China Large Appliances Market Forecast to 2020: Ken Research

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China Large Appliances Market Forecast to 2020
Ken Research
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How China Large Appliances Market Is
Positioned? Large appliances are considered as
durable consumer goods which have varying
replacement rate depending on type of appliance
and user experience desired. It is a very dynamic
market and continuous innovation is required to
make the products more economical and user
friendly.
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It was reported that urban households in China
own television sets, washing machines,
refrigerators and air conditioners per 100
households. Urbanization in China was at in
2015 which translates into million people
living in urban locations. Living conditions of
rural population is also improving as an
investment in infrastructure has helped in better
connectivity and living conditions of people.
There is significant rise in the ownership of
large appliances in rural areas especially air
conditioners and refrigerators. It has increased
from air conditioners in 2010 to air
conditioners and to refrigerators per 100
household in rural areas in 2014. Demand for
large appliances in China is mainly driven by
replacement of existing old products with new
ones. Demand for large appliances has increased
from million in 2010 to million in 2015
registering a CAGR of . In terms of revenue
market has increased from USD billion in 2010
to USD billion in 2015 registering a CAGR of
. Programs like Go rural subsidy, subsidized
trade in home appliances, launch of energy saving
products has helped large appliances companies to
make substantial sales increase in 2011. Volume
sales increased from million in 2010 to
million in 2011.
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• The sales of large appliances during 2013
  witnessed launch of many smart consumer
  appliances which became the major growth driver
  especially driving the replacement demand. This
  helped the large appliances market to register a
  positive growth rate of in 2013. Programs like
  go rural have helped to develop sales network in
  rural areas which has benefitted the market in
  2013 and years after.
• What have been the Major Segments that has Driven
  Change
• Demand for refrigerator has risen initially in
  2011 but after that continuous decline was
  registered in sales volume. Sudden rise in demand
  for refrigerator in 2011 was mainly due to demand
  coming from rural areas especially on account of
  subsidy offered which started in 2009.
• Majority of the demand for refrigerator in urban
  areas was witnessed for larger size refrigerators
  with multiple doors, energy saving rating and
  other added features. Average size of the
  television being demanded in China has registered
  a consistent increase. The demand preference has
  increased in first quarter of 2012 from 37.8
  inches to 45.3 inches in first quarter of 2016.

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• Demand for television was mainly driven by
  replacement with high end technology products.
  For instance, CRT TV is not manufactured by any
  major TV manufacturing company in China. Consumer
  preference has changed to LED and Curve
  television with many other added features.
  Television market in china was dominated by
  Skyworth, Hisense, TCL, Changhong and others. Top
  three companies have accounted for a revenue
  share of more than during 2015.
• During 2015, around million washing machines
  were sold with an aggregate value of USD
  million. Replacement demand for existing washing
  machines was the major reason for growing demand
  for washing machine. Replacement demand has
  accounted for more than of total domestic
  sales of washing machine in China during 2015.
• Market demand for new technology based air
  conditioners was on the rise in 2015. Retail sale
  of artistic high end intelligent air conditioner
  accounted for sales volume in 2015 registering
  year-on-year increase of .

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Sale of new air conditioner to replace existing
air conditioner accounted for approximately of
total sales in 2015. Distribution and sales
network for large appliances has evolved over a
period of time. More and more companies are
focusing to create a centralized distribution
network to reduce inventory and give better
consumer experience by promoting timely delivery
and installation. Companies such as Haier have
separate logistics company to handle distribution
and sales network of large appliances in
China. Which Large Appliances are Majorly
Preferred by Chinese? With ever improving
technology and picture quality, demand for large
screen television is on the rise. The demand for
television with size greater than 45 inches has
consistently increased during the period
2012-2015. Decline in final price of the
television has helped to augment the market for
large screen size. Reduced thickness achieved
with improvement in technology has reduced the
space occupied and is also the very important
reason for the increased replacement demand for
CRT TV in urban cities where personal space is in
limited quantity.
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With rising purchasing power of consumers in
China, the demand for high end technology and
large volume refrigerators has increased. The
volume share of multi-door and bi-fold
refrigerators has showcased an increase with
share increasing from in 2011 to in 2015.
The companies are launching smart and efficient
refrigerators with advancement in technology
through consistent product modification. There
has been substantial decline in product demand
for low cost machine mainly due to smaller
capacity and demand for high end and automatic
and smart machine. From macroeconomic
perspective, rising urbanization and high per
capita income in urban areas has led to increase
in demand for high end and costly refrigerators
as they are technologically more advanced and
have high capacity. Demand for pulsator type or
front loading washing machine was on the rise on
account of its efficiency and reduced water
consumption and faster cleaning.
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• These positive attributes have contributed
  significantly to growth in share for pulsator
  type washing machine. Rising demand for energy
  efficient and increased scarcity of water has
  promoted the sale of roller type washing machine.
  
