Retail Observer

March 2021

The Retail Observer is an industry leading magazine for INDEPENDENT RETAILERS in Major Appliances, Consumer Electronics and Home Furnishings

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RETAILOBSERVER.COM MARCH 2021 46 P erhaps the biggest competitive advantage a dealer can have over his or her rivals these days – even more than price – is availability. So far during the pandemic, member dealers of the BrandSource buying group have managed to outmaneuver the national chains on inventory and even receive customer referrals from out-of-stock box stores. But to varying degrees, the scramble for appliance SKUs is expected to continue at least through the July 4th holiday period. According to Chad Evans, AVB's vice president of merchandising, the glacier-like supply chain has thawed somewhat since December, and the feeling among members is that things are getting a little better, but there still remains a long way to go. "Appliance vendors are starting to chip away at backorders and are now keeping up with new orders," Evans told YourSource. "They're adding new efficiencies and production lines and are focused on top- selling SKUs." And some, he added, have stopped producing slower ones. That said, availability still varies by category and brand, and dealers must continue to be nimble and flexible to keep their delivery trucks rolling. "Some manufacturers have dishwashers and others are still struggling," Evans said. "Some have cooking inventory and others don't." At press time, refrigeration and entry- to mid-priced top load laundry remained tight across the board due to consumer demand and COVID-19 flareups that have crimped production. At the factory level, "One of the biggest issues is getting people to work," he said, either due to illness or the disincentive of stimulus checks. And while supplies of side-by-side refrigerators are expected to remain strained through the balance of 2021, it's hoped that overall appliance availability will ease by the third quarter. "It's a moving target," Evans said, "but we're looking at a July 4th timeframe for the situation to get closer to normal." If any positives have come from the product shortages, it's that irrational, margin-choking appliance promotions have abated, at least for the short term, and it's the wish of independent dealers that they don't come back. Given BrandSource members' record sales last year, "We hope vendors have learned that there's no need for intense, weekly promotions, and that they can be limited to promotion during the holiday periods alone," Evans said. Some manufacturers, including Bosch, LG and Whirlpool, have already imposed moratoriums on discounting, which he considers a positive sign. "BrandSource's share gains prove the viability of our channel," he added. "We're very robust and can do things the box stores can't." Looking out at the 2021 model year, Evans is eagerly awaiting the launch of new appliance products and innovations, which are already in the pipeline despite some pandemic-related delays. Dealers can look forward to new category types and configurations, such as LG's single-unit WashTower laundry pair, and replaceable color panels, like those in Samsung's Bespoke platform, that allow owners to change the color and finish of their fridges. Other trends to watch for include a focus on four-door refrigeration, and vendors' aggressive pursuit of slide-in cooking, which should make the category more affordable for more consumers, he said. Much of the new product will be on display at BrandSource's Summit 21 virtual spring meeting and expo, to be held March 23-25. Also on tap for the group is a major push into luxury appliances, which will include marketing programs with major super-premium brands and specialized sales training, Evans said. Stay tuned… Alan Wolf Appliance Trends RO INVENTORY UPDATE: APPLIANCE BACKORDERS BEGINNING TO EASE, BUT SLOWLY Alan Wolf is Senior Communications Specialist for AVB/ BrandSource, the nation's leading merchandising and marketing co-op for independent appliance, consumer tech and home furnishings dealers. Appliance makers are "chipping away at backorders," AVB's Evans says. Seen here, GE Appliances' new dishwasher line in Louisville.

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