Sluggish demand, sluggish growth, and kitchen appliance companies are hard to “win”
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Changes in the external environment have changed the situation of the kitchen appliance industry. With the slowdown in the growth of the real estate market, the growth dividend of the kitchen appliance industry has also disappeared, gradually moving away from the era of lying and winning. Kitchen appliance companies need to participate in market competition in the limited growth space.
Judging from the performance of the whole year of 2022, the kitchen appliance industry has entered a low period, the overall performance of the kitchen appliance industry has shown the characteristics of weak growth, and the revenue and net profit of many companies are under pressure. By 2023, although the economy shows signs of recovery and the market situation of the kitchen appliance industry has improved compared to 2022, the recovery of real estate is still uncertain. Among them, the demand for the kitchen appliance market in the first quarter has not yet improved significantly. In the downward trend, enterprises still need to “strive for internal strength”.
Real estate is stuck, and the kitchen appliance industry is no longer “lying to win”
In the past 10 years, relying on the dividends of the rapid growth of real estate, the kitchen appliance industry has broken through from a scale of tens of billions to a scale of hundreds of billions, and has been in a golden period of rapid development. The dependence of kitchen appliances on the real estate market has also gradually increased. This has caused kitchen appliance companies to become a major victim when the capital chain of real estate companies is tight. The overall performance of the kitchen appliance industry. More importantly, the decline in real estate has also led to a decline in demand in the kitchen appliance market. The kitchen appliance market has further shrunk, and the era of lying and winning in the kitchen appliance industry has come to an end.
The “First Quarter Report of China’s Household Appliance Industry in 2023” released by the National Household Appliance Industry Information Center shows that the retail sales of kitchen and bathroom appliances were 37.1 billion yuan, a year-on-year decrease of 2.5%. Among them, water heaters, water appliances, range hoods, gas stoves, and disinfection cabinets all fell all the way, continuing the decline in the past few years. Only integrated stoves and dishwashers increased. Data from Aoweiyun.com shows that in the first quarter of 2023, the market size of kitchen heating (smoke, stove, disinfection, washing, embedded, collection, electric heating, combustion heating) was 27 billion yuan, a year-on-year decrease of 2.3%; range hoods, gas stoves Cumulative omni-channel retail sales of integrated stoves, dishwashers, and dishwashers were -4.9%, -10.1%, +0.5%, and +3.1% year-on-year, respectively.
Out of the impact of the three-year epidemic, the overall demand of the kitchen appliance industry will improve in 2023. The most important benefit is that the offline market has returned to normal, and real estate has shown signs of recovery. In 2023, with the adjustment of the epidemic prevention and control policy, the production and life of residents will gradually resume. The negative factors such as production impact and logistics interruption last year are disappearing. This year, the offline passenger flow of kitchen appliances has recovered. However, from a development point of view, the possibility of real estate booming again is unlikely.
According to the China Index data, in April, the transaction area of key 100 cities fell by more than 20% month-on-month, and under a low base, it increased by more than 40% year-on-year. . However, judging from the trend, the downward trend of real estate is still difficult to reverse. In May, real estate once again stepped out of the downward curve. Entering May, the market continued to decline month-on-month, and the pace of business launches also declined significantly. In the first three weeks, the transaction area of new houses in key 50 cities dropped by nearly 20% compared with the weekly average in April. Although real estate has picked up in April, the growth is based on a low base in 2022 and cannot create more increments for the kitchen appliance industry.
Changes and upgrades in the kitchen appliance industry
The kitchen appliance industry has been unable to maintain its growth momentum driven by real estate. The industry needs to rely on internal changes to create new growth. At present, the increase in the kitchen appliance industry comes from the demand for replacement, which requires the kitchen appliance industry to upgrade its structure.
At present, the structure of kitchen electricity consumption has undergone major changes, showing a recovery of high-end and low-end, while the mid-end continues to decline. Changes in the external environment have not restrained high-end consumption, and the demand for high-end consumption has shown a relatively stable situation, and there is still room for growth. The competition in the low-end market is further intensified, which will be the main battlefield for strong companies to conduct price wars.
This will guide companies to upgrade their products to gain more shares in the high-end market. Among them, the trend of systemization and integration is worthy of attention. According to data from GfK Zhongyikang, the scale of integrated kitchen appliances (integrated stoves, integrated cooking centers, integrated dishwashers, and sink dishwashers) will be 5.08 billion yuan in the first quarter of 2023, accounting for 12% of the overall kitchen and bathroom market. . In terms of product categories, since the first quarter, the retail sales of integrated stoves and integrated cooking centers are still on the rise. The integration of kitchen appliances is no longer the exclusive market of “integrated stoves”. The continuous investment in enterprises such as Vantage and Fotile has further opened up the room for the rise of integrated cooking centers.
In recent years, in order to open the second growth curve of integrated kitchen appliances, major brands have begun to focus on the integrated dishwasher track. In terms of function, integrated dishwashers combine dishwashers, sinks, fruit and vegetable washing, water purifiers, garbage The processor and other functions are integrated into one, which greatly “subtracts” the kitchen space.
In the post-epidemic era, as consumers control their spending more rationally, they will be more cautious in choosing brands and products, and companies must strengthen their “internal skills”.
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