Welcome to Influencers, our annual series that speaks with the heads of retailers, suppliers and industry bodies to find out what is happening in appliances and electronics and how different companies are shaping its future.
Simon Taylor is the managing director of Arisit, marketers of appliances under the Ariston, Indesit, Scholtès, Sirius, Alfresco, Capital, Midea and Steel brands. He says margins are being squeezed and the solution is ‘genuine partnerships’ between vendors and retailers.
How has the first half of 2014 been for your business?
Arisit distributes 11 brands through Harvey Norman and Narta and overall our sales have been excellent, however, margins have been squeezed. Commercial sales have been very strong.
What are your predictions for the second half of the year?
With housing shortages commercial sales will lead the way with excellent growth and consumers will start to feel more confident now the budget has been announced and they realise the increased equity in their homes. Categories like cooking will continue to grow on the back of this and the popularity of television shows, such as My Kitchen Rules and MasterChef.
Returning net profit to retailers will be a main talking point, along with declining ASPs.
What opportunities do you see for the electrical retailing industry?
If the main discussion will be about profit then maybe we will see some genuine partnerships between wholesale and retail. They will take form with true exclusives with a point of difference.
What threats are currently present in the industry?
With the decimation of the browngoods industry in regards to margins and declining ASPs, everyone is jumping on the cooking and whitegoods categories. This increase in competition from both wholesale and retail will repeat what happened to browngoods; the next two years will be very interesting.
We will see more brands trying to sell direct to the consumer utilising the web and, in return, retailers will start importing their own products, like what Bunnings does.
What is your favourite product of 2014 so far?
Freestanding cookers have been declining for years due to lack of innovation but our new Steel cookers utilise combi-steam for the first time and the results are astounding. The brand dates back 70 years and has a commercial feel. With an average sell price of $7,000, it will double the average selling price for the category and be very profitable to the retailers.