consumer electronics stores in the industry report

8/10/2019 consumer electronics stores in the industry report

1/35

WWW.IBISWORLD.COM Consumer Electronics Stores in the USSeptember 2012 1

IBISWorld Industry Report 44311Consumer ElectronicsStores in the USSeptember 2012 Justin Waterman

2 About this Industry

2 Industry Definition

2 Main Activities

2 Similar Industries

3 Additional Resources

4 Industry at a Glance

5 Industry Performance

5 Executive Summary

5 Key External Drivers

6 Current Performance

9 Industry Outlook

11 Industry Life Cycle

13 Products & Markets

13 Supply Chain

13 Products & Services

15 Demand Determinants

16 Major Markets

17 International Trade

18 Business Locations

20 Competitive Landscape

20 Market Share Concentration

20 Key Success Factors

20 Cost Structure Benchmarks

22 Basis of Competition

23 Barriers to Entry

24 Industry Globalization

25 Major Companies

25 Best Buy Co. Inc.

27 RadioShack Corporation

29 Operating Conditions

29 Capital Intensity

30 Technology & Systems

30 Revenue Volatility

31 Regulation & Policy

32 Industry Assistance

33 Key Statistics

33 Industry Data

33 Annual Change

33 Key Ratios

34 Jargon & Glossary

www.ibisworld.com | 1-800-330-3772 | [email protected]


2/35


The primary activities of this industry are

Retailing new household appliances (e.g. refrigerators, washing machines and ovens)

Retailing new personal appliances (e.g. hair dryers, curling irons and electric razors)

Retailing computers alongside other household and personal appliances

Offering repair services in conjunction with retail operations

44312 Computer Stores in the US

Operators in this industry retail new computer peripherals and prepackaged computer software in additionto office equipment and supplies.

44313 Camera Stores in the US

Operators in this industry sell new cameras and photographic equipment and supplies, often in conjunctionwith repair services and film developing.

45112 Hobby & Toy Stores in the US

Operators in this industry retail new toys, games and hobby and craft supplies (except needlecraft).

45321 Office Supply Stores in the US

Operators in this industry retail new stationery, school supplies and office supplies in conjunction with newoffice equipment, furniture and supplies.

45331 Used Goods Stores in the US

Operators in this industry retail a wide assortment of used goods, including used consumer electronics.

81121 Electronic & Computer Repair Services in the US

Services in this industry include repairing and maintaining consumer electronic equipment, computers andoffice equipment, and other electronic equipment.

Industry Definition

Main Activities

Similar Industries

About this Industry

The major products and services in this industry are

Audio equipment

Computer hardware and software

Home and office equipment

Major appliances

Small electric appliances

TV and video equipment

Other


3/35


About this Industry

81141 Appliance Repair in the US

Services in this industry include repairing and servicing home and garden equipment and householdappliances.

45411a E-Commerce & Online Auctions in the US

Operators in this industry retail consumer electronics via the internet.

45411b Mail Order in the US

Operators in this industry retail consumer electronics via catalogs or mail order forms.

Similar Industriescontinued

For additional information on this industry

www.appliancemagazine.com

ApplianceMagazine.comwww.ce.orgConsumer Electronic Association

www.census.govUS Census Bureau

Additional Resources


4/35


5/35


Key External Drivers Per capita disposable income

Consumer sentiment index

ExecutiveSummary

Industry PerformanceExecutive Summary | Key External Drivers | Current Performance

Industry Outlook | Life Cycle Stage


6/35


Industry Performance

Current

Performance

Key External Driverscontinued

External competition

Number of households

Index

100

60

70

80

90

1804 06 08 10 12 14 16Year

Consumer sentiment index

SOURCE: WWW.IBISWORLD.COM

%c

ha

nge

4

4

2

0

2

1806 08 10 12 14 16Year

Per capita disposable income


7/35



Current Performancecontinued

Electronics versushome appliances

%c

hange

8

12

8

4

0

4

1804 06 08 10 12 14 16Year

Industry revenue



8/35



Electronics versushome appliancescontinued



9/35



External competitioncontinued

Future trends

IndustryOutlook


10/35



Future trendscontinued

Electronics

convergence andsaturated productmarket


11/35


12/35



Industry Life Cycle

The industry is underperforming

Products, markets and technology

This industryis Mature


13/35


14/35


Products & Markets

Products & Servicescontinued

Major appliances

Computer hardware and software

Audio equipment


15/35


Products & Markets

DemandDeterminants

Products & Servicescontinued

Home and office equipment

Small electric appliances


16/35


17/35


Products & Markets

International Trade

Major Marketscontinued

Consumers aged 65 and over


18/35


19/35


Products & Markets

Business Locations

%

30

0

10

20

South

west

West

GreatLakes

Mid-Atlantic

NewEng

land

P

lains

RockyMoun

tains

Southeast

Establishments

Population

Establishments vs. population



20/35


Cost StructureBenchmarks

Profit

Key Success Factors Having a wide and expandingproduct range

Proximity to key markets

Ability to control stock on hand

Experienced work force

Attractive product presentation

Having links with suppliers

Market ShareConcentration

Competitive LandscapeMarket Share Concentration | Key Success Factors | Cost Structure Benchmarks

