and Outdoor Equipment Stores industry has been wilting over the
five years to 2011, with a multitude of factors adversely affecting
its landscape. Poor economic conditions, such as falling consumer
confidence and disposable income, have reduced discretionary
spending, driving down demand for new lawn and garden equipment.
IBISWorld projects that the Lawn and Outdoor Equipment Stores
industry will remain relatively unchanged in the five years to
2016, with revenue virtually stagnant.
IBISWorld Market Research Competition from home improvement stores will continue to restrain industry revenue and profit growth The Lawn and Outdoor Equipment Stores industry has fought through declining demand in the five years to 2011, with revenue falling at an average annual rate of 3.8%. According to IBISWorld industry analyst and report author Mary Nanfelt, ?as consumers' confidence in the economy and disposable income dwindled following the housing market's collapse, households cut back on discretionary spending, including on lawn and garden tools. In particular, sales for big-ticket items have suffered since the recession because consumers have kept their wallet closed. However, sales of less-expensive products have offset some of the industry's demise. Many households that traditionally hired gardening services have increasingly invested in smaller equipment to take care of their lawns.? From 2010 to 2011, revenue is expected to increase by 0.6%, to total $5.2 billion.
In addition to falling demand, Nanfelt says ?competition from home improvement stores like The Home Depot and Lowe's has held back the industry's growth. By leveraging their size, these national retailers can achieve significant cost savings on comparable products and pass them down to consumers in the form of lower prices. Therefore, these stores have increasingly attracted customers away from lawn equipment specialty stores and outdoor power equipment dealers. As companies reduced their price markups to remain competitive, the industry's average profitability declined.? IBISWorld estimates that profit margins have decreased to less than 2% of revenue. Such poor industry performance has caused many retailers to merge with other players or exit the industry. The number of enterprises declined at an average annual rate of 3.6% during the period, from 3,994 in 2006 to an estimated 3,328 in 2011.
The Lawn and Outdoor Equipment Stores industry is characterized by a low level of concentration and a high number of companies. This is because a large number of small and independent players dominate the industry; most businesses only cater to their local or regional demand. In fact, of 3,300 businesses that are expected to participate in this industry this year, the majority will be of small stores with fewer than 10 employees. As such, there are no major players that account for a considerable share of the industry.
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IBISWorld industry Report Key Topics
Operators in this industry sell lawn and outdoor power equipment and replacement parts to household consumers, farmers and ranchers, and other professional workers. Products include rotary mowers, rear engine riding mowers, garden tractors and shredders, chainsaws, leaf blowers, brush cutters, hedge trimmers and more. Players in this industry also provide repair services.
Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios
About IBISWorld Inc.
Recognized as the nation?s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.
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