U.S. Housewares Retail Market

6400 Shafer Court, Suite 650, Rosemont, IL 60018 Phone 847.292.4200 Fax 847.292.4211 www.housewares.org

U.S. Housewares Retail Market

Presented by

March 9, 2011

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The International Housewares Association Is The Home Authority

• Not-for-profit, full-service trade association• Founded in 1938• The voice for the housewares industry• 1,600 supplier members• Sponsors of the International Home + Housewares Show

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Stores You Will VisitToday*

Best BuyBloomingdales

BrookstoneThe Container Store

Crate&BarrelHome Depot

Macy’sPottery Barn

TargetWal-Mart

Whole Foods MarketZ Gallerie

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Headlines

Big-name U.S. retailers are increasingly hunting for growth overseas as American consumers continue to guard their wallets, purchasing cautiously.

Kiplinger 1/17/11

Stuck in the middle, big grocers make changes: Pressures from discount chains, upscale markets force changes

Chicago Tribune 1/6/11

Retail Up for 2010 Christmas Season: Early returns are finding that retail sales were the highest in the 2010 Christmas season that they’ve been in five years.

The Glittering Eye 12/28/10

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Headlines

The bad news [for restaurants] is that people aren't dining out as often. According to our surveys, Americans ate out an average of 3.3 times per week before the recession. In 2010, that number dropped to 3.1. Similarly, in 2007, 53% of all meals were prepared outside the home; now it's 47%.

Wall Street Journal, 1/25/11

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TrendsSales Up, But Stores Fret Over Outlook

Retailers saw their best holiday season since the start of the recession, but a loss of momentum in December fed concerns about the strength of the sector's revival in the new year.December retail sales at stores ranging from car dealers to grocers rose 7.9% from a year ago, the Commerce Department said Friday, and overall sales surpassed their pre-recession peak.

Wall Street Journal, 1/15/11

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Trends

Wall Street Journal

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Breaking News

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Global Housewares Market

Insert new chart

Global Housewares Retail Sales 2009

US$288.4 Billion

US and Canada $75.7

Latin America $11.7

Western Europe $76.1

Asia $91.8

Africa $12.1

Eastern Europe $ 8.4

Middle East $ 8.2

Oceania $ 4.8

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Housewares SalesBy Key Retail Channel

Discount Stores/Supercenters 24.3%

Department Stores 14.2%

Specialty Stores 11.6%

Non Store Retailing 9.3%

Supermarkets 8.3%

Hardware Stores/Home Centers 5.5%

Warehouse Clubs 4.8%

Variety/One Price Stores 2.7%

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Discount Stores & Supercenters

24.3%

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Top Discount Store: Wal-Mart*Parent Company: Wal-Mart Stores

General Profile: Wal-Mart is a global retailer providing a broad assortment of quality merchandise and services at everyday low pricing.

Subsidiaries: Sam’s Club

Number of stores in U.S.: 3,708

U.S. regions: National

Total sales: $258,200 Million in 2009

Housewares sales: $20,290 Million in 2009

Housewares sales rank in top 100: 1

* Source: HomeWorld Business


Retail Intelligence ReportWal-Mart, king of retail, plots

rebound The battle for shoppers is playing out in this New York suburb. Wal-Mart versus everyone. Dollar stores beckon, their small size ideal for quick shopping. Target offers 5 percent off if you pay with its store-branded card. Costco tempts with high-end, brand-name food and designer clothes at competitive price. Over the past year, revenue at Wal-Mart stores open at least a year has fallen by an average 0.75 percent each quarter, according to the International Council of Shopping Centers. Revenue rose by an average of 1.7 percent at Target, 8 percent at Costco and 5.9 percent at Family Dollar.

Associated Press, 2/5/11


Retail Intelligence Report

Walmart Launches Major Initiative to Make Food Healthier and Healthier

Food More AffordableWalmart Press Release 1/20/11


Retail Intelligence ReportWalmart Tries to Recapture Mr. Sam’s

FormulaWal-Mart already commands so large a portion of customers’ wallets that growth is a Herculean task…Goldman Sachs recently estimated that for Wal-Mart to notch a 1% increase in comparable store sales, every person in the US would have to spend an additional $10 at the chain.

Wall Street Journal 2/22/11



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Discount Store: Target*

Parent Company: Target Corporation

General Profile: Target strives to be the best place to buy high quality merchandise at low prices. They are an upscale discounter.