Basis of Competition | Barriers to Entry | Industry Globalization

Level

Concentration in thisindustry is Medium

IBISWorld identifies250 Key SuccessFactors for abusiness. The mostimportant for thisindustry are:


21/35


Competitive Landscape

Cost StructureBenchmarkscontinued

Purchases

Wages

Sector vs. Industry Costs

Profit

Wages

Purchases

Depreciation

Marketing

Rent & Utilities

Other

Average Costs of

all Industries in

sector (2012)

Industry Costs

(2012)

0

20

40

60

Percentage

ofrevenue

80

100 3.5

7.13.4

3.01.5

72.0

9.52.7

9.93.9 1.6

0.8

70.0

11.1



22/35



Basis of Competition Internal competition

Cost StructureBenchmarkscontinued

Depreciation

Other

Level & Trend

Competition in

this industry isMediumand thetrend is Steady


23/35



Barriers to Entry

Basis of Competitioncontinued


Level & Trend

Barriers to Entryin this industry areMediumand Steady

Barriers to Entry checklist Level

Competition Medium

Concentration Medium

Life Cycle Stage Mature

Capital Intensity Low

Technology Change Low

Regulation & Policy Light

Industry Assistance Low



24/35



IndustryGlobalization

Barriers to Entrycontinued

Level & Trend

Globalization in thisindustry is Lowandthe trend is Steady


25/35


Player Performance

Major CompaniesBest Buy Co. Inc. | RadioShack Corporation | Other Companies

46.5%Other

Best Buy Co. Inc. 47.9%

RadioShack Corporation 5.6%


Major players(Market share)

Best Buy Co. Inc. (domestic segment) financial performance

Year*

Revenue

($ million) (% change)

Operating Income

($ million) (% change)2007-08 33,328 7.4 1,999 5.2

2008-09 35,070 5.2 1,758 -12.1

2009-10 37,138 5.9 2,103 19.6

2010-11 37,070 -0.2 2,054 -2.3

2011-12 37,615 1.5 1,855 -9.7

2012-13** 38,721 2.9 1,786 -3.7

*Year-end February; **EstimateSOURCE: ANNUAL REPORT AND IBISWORLD

Best Buy Co. Inc.Market share: 47.9%


26/35


Major Companies

Player Performancecontinued

Financial performance

Best Buy Co. Inc. financial performance

Year*Revenue

($ million) (% change)Operating Income


2007-08 39,892 11.4 2,185 2.2

2008-09 44,737 12.1 2,014 -7.8

2009-10 49,243 10.1 2,368 17.6

2010-11 49,747 1.0 2,374 0.3

2011-12 50,705 1.9 1,085 -54.3

2012-13** 50,523 -0.4 983 -9.4

*Year-end February; **EstimateSOURCE: ANNUAL REPORT AND IBISWORLD


27/35


Major Companies

Player Performance

Financial performance

RadioShack Corporation financial performance

Year

Revenue


Net Income

($ million) (% change)2007 4,075.4 -11.0 236.8 222.6

2008 4,034.8 -1.0 189.4 -20.0

2009 4,073.6 1.0 205.2 8.3

2010 4,265.8 4.7 206.1 0.4

2011 4,378.0 2.6 72.2 -65.0

2012* 4,523.4 3.3 70.0 -3.0

*EstimateSOURCE: ANNUAL REPORT

RadioShackCorporationMarket share: 5.6%


28/35


Major Companies

Other Companies

Circuit City CompanyExited in 2009

Player Performancecontinued


29/35


30/35


Operating Conditions

Revenue Volatility

Technology& Systems

Capital Intensitycontinued

Level

The level ofTechnologyChange is Low

Level

The level ofVolatility is Medium


31/35


32/35


Operating Conditions

Industry Assistance

Level & Trend

The level ofIndustry Assistanceis Lowand thetrend is Steady


33/35


34/35


Jargon & Glossary

BARRIERS TO ENTRYBarriers to entry can be High,Medium or Low. High means new companies struggle toenter an industry, while Low means it is easy for a firmto enter an industry.

CAPITAL/LABOR INTENSITYAn indicator of how muchcapital is used in production as opposed to labor. Level isstated as High, Medium or Low. High is a ratio of lessthan $3 of wage costs for every $1 of depreciation;Medium is $3 $8 of wage costs to $1 of depreciation;Low is greater than $8 of wage costs for every $1 ofdepreciation.

CONSTANT PRICESThe dollar figures in the KeyStatistics table, including forecasts, are adjusted forinflation using 2011 as the base year. This removes the

impact of changes in the purchasing power of the dollar,leaving only the real growth or decline in industrymetrics. The inflation adjustments in IBISWorldsreports are made using the US Bureau of EconomicAnalysis implicit GDP price deflator.

DOMESTIC DEMANDThe use of goods and serviceswithin the US; the sum of imports and domesticproduction minus exports.

