U.S Major Home Appliance Industry in 2002
The household appliance industry is huge! The number of household appliance grows every year, but there is one sector of the industry, the major appliance sector that remains constant. The appliances that comprise this sector are ranges, refrigerators, washers, dryers, and dishwasher. The major appliance industry is both saturated and mature. The five major players are General Electric, Maytag, Whirlpool, Electrolux, and Raytheon. All are well established in the industry and have been major players for many years.
Prior to World War II, most appliance manufactures produced a limited line of appliances derived from one successful product. For example, General Electric made refrigerators, and Maytag focus on washing machine. During this era a company was reluctant to enter the market of another company. It was not until 1945 that firms begin to offer full lines of various appliances.
The industry almost double in size during the 1960s, as sales of several products grew rapidly. The sales continue to increase in the 1970s despite the high interest rates and inflation. During the 1980s the industry was beginning to expand, because of the acceptance of the microwave by the U.S. consumers. By 1990s, U.S. manufactures offered a full range of products even if they did not make the items themselves.
By 2002, new technologies and designed were being introduced into major home appliances. Due to governmental pressure, appliance manufactures were introducing energy efficient versions of refrigerators and washing machines. Today's kitchens are often the entertainment center of the home. Many consumers are demanding appliances that are attractive, convenient and easy to clean. Many consumers are willing to pay top prices for top of the fine appliances that enhances their décor's and save precious time. The manufactures have responded to the consumer demands, by manufacture smart appliances with sophisticated electronic controls and self diagnostic features.
The major appliance industry is a stable and profitable industry, although it is mature and saturated in the United States, there are many growth opportunities available abroad. The industry will always be affected by interest rates, new housing construction, kitchen remodeling and the market for replacement appliances, but as long as consumers need take care of clothes and prepare foods, there will always be a market for major household appliances.
Finding of Fact#1: A concern for manufactures of home appliance was the environmental and government regulations standards that they must adhere to.
Once the war ended, soldiers returned home to find a prosperous economy with innovations and jobs. Sub-sequentially, in 1950 and 1960, the commodity industry was booming and citizens had disposable money to spend (Broughton 27). Manufacturing towns such as Galesburg saw immense prosperity. In ten years leading up to 1974, manufacturing jobs increased by 62% in 1974 and the area was quickly coined Appliance City (Broughton 33). However the economy started to shift and these companies needed to find ways to cut their costs and remain competitive to make a profit. For the decision makers in these firms, “everything boiled down to economics… what can a company do to reduce or minimize their costs” (Broughton 82). Instead of attracting cheaper labor, Maytag and other manufacturing companies relocated their plants in less developed companies, such as Mexico. This environment provided cheaper resources of all kinds. Maytag closed its Galesburg facility to open one in Reynosa Mexico and several other companies did the same. From 1998 to 2003, the United States lost three million manufacturing jobs (Broughton 64). This drastically killed American towns that were reliant on these jobs. Towns such as Galesburg lost their jobs and became a ghost
Lowe’s is leading the way by example. Lowe’s believes that creating long-term partnerships is a win-win situation for both sides of the deal. Lowe’s is the second largest home appliance retailer in the country, by working hand in hand for twenty-six years with Whirlpool, the largest marketer and manufacturer of home appliances. Whirlpool and Lowe’s have worked together to become unmatched in bringing their customers a high quality product and a very low competitive price. Through a tremendous logistical effort Whirlpool and Lowe’s have created a one of a kind Innovation Tour. A semi-trailer transforms itself into a functioning kitchen to show customers cutting edge appliances that will be available at Lowe’s in the future from Whirlpool and Kitchen Aid. As Lowe’s motto states, Lowe’s truly is “Improving Home Improvement”. (http://www.businesswire.com/)
Barry first discusses the impracticality of appliance manufacturers' desired features. They envision refrigerators which alert the consumer when they have run out of milk, transmits their weight to the gym, and allows the sharing of information on the internet. "I frankly wonder whether the appliance
Home Depot operates in the home improvement retail industry that comprises of retailer that sell appliances, lumber, building material, kitten fittings and other home improvement products aimed at improving existing structures. Companies functioning in the home improvement industry buy products from retailer and manufacturer based all over the world, and then put those products for sale on the market to three types of buyers, generally characterized as: do-it-for-me, do-it-yourself, and professional customers. The home improvement retail industry is well established industry and is highly attractive and there is high level of price competition among the key players of the industry as the products lines are all the same.
Some of these inventions such as the refrigerated railroad cars and the cigarette-rolling machine, formed a basis for new industries and fortunes. As the country expanded and industrialized, increasing emphasis was placed upon mass production and mass distribution. By speeding up production and increased the output of goods, and an industry could lower costs and maximize profits. As a result of mass production, factory owners often found themselves able to produce more goods than the market would absorb, therefore they needed to increase consumer
In the real world, life has its ups and downs. In the 1920's, corporations started to take better care of their workers than they had in the past. Workers were paid higher wages and worked shorter hours. With more time and money on their hands, workers turned into consumers, which caused an increase in the production of consumer goods. One of the most popular consumer goods was the automobile. To keep up with the high demand, the automobile industry had to create a way to make a lot of cars in a short amount of time, at a low price. The solution was the assembly line. With the assembly line the time to create one car dropped from 12 hours to 90 minutes. The price of the automobile fell greatly also, which further increased the demand. The automobile industry inspired other industries to form, such as the steel, rubber, petroleum, machine tools, and road building industries. But life wasn't just peaches and cream in the 1920's. Immigrants and farmers were facing some serious adversity. After World War I, the United States began to put a cap, or put a quota, on how many immigrants could come into the country.
