China Sourcing Reports: Household & Kitchen Appliances

30 Nov 2011 • by Natalie Aster

China’s household and kitchen appliances industry is optimistic export sales will remain on the upswing in the months ahead. Faced with various challenges, however, many companies expect growth to decelerate from last year.

For one, suppliers are facing the possibility of weaker demand in two major markets, namely the EU and the US, amid the difficult economic climate in those areas.

Customs statistics for the first eight months of 2011 already show a slowdown. Revenue from overseas shipments rose 22 percent YoY to breach the $24 billion mark. While still strong, growth is 11 percentage points lower than the same period last year.

Compounding the sector’s problems is rising costs, which are putting pressure on prices. The appreciation of the yuan also remains a concern, as it contributes to the erosion of margins.

The report “China Sourcing Reports: Household & Kitchen Appliances” by Global Sources covers the major products of China’s household and kitchen appliances industry, namely air treatment, heating and cooling systems, water treatment and heating units, laundry and household cleaning equipment, and beverage makers and dispensers. Food preparation, cooking and cooling appliances are also included.

Key findings:

  1. Prices of China-made household and kitchen appliances will continue on an upward track in the months ahead as suppliers strive to cover higher manufacturing outlay and currency risk. A number of enterprises see price markups of up to 10 percent in the next half year.
  2. To sustain profitability, makers are developing more high-value models. R&D efforts at most companies revolve around energy efficient appliances to match the environmental trend.
  3. Many enterprises are also taking functionality a notch higher by combining various technologies in a single design. Specialized models with several convenient features and multipurpose units are on the rise.
  4. Better aesthetics are also anticipated in upcoming releases. Across all categories, the selection will include more variations in shape and color.
  5. The US and the EU are still considered key export destinations as demand in those markets is expected to remain large despite a slowdown. Most China suppliers, however, are keen on increasing exports to South Africa, Brazil and other emerging economies.
  6. Growth in export sales is forecast to stay at double-digit levels in the next 12 months. In Global Sources survey, more than three-fourths of the respondents are expecting an increase of at least 10 percent.
  7. Several companies are also looking at the domestic market for growth opportunities, with the government’s Delivering Appliances to the Countryside program forecast to boost demand.

Report Details:

China Sourcing Reports: Household & Kitchen Appliances
Published: October 2011
Pages: 96
Price: US$ 350.00

Report Sample Abstract

Supplier profiles: Anhui Garments Imp. & Exp. Co. Ltd

Established in 1979, Anhui Garments generated $300 million in sales last year. Ten percent of revenue came from exports of household and kitchen appliances. A monthly average of 20,000 units was shipped overseas. Deliveries included laundry, household cleaning, cooking and cooling equipment.

North America was the largest market, absorbing 60 percent of exports. Central and South America, Africa, Europe, the Asia-Pacific region and the Middle East were the other destinations.

The company operates factories in Guangdong, Anhui, Shandong and Zhejiang provinces. Total monthly capacity for household and kitchen appliances is 25,000 units.

More information can be found in the report “China Sourcing Reports: Household & Kitchen Appliances” by Global Sources.

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