Retail Intelligence ReportTarget Expands into Canada

Target, the US discount retailer known for its “cheap chic” image, is to invest more than $2.8bn in opening up to 150 stores in Canada by 2014, in its first international expansion.

The retailer, which operates more than 1,750 large format stores in the US says it has agreed to pay C$1.82bn to acquire leases to up to 220 sites currently operated by Zellers, a Canadian discount retailer that is the subsidiary of the Hudson’s Bay Company (HBC).

Financial Times, 1/20/11

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Parent Company: Sears Holdings



Total sales: $15,743 million in 2009

Housewares sales: $2,240 million in 2009


Discount Store: Kmart


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Other Discount Stores

Store2009 Housewares Sales (US$ millions)

Meijer’s $ 649

Shopko Stores $ 422

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Department Stores

14.2 %

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Department Store: Macy*s* Parent Company: Macy*s Group

General Profile: Macy*s Group, Inc. is the US's leading department store retailer. A tradition of exceptional shopping and lifestyle leadership.

Subsidiaries: Bloomingdale’s

Number of stores in U.S.: 850

Total sales: $243,489 in 2009

Housewares sales: $1,090 in 2009





Macy’s Earnings Increase 50%

[New merchandising] initiatives allowed 4.3% growth in sales in the quarter, “on the high end on the aggressive guidance we set for ourselves.”


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Top Department Store: Sears*

Parent Company: Sears Holdings

General Profile: Sears is a multi-line retailer offering a wide variety of merchandise and related services

Divisions: Kmart, The Great Indoors

Total Stores: 2,235







A Tough Sell at SearsThis holiday season, Sears and Kmart, which merged in 2005, are pushing a single message: Buy with layaway, buy with coupons, buy now and pay later, buy with loyalty rewards points — but please, just buy.

Five years after the merger, Sears Holdings is beleaguered, with sales markedly worse than its competitors’. The company’s revenue dropped more than 10 percent from 2005 through 2009, the most recent full fiscal year. In the same time period, Walmart’s sales rose almost 31 percent, Target’s more than 24 percent and Macy’s about 5 percent. Sales at JCPenney declined by about 6 percent.

New York Times 1/21/11

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Department Store: Kohl’sParent Company: Kohl’s Department Stores

General Profile: Kohl's mission is to be the leading family-focused, value oriented, specialty department store offering national brand merchandise to the consumer in an environment that is clean, friendly and convenient.






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Other Department Stores

Store2009 Housewares Sales

(US$ millions)

TJMaxx/Marshall’s $570

JCPenney $275

Dillard's $119

The Bon Ton $106

Belk $105

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U.S. Specialty Stores

11.6%

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Specialty Store: Bed Bath & BeyondParent Company: Bed Bath & Beyond

General Profile: Bed Bath & Beyond is a national chain of superstores selling predominantly better quality domestic merchandise and home furnishings. Bed Bath & Beyond aims to combine superior service with a huge selection of items at everyday low prices within a constantly evolving environment.







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Specialty Store: Williams Sonoma

Parent Company: Williams Sonoma

General Profile: Williams Sonoma is a specialty retailer of high-quality products for the home and kitchen.

Subsidiaries: Pottery Barn, Pottery Barn Kids, West Elm







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Specialty Store: Sur La Table

Parent Company: Sur La Table

General Profile: Sur La Table was created to satisfy the growing demands from culinary professionals and home chefs for a reliable source of top quality cookware and hard to find kitchen tools.


Total sales: $205 Million in 2009

Housewares sales: $2124 Million in 2009



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Specialty Store: Crate&Barrel*

Parent Company: Crate&Barrel

General Profile: Crate and Barrel features unique, functional, affordable designs for the home. They carry innovative, high quality design productsfocusing on shape, form, color and function.

Subsidiaries: CB2





Housewares sales rank: 19


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Specialty Store: Pier 1

Parent Company: Pier 1 Imports

General Profile: North America's leading specialty retailer of unique, fashion forward, decorative furnishings, gifts and related items directly imported from over 50 countries around the world.








Retail Intelligence ReportPier 1 Imports, Inc. Announces

December Sales Results

FORT WORTH, Texas, Jan 06, 2011 (BUSINESS WIRE) -- Pier 1 Imports, Inc. today reports December sales results for the five-week period ended January 1, 2011.

December Highlights•Comparable store sales increase of 10.3% compared to last year's increase of 8.6% •Comparable store sales were driven by increases in traffic, conversion rate and average ticket •Merchandise margins were strong in December with less promotional and clearance pricing compared to last year

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Specialty Store: Cost Plus World Market

Parent Company: Cost Plus World Market

General Profile: World Market is a leading specialty retailer of casual home furnishings and entertaining products. Their strategy is to differentiate themselves by offering a large and ever-changing selection that combines wine, beer, food and home products, many of which are imported, at value prices in an exciting shopping environment.








