Now that the kids are back at school powering up their new laptops and tablets, electronics companies are crossing their fingers and hoping for that bright shopping light to shine at the end of the year.
The Christmas countdown has begun, and all sorts of trend counters are trying to figure out how many new phones, tablets, computers, appliances, TVs, and pick-your-gadget-of-the-year will be unwrapped in a few months.
ShopperTrak, a research firm that analyzes retailer foot traffic, anticipates decent growth for the coming Christmas shopping season -- except for electronics. On the upside, overall national retail sales in November and December should rise 3.3 percent from the same period last year. The downside: In the electronics and appliance sector, foot traffic should drop 8 percent, though sales should increase 1.5 percent.
Bill Martin, ShopperTrak's founder, said in a press release:
Some of the traffic decline in the electronics and appliance category can be attributed to consumers going online to research premium-priced purchases or to purchase items at discounted prices. You can't, however, ignore the fact that 92 percent of total GAFO [general merchandise, apparel and accessories, furniture, and other] retail sales still occur in brick-and-mortar stores. Retailers who align their in-store and online strategies to provide multiple touch points and distinct value offerings for consumers will come out on top.
OK, so that's a glimmer of hope. Christmas may not be a washout. Still, it has been a depressing economic year by and large for many high-tech firms, and other headlines give me a tempered view going into the last quarter of 2012.
Royal Philips Electronics N.V. (NYSE: PHG; Amsterdam: PHI) , a European bellwether, is going through a multi-year restructuring to cut costs. Last week, it said it will have to cut another 2,200 jobs to save an extra 300 million ($389.5 million) as economic conditions deteriorate further. These cuts, in addition to the 4,500 announced previously, "bring the cost-cutting target to 1.1 billion euros by 2014," according to Bloomberg Businessweek.
Also, exports from Singapore, a key Asian supply chain hub and the place where many high-tech companies run their logistics operations, dropped more than economists anticipated in August. The primary reasons cited were lower European demand and weakness in China.
Looking at these numbers, maybe it's not a surprise that this year's IFA, a tradeshow for consumer electronics and home appliances in Berlin, broke records. From the end of August to early September, 1,439 exhibitors presented product debuts to 240,000 attendees (up 1 percent from last year).
Maybe with the broader market uncertainty, hitting the showroom floor and scouring for deals among colleagues isn't such a bad idea.
Re: "it said it will have to cut another 2,200 jobs to save an extra 300 million ($389.5 million) as economic conditions deteriorate further" hash.era2/16/2013 10:24:21 PM
Except for Amazon, those things happen every year, no?
I also believe Amazon is in for a big year. They are not doing bad, but I think they will continue to sell a ton of tablets. I don't think Google had the same impact with the Nexus 7, even if its a more complete tablet.
Those 2, with Apple, have the option to leave a small margin in the tablet market (making the actual $ with the apps). Samsung and others can't afford that.
Re: "it said it will have to cut another 2,200 jobs to save an extra 300 million ($389.5 million) as economic conditions deteriorate further" Jennifer Baljko9/27/2012 6:21:51 AM
Roques - I agree. I don't know if this company tracks when people buy, but I imagine there are a decent number of shoppers who buy gifts in a more phased, economically sane approach, spreading their spending over five or six months and use sales and online coupons to their advantage. But that's probably just a small number of people...
Barbara - I think you said it best... and -- minus the Amazon acquisition prediction -- sounds like patterns we seen in the last few years. Point being - the more things change, the more they stay the same.
Re: "it said it will have to cut another 2,200 jobs to save an extra 300 million ($389.5 million) as economic conditions deteriorate further" Mr. Roques9/26/2012 5:17:02 PM
Is that company also tracking how early are people buying gifts? I would expect most people wait for Black Thursday and all other super sale days... and with electronics, sometimes the more you wait, the better (I wouldnt expect many people to buy tablets right now, they probably wait for the iPad Mini ... if they are looking for that 200 - 250 price range).
i do not know/see how the growth will happen only after elections. As the article suggest the weakness in market is mainly due to EU and China. So, USA elections seems to have very limited impact. The market is recovering well but the EU is pulling down the seemigly good recovery.
Re: "it said it will have to cut another 2,200 jobs to save an extra 300 million ($389.5 million) as economic conditions deteriorate further" Rich Krajewski9/25/2012 3:33:20 PM
"And from recent announcement from logistics companies like UPS and FedEx, it's more realistic to expect and be grateful for a warm hug in December than an expensive gift."
Not surprised if UPS and FedEx data stays flat for awhile (unless it gets a boost from people not wanting to travel to shop). Concerning personal economizing, I made my wife some candy for her birthday out of natural peanut butter, honey, and dry milk. Topped that off with a public domain, electronic copy of a book about a Roman general (she loves history). The warm hug sounds pretty good. I'll tell her you said I should give her one.
Here's my analysis: "Foot" traffic will be limited to the crazies that line up in front of Wal-Mart on Thanksgiving night that are willing to crush fellow humans in the rush for an HDTV. Job growth will be limited to seasonal workers: the extra folks that UPS/FedEx/DHL hire; hapless security people for Black Friday crowd control; and retail clerks that will be idle up to Christmas Eve. Amazon.com will have a blow-out year; acquire NetFlix; and show Wal-Mart and Target the error of their ways when they stopped selling the Kindle.
Re: "it said it will have to cut another 2,200 jobs to save an extra 300 million ($389.5 million) as economic conditions deteriorate further" Bolaji Ojo9/25/2012 8:03:17 AM
Rich, The signs are there for all to see. Corporations are tightening spending again, consumers are still concerned about job growth and with inflation still low and wages under tight control, it's unlikely sales will be strong in the December period. I am not even thinking of "gifts" right now at a personal level. And from recent announcement from logistics companies like UPS and FedEx, it's more realistic to expect and be grateful for a warm hug in December than an expensive gift.
Re: "it said it will have to cut another 2,200 jobs to save an extra 300 million ($389.5 million) as economic conditions deteriorate further" Bolaji Ojo9/25/2012 8:03:16 AM
Rich, The signs are there for all to see. Corporations are tightening spending again, consumers are still concerned about job growth and with inflation still low and wages under tight control, it's unlikely sales will be strong in the December period. I am not even thinking of "gifts" right now at a personal level. And from recent announcement from logistics companies like UPS and FedEx, it's more realistic to expect and be grateful for a warm hug in December than an expensive gift.
A new report shows that most of the worrisome issues that the supply chain industry has been dealing with for years are not new, but there are some new concerns that need answers. Heres a look at what keeps supply chain professionals up at night.
When it comes to shipping supplies from China to Europe, trains might be the most cost-effective way companies have available to them. DHL is looking to jump on that bandwagon.
For many dealing with the enormous task of tracking,
reporting, and resolving issues associated with
potential counterfeit parts, there is a collective
hope that 2013 will bring clearer guidance on what
needs to be done by whom and when.
A necessary foundation for moving efficiently at real-time speed, supply chain analytics is still very much at the beginning stages of development at many companies.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronicswith a lean supply chain and just-in-time demandsthe need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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