As the economy rebounds, major electronics and appliance manufacturers continue to develop new and improved products at a rapid pace. This is an industry with an ever-evolving landscape. To navigate these changes, there are three key ideas consumer electronics and appliance companies should keep in mind.
1.) Realize, forecast and adjust to new variables: According to ibisworld.com, consumer electronics stores generated over $80 billion in revenue in 2012. They also expect a 3% annual growth in revenue through 2017. However, the competitive landscape has changed. Demand for electronics is driven by disposable income. And while disposable income has steadily risen since 2008, the economy’s volatility and consumer risk tolerance has led to a price conscious market. Additionally, there are many more channels available for consumers to purchase products. Department and warehouse stores are able to leverage their larger purchasing power and offer bargain pricing. There is also a rapidly growing on-line and e-commerce presence for these products. Without the high overhead and operating costs of traditional brick and mortar outlets, these companies also offer convenience and savings.
2.) Speed: With the high velocity of products and rapid evolution of technology, the ability to adapt and react quickly is essential. Consumers want the newest, fastest technology available and they want it delivered as quickly and conveniently as possible. The supply chain is the vital link between your product and your customer. Having effective, efficient processes in place can be a key differentiator not only in market share, but customer retention.
3.) Resource management: The above factors and your response to them will largely be impacted by how you manage the resources and leverage your partners. While price points may not be the ideal competitive ground, the risk can be mitigated by streamlining your internal and external processes. Discovering ways to efficiently store, ship and monitor inventory, going to and from retail outlets and customers, can be an effective way to trim expenses and pass those savings along to the consumer, maintaining your margins and creating an opportunity to compete and differentiate.
Negotiating these growing changes in competition, demands and expectations can be the difference in growing or losing profit margin. Combating new competitive and economic factors through expertise, resource management and technology can be directly achieved through a lean, streamlined supply chain. Barrett Distribution Centers leverages technology and their experience in the consumer electronics sector to design and implement customized logistic plans for companies. For more information on the Barrett Blueprint ® and how Barrett can help your business, click here.