I. How has an industry grown to become a 32 billion dollars a year machine?
According to Jason, “costs would fall if people adopt new energy-efficient technologies without a price hike in energy” (Shogren, 2004). A study done by Jaffe and his colleagues concluded that 20-25% of existing carbon emissions can be eliminated if people switched to fluorescent light bulbs, improved thermal insulation, more efficient heating and cooling systems (Jaffe, Newell, & Stavins, 2003). It all comes down to the consumers. Some of the energy efficient technologies are readily available but are still expensive. The driving force to efficient-energy technology depends on the changes of relative price. People will not want spend money on newer appliances especially if the prices are high, and if their current one still functions.
By the late 1970s the technology had improved to the point where prices were falling rapidly. Formerly found only in large industrial applications, microwave ovens (often referred to informally as simply "microwaves") were increasingly becoming a standard fixture of most kitchens. The rapidly falling price of microprocessors also helped by adding electronic controls to make the ovens easier to use. By the late 1980s they were almost universal in the US and had taken off in many other parts of the globe. So, McGovern, CEO of Campbell, also championed Campbell's move into new products and markets especially microwavable products. While the total market for such production in the U.S. was only $650million in 1987, it was expected to be over $3billion by 1992. Although Campbell's initial push in the early 1980s was into the frozen segment of this market, McGovern felt strongly that developing microwavable shelf-stable soups was not only a major opportunity but a necessity if Campbell were to retain its leadership of the soup business.
The automobile was only used by less than ten million Americans and by the end of this post-war decade that number had climbed to over thirty million. Many new inventions were coming through, making life for Americans much more comfortable. Radios, vacuum cleaners, irons, washing machines, and refrigerators were among the new necessities Americans just had to have. Refrigerators allow for better production and transportation of food products. This allowed for the ability to keep food cold and fresh, thus making exporting of food a valuable agricultural economy.
Because public luxuries are strong for product and brand, and brand is oriented by consumer and identity. Accordingly, brands are regarded as images in the identities of consumers and other identities of target groups (Esch, 2010), which are designed by companies to decide their products (Kotler et al., 2009). Luxury brands are highly associated with their core consumer (Kapferer, 2008). For example, Land Rover is one of the worlds company to produce four-wheel drives, is the famous British SUV brand. The prices of Land Rover mostly are depend on middle-class economic conditions and the appearance of the car and speed of it are based on the male identity, mostly giving a image of tough guy. Despite the fact that public luxuries are more relevant to identities ,which is contrary to the private necessities. For private necessities, such as Haier, is the worlds largest household appliances maker, the global brand share of Haiers refrigerators, washing machines are on the top of the world. Compared with the relationship between the identity and Haier, Haier is more focus on quality of its products. The 1980s, coincided with the beginning of reform in China, many enterprises to introduce foreign advanced technology and refrigerator equipments, likes Haier. At that time, home appliances supply less than demand, there had a lot of enterprises which only focused on production rather than on quality.
The history of the automobile begins with the technological advances that occurred in the USA with Henry Ford’s Model T. Since then, the automobile market has had its ups and downs, but it has no doubt flourished into an industry that is the cornerstone of many economies. The world economic collapse due to the Great Depression caused consolidation in the manufacturing market. However, after World War II, an expanding highway network fueled by economic growth as well as television advertising spurred sales for car companies in many countries. The globalization of the industry accelerated during the late 1990 's due to the establishment of overseas plants and the merging of large multinational corporations.
General Electric’s competitors are separated into two different tiers. The first tier of competitors are those that are direct competitors and include Honeywell, Siemens AG, United Technologies Corporation, and 3M Company. These companies compete with General Electric on a product basis. For the most part, these companies produce the same type of products. On the second tier of competition, General Electric is competing on the services side of business. General Electric competes with Bank of America, JPMorgan Chase, News Corporation, Viacom, and The Walt Disney Company. These companies all provide the types of financial services such as general lending, leasing, and asset management. Since the service and financial portion of the business does not hold precedent over the products they produce, these...
Starting in the 1920’s America began its shift towards a consumer culture as the economic growth of the nation began to depend more on the proliferation of consumer goods than of capital goods. Even at the outset of this trend, the automobile held a significant place in the new consumer economy. The automobile, which was once thought of as a rare luxury, was being sold by the millions. Assembly lines were becoming more efficient, thus allowing cars to be made more cheaply allowing the price of automobiles to drop. The growth of the automobile helped stimulate the economy through its dependence on other industries such as glass, rubber and steel, which were connected to the production of cars. These automobile related industries created new jobs, greater affluence and more spending power for millions of American consumers. Even at the beginning of America’s transformation into the consumer culture of today the automobile was at the forefront this conversion.
The newly appointed district sales manager, Larry Barr, faces the problem of allocating sales quotas among his various sales representatives. This decision will affect everyone's earnings including his own. This problem is compounded by the fact that different territories have, for a variety of reasons, different potentials. In addition, the territory that is known to be the toughest will soon require a new sales rep.