Retail Intelligence ReportCost Plus, Inc. Confirms Merchandising Test

with Bed Bath & Beyond

December 10, 2010 – Cost Plus, Inc. today confirmed that it is conducting a merchandising test with Bed Bath & Beyond involving its consumables products in three Bed Bath & Beyond stores located in San Diego, California; Totowa, New Jersey and Elmsford, New York. Cost Plus continually evaluates merchandising initiatives, including the merchandising test taking place with Bed Bath & Beyond. Cost Plus does not comment on merchandising tests.

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Specialty Store: The Container Store*

Parent Company: The Container Store

General Profile: The Container Store is devoted to helping people streamline and simplify their lives by offering an exceptional mix of storage and organization products.


U.S. regions: 12 States





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Specialty Store: HomeGoodsParent Company: TJX Companies

General Profile: HomeGoods is a chain of off- price home fashion stores. HomeGoods offers an exciting, and rapidly changing selection of home décor merchandise including furniture, giftware, rugs, bed and bath accessories, lamps and seasonal merchandise at great values.







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Specialty Store: Best Buy*

Parent Company: Best Buy

General Profile: America's leading specialty retailer of consumer electronics, personal computers, entertainment software and appliances.

Subsidiaries: Magnolia Audio Video, The Future Shop







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Specialty Store: IKEA

Parent Company: Ingka Holding B.V.

General Profile: IKEA is a full-range specialty retailer selling a wide range of home furnishings with good design and function.






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Other Specialty Stores


(US$ millions)Kitchen Collection $214Ross Stores $166Michaels Stores $ 71

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Non Store Retailing

9.3 %

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Internet: amazon.com

Parent Company: Amazon

General Profile: Amazon is the largest online retailer in North America






Retail Intelligence ReportRetailers Struggle in Amazon Jungle


Retail Intelligence ReportGift Shoppers Flocked to the Web

Online Christmas Sales Rose 15.4% as Retailers Offered Free Shipping and Internet-Only Bargains

WSJ, 12/24/10

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Supermarkets

8.3 %

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Top Supermarket: Kroger

Parent Company: Kroger

Subsidiaries: Bakers, Calla Foods, CityMarket, Dillons, Food4Less, Fred Meyer, Frys, Gerbes, Hilander, Jay C Foods, Kessel Food Markets, King Soopers, Payless Super Markets, QFC Quality Food Centers, Quik Stop, Ralph's, Smith's Food & Drug, Tom Thumb Food Stores






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Supermarket: SuperValu

Parent Company: SuperValu

Subsidiaries: Acme, Albertson’s, Jewel-Osco, Supersaver Foods


U.S. regions: 31 States





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Supermarket: Safeway

Parent Company: Safeway

Subsidiaries: Carrs, Dominicks, Genuardi's, Pac n Save Foods, Pavillions, Randalls, Tom Thumb, Von's







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Supermarket: Whole Foods Market*

Parent Company: Whole Foods Market

Subsidiaries: Wild Oats







http://www.yelp.com/biz_photos/hLpJP1rngQUeWokxTL1BDw?select=BzhejDiL2dF4nOAhwoiJ3Q

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Other Supermarkets

Store2009 Housewares Sales (US$ millions)

PublixAhold USADelhaize America

$409$359$264

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Hardware Stores & Home Centers

5.5 %

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Hardware Stores & Home Centers: Home Depot *

Parent Company: Home Depot

General Profile: Home Depot is the world's largest home improvement retailer.







Home Depot Looks to Women ConsumersSince its founding in 1978, Home Depot and its orange-smocked employees have ruled the American home improvement industry, making it the second-largest retailer in the country, after Wal-Mart.

In its bid for more revenue, Home Depot has recognized that while women may be half of its customers, it has not catered to them in ways that translate into a larger market share. Without a housing recovery to revive sales of big items or major renovation supplies, the company and its competitors are promoting smaller projects in spring 2011, during what is the major selling season for home improvement stores. And that means sprucing up departments to get female customers excited about window treatments or new colors for makeovers of existing spaces.



Retail Intelligence ReportHome Depot Profit Jumps 72%

Home Depot cited sales of big ticket items such as appliances, millwork, windows and heating units as helping drive purchases of $900 or more in the fiscal fourth quarter.


