline, IT recovered in quarter 1, with modest value growth of 0.2%.

Mobile computing recorded its first double-digit growth since 2009, thanks to a huge surge in volumes of lower-priced models. In contrast, tablet sales continued to decline rapidly.

Often accompanying a growth in mobile computing is a buoyant monitors segment as consumers moved to use a new generation of 32″ and 34″ monitors as TV screens for subscription TV services. 

The basket case for the quarter was TV’s as manufacturers discounted out old models for new. 

An overall decline of 1.6% represented a significant recovery for the consumer electronics sector which has witnessed significant decline in prior quarters. 

The continued strong growth of super-large screens, at increasingly attractive prices, was a key factor behind the recovery, and the growing UHD/4K segment grew to more than a quarter of the market’s value GFK said. 
The 1st quarter 2014 was boosted by the digital switch-over, making it a period of weak demand, also contributed to the year-on-year value sales growth.

GFK said that the TV market expected to continue growing, but at slower rate.

The likelihood of continued strong growth in the Telecoms sector, coupled with a federal budget that will strongly support the more traditional categories, points to a relatively positive outlook for the remainder of 2015 GFK concluded.