EARNINGS BEFORE INTEREST AND TAX (EBIT)IBISWorld uses EBIT as an indicator of a companysprofitability. It is calculated as revenue minus expenses,excluding tax and interest.

EMPLOYMENTThe number of working proprietors,partners, permanent, part-time, temporary and casualemployees, and managerial and executive employees.

ENTERPRISEA division that is separately managed andkeeps management accounts. The most relevantmeasure of the number of firms in an industry.

ESTABLISHMENTThe smallest type of accounting unitwithin an Enterprise; usually consists of one or morelocations in a state or territory of the country in which itoperates.

EXPORTSThe total sales and transfers of goodsproduced by an industry that are exported.

IMPORTSThe value of goods and services importedwith the amount payable to non-residents.

INDUSTRY CONCENTRATIONIBISWorld basesconcentration on the top four firms. Concentration isidentified as High, Medium or Low. High means the topfour players account for over 70% of revenue; Mediumis 40 70% of revenue; Low is less than 40%.

INDUSTRY REVENUEThe total sales revenue of theindustry, including sales (exclusive of excise and salestax) of goods and services; plus transfers to other firmsof the same business; plus subsidies on production; plusall other operating income from outside the firm (suchas commission income, repair and service income, andrent, leasing and hiring income); plus capital work doneby rental or lease. Receipts from interest royalties,dividends and the sale of fixed tangible assets areexcluded.

INDUSTRY VALUE ADDEDThe market value of goodsand services produced by an industry minus the cost ofgoods and services used in the production process,which leaves the gross product of the industry (alsocalled its Value Added).

INTERNATIONAL TRADEThe level is determined by:Exports/Revenue: Low is 0 5%; Medium is 5 20%;High is over 20%. Imports/Domestic Demand: Low is0 5%; Medium is 5 35%; and High is over 35%.

LIFE CYCLEAll industries go through periods of Growth,Maturity and Decline. An average life cycle lasts 70years. Maturity is the longest stage at 40 years withGrowth and Decline at 15 years each.

NON-EMPLOYING ESTABLISHMENTBusinesses withno paid employment and payroll are known asnon-employing establishments. These are mostly set-upby self employed individuals.

VOLATILITYThe level of volatility is determined by thepercentage change in revenue over the past five years.Volatility levels: Very High is greater than 20%; HighVolatility is between 10% and 20%; ModerateVolatility is between 3% and 10%; and Low Volatilityis less than 3%.

WAGESThe gross total wages and salaries of allemployees of the establishment.

Industry Jargon

IBISWorld Glossary

BIG-BOX STOREA retail store that is differentiated byits sheer size and large range of products, includingelectronics, household goods and other consumerproducts.

BLU-RAYAn optical disc format designed to displayhigh-definition video and store large amounts of data.

BRICK-AND-MORTARA store that has a physicalpresence and location, as opposed to an online retailer.

COMPARABLE-STORE SALESA retail measure used toassess the true performance of retail outlets by takingout the effect of new store openings and only looking atsales growth of existing stores.

POINT OF SALE (POS)A system used at checkout inretail stores using computers and cash registers tocapture transaction data at the time and place of sale.

RADIO FREQUENCY IDENTIFICATION (RFID)Atechnology that tracks products from the time theyleave the assembly line to the time they leave the storeby releasing continuous signals from a chip.

SMARTPHONEA mobile phone that offers advancedPC-like capabilities.

WHITE GOODSLarge electrical goods useddomestically, such as refrigerators and washingmachines, typically white in color.


35/35

Disclaimer

This product has been supplied by IBISWorld Inc. (IBISWorld) solely for use

by its authorized licenses strictly in accordance with their license agreements

with IBISWorld. IBISWorld makes no representation to any other person

with regard to the completeness or accuracy of the data or information

contained herein, and it accepts no responsibility and disclaims all liability

(save for liability which cannot be lawfully disclaimed) for loss or damage

whatsoever suffered or incurred by any other person resulting from the use

of, or reliance upon, the data or information contained herein. Copyright in

this publication is owned by IBISWorld Inc. The publication is sold on the

basis that the purchaser agrees not to copy the material contained within it

for other than the purchasers own purposes. In the event that the purchaser

uses or quotes from the material in this publication in papers, reports, or

opinions prepared for any other person it is agreed that it will be sourced

to: IBISWorld Inc

Identify high growth, emerging & shrinking markets

Arm yourself with the latest industry intelligence

Assess competitive threats from existing & new entrants

Benchmark your performance against the competition

Make speedy market-ready, profit-maximizing decisions

Who is IBISWorld?We are strategists, analysts, researchers, and marketers. We provideanswers to information-hungry, time-poor businesses. Our goal is toprovide real world answers that matter to your business in our 700 USindustry reports. When tough strategic, budget, sales and marketingdecisions need to be made, our suite of Industry and Risk intelligenceproducts give you deeply-researched answers quickly.

IBISWorld MembershipIBISWorld offers tailored membership packages to meet your needs.

www.ibisworld.com | 1800-330-3772 | [email protected]

consumer electronics stores in the industry report

Documents