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Hardware Stores & Home Centers: Lowe’s

Parent Company: Lowe’s Companies Inc.







Retail Intelligence ReportInvestors cheer Lowe's plan to lay off 1,700 middle

managersLowe's Cos., the home improvement giant, is laying off 1,700 middle managers across the country, another sign that the economic recovery remains in a precarious position.

It will also hire 8,000 to 10,000 part-time, weekend sales workers, a move Lowe's said is intended to boost customer service at peak sales times.

Like the rest of the economy, Mooresville-based Lowe's has suffered through the housing downturn. The company says consumers are still hesitant to invest in their homes, buying fewer major appliances and putting large remodeling projects on hold.

Charlotte Observer 1/26/11


Retail Intelligence ReportLowe’s quarterly profit climbs 39%

Lowe’s Cos. said Wednesday that its fourth-quarter profit rose 39%, boosted by what it described as a continuing economic recovery.

Still, the No. 2 U.S. home-improvement retailer gave a first-quarter profit forecast that may fall short of Wall Street expectations, citing market uncertainty. Also, its smaller-than-expected 1.1% rise in same-store sales trailed that of its larger rival Home Depot Inc., which recently reported a 3.9% increase.

MarketWatch 2/23/11

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Hardware Stores & Home Centers: Ace Hardware

Parent Company: Ace Hardware

General Profile: Ace is a cooperative composed of members who are entrepreneur retailers.






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Hardware Stores & Home Centers: True Value

Parent Company: True Value Corp.

General Profile: True Value is a cooperative composed of members who are entrepreneur retailers. True Value grew in 1997 when Servistar/Coast to Coast merged with Cotter & Co, then True Value’s parent company.






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Other Hardware Stores & Home Centers


(US$ millions)

Do It Best $451Menard's $189

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Warehouse Clubs

4.8%

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Warehouse Club: Costco

Parent Company: Costco Wholesale Corp.

General Profile: Costco Wholesale operates an international chain of membership warehouses that carry quality, brand name merchandise at substantially lower prices than are typically found at conventional wholesale or retail sources. The warehouses are designed to help small and medium sized businesses reduce costs in purchasing for resale and for everyday business use.






Retail Intelligence ReportDecember Retail Sales Are Weaker Than

Expected

At Costco Wholesale, Same store sales rose 6 percent, just a bit below analyst expectations of 6.2 percent.



Retail Intelligence ReportCostco Profit Tops Expectations

Costco posted a better-than-expected quarterly profit on Wednesday, helped by strong sales and increased fee revenue as consumers sought its bulk offerings of food and other items.

Gross margins rose to 10.98 percent from 10.88 percent, though the improvement was less than some analysts had expected because of strong sales of lower-margin gasoline.


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Warehouse Club: Sam’s ClubParent Company: Wal-Mart Stores Inc.

General Profile: Sam's Club is the nation's largest member only warehouse club in terms of number of stores.






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Other Warehouse Clubs


(US$ millions)BJ’s Wholesale $1,085

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Drug Stores

4.2 %

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Drug Store: Walgreens

Parent Company: Walgreens

General Profile: Walgreens is the nation's largest drug store chain.






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Drug Store: CVS

Parent Company: CVS

General Profile: CVS is the nation's second largest drug store chain.






http://upload.wikimedia.org/wikipedia/en/d/dd/CVS_Caremark.png

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Variety/One Price Stores

2.7 %

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One Price Store: Dollar General

Parent Company: Dollar General

General Profile: Dollar General is the nation's largest dollar store chain.






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One Price Store: Family Dollar

Parent Company: Family Dollar

General Profile: Dollar General is the nation's second largest dollar store chain.






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One Price Store: Dollar Tree

Parent Company: Dollar Tree

General Profile: Dollar Tree is the nation's third largest dollar store chain.







Retail Intelligence ReportDollar Tree Sales/Profits Skyrocket

Dollar Tree Announces Q4 2010 Sales up 10.7%, FY 2010 Sales up 12.4% Sales increased 10.7% to USD 1.73 billion for the quarter. Year-to-date (YTD) sales increased 12.4% to USD 5.88 billion. Comps increased 3.9% and 6.3% for the quarter and YTD, respectively.

Kantar Retail 2/24/11


http://www.housewares.org/iha/pubs/mw/default.aspx


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http://www.housewares.org/ppt/USHousewaresMkt_11.ppt

Find this presentation at:

Perry Reynolds

Contact me at

[email protected]


U.S. Housewares Retail Market

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