Tag Archives: appliances

The home appliance market has a lot to celebrate: As the housing market continues to recover – however slowly – new homeowners with disposable incomes will seek brand-new appliances to furnish their spaces. Yet, appliance manufacturers ought to stay aware of burgeoning trends that could impact their product designs, compliance efforts, and the reception of their goods.

1. Possible housing shrink
For the most part, American homes are bigger now than they have ever been – according to U.S. Census Bureau data released in 2015, the average single-family house ballooned by more than 1,000 square feet between 1973 and 2014.

However, appliance manufacturers should refrain from letting such growth lull them into a false sense of security over the size of their products. Other market factors indicate the economic upturn that empowers young homebuyers could also push them to be more conservative with space. Both the median and average sizes of newly built single-family homes plateaued in the last few years and have even begun to drop.

Are American homes trending tinier? What does that mean for the home appliance manufacturer?

Could this be the start of a new generation of smaller entry-level homes? If so, appliance makers will need a strategy for quickly developing and producing goods with smaller footprints.

2. Easing refrigerant regulations
Earlier this year, the Association of Home Appliance Manufacturers pledged to stop using hydrofluorocarbon refrigerants in next-generation goods, phasing them out entirely by 2024. The organization asked for assistance from both the United States and Canadian governments, as current regulations may be too strict for alternative refrigerant options under consideration.

With all appliance makers have done in recent years to increase the energy efficiency and environmental sustainability of their products, refrigerant changes could place financial and operational strains on residential and commercial refrigerator, freezer, and air conditioner manufacturers looking to stay green. Participation from the AHAM should be seen as a give-and-take: Appliance makers will make the switch, if the government helps businesses shoulder the burden by loosening materials regulations.

Effective earlier this month, the U.S. Environmental Protection Agency did end up expanding feasible HFC substitutes to include propane. However, the appliance industry should take note of the estimated annualized compliance costs for 100 affected companies included in the EPA notice: between $58.8 million and $71.3 million depending on a 3 percent versus 7 percent discount. Manufacturers should begin formulating a basic framework of the organizational change required to keep production swinging, risk management on task, and operational costs even.

3. Consumer input online
While manufacturers may have the retail “middleman” separating them from end users, the expanding online marketplace for appliances could open a direct connection – and not necessarily in a good way.

PricewaterhouseCoopers research shows today’s consumers still choose to purchase their appliances at brick-and-mortar stores over online – 59 percent to 29 percent respectively – but the gap is closing fast. Mobile devices also make it easier for shoppers to investigate in-store goods before buying, which should worry manufacturers who haven’t vetted their digital presence and addressed any concerns flagged on the internet by former customers. A bad review with good search engine optimization can hang like an albatross around a company’s neck.

Responsiveness to customer concerns in online forums will only better a business as we push further into the future. As appliance manufacturers strive for innovation in their products, they should give equal attention to the channels of hype surrounding their brands.