• Increased demand for energy efficient and low
  water consuming washing machines has promoted the
  sale of more expensive roller type washing
  machine. Increased demand for these products has
  led to increased share of products which are
  priced above RMB 3,000.
• Front loading washing machines have shown
  continuous increase in demand on account of its
  high efficiency and low water consumption.
• The share of front loading washing machine have
  increased significantly over the years with
  market share rising from in 2013 to in
  2015. Most of the new washing machine launched in
  China market is of front loading type. Top
  loading machines still dominate the market owing
  to their low prices.

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Focus on energy efficient products has led to
increased demand for inverter type air
conditioners (frequency conversion) which are
more efficient and consume less power compared to
normal air conditioner. These air conditioners
being energy efficient products, saves a part of
the cost on electricity bill this saving on
electricity bill promotes the consumers to invest
in energy efficient air conditioners. Over the
years, the volume share of frequency conversion
type air conditioner has increased from in
2011 to on 2015. Air conditioner is high
priced product with majority of demand coming
from products priced above 3,000 RMB. In 2015,
of the demand for air conditioners was originated
from products priced above RMB 3,000 demand for
high priced product. This was mainly on account
for better and more energy efficient products.
Demand for air conditioner was mainly reported
from urban areas where per 100 household
ownership was reported at 107.4 in 2014.
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• How the Logistics is Handled for Large Appliances
  by Online Companies in China?
• Most of the manufacturers have their own logistic
  system and they use their services for supply to
  warehouse and delivery at location of
  whole-sellers, retailers and exclusive stores.
  Fully developed logistics system is necessary to
  cut down on inventory and ensure faster delivery
  in very competitive market.
• Midea group consolidated its internal and
  external social logistics resources, improving
  its overall capability to provide logistical
  solution. It launched an integrated logistic
  system covering 17 provinces and cities
  nationwide, initially completing the construction
  of a highly efficient end to end logistic system
  from storage, trunk routes and branch transport
  to the last kilometer delivery.
• Haier has started a new subsidiary to handle its
  logistics requirement for supply of large
  appliances and ensure proper integration of
  online and offline sales. In 2015, self-built
  warehouses were constructed adding up to a total
  of self built warehouses.

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• The operations in 3rd and 4th tier cities were
  still in development phase and need excellent
  logistics network to fully integrate these areas
  to the main system. HUB coverage was expanded to
  further enhance the delivery speed to villages
  and to doors in 3rd and 4th tier markets.
• Other major companies manage their logistics
  through parties depending on their needs and
  region they target. Many companies include
  logistics cost as part of their operations.
  Companies also maintain good relationship with
  large retailers to tap the tier1 and tier2
  cities. In tier3 and tier4 cities they rely on
  flagship stores, exclusive shops, and other
  traditional and nontraditional methods for
  effective delivery of products to the consumer.
• Key Factors Considered in the Report
• Comprehensive analysis of China Large Appliances
  Market and its segments
• Listed major players and their positioning in the
  market
• Identified major industry developments in last
  few years and assessed the future growth of the
  industry
• Large Appliances Market of China with their
  Products

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to below link https//www.kenresearch.com/consume
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