Inspect Your Gadgets

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Inspect Your Gadgets

By Barbara Sax - 06/06/2015

Consumers have long purchased housewares in the supermarket channel. In fact, the channel ranks fourth in total housewares category sales, according to data from the International Housewares Association (IHA).

“Every other retail channel is experimenting with food, so why shouldn’t supermarkets embrace other categories?” asks Perry Reynolds, VP of global trade development at Rosemont, Ill.-based IHA. “There’s tremendous opportunity in housewares, not only from a sales, but [also] from a gross margin, point of view. These products are exactly the kind of products a consumer would be willing to purchase at their grocery store.”

Supermarkets accounted for 9.3 percent of total housewares sales in 2013 (the most recent IHA data), up from 8.5 percent in 2012. Total housewares sales at the supermarket channel came to $6.1 billion in 2013, according to IHA, with Kroger, Safeway, Publix, Ahold and H-E-B seeing the highest sales in the channel, and all chains showing increases in category sales over the previous year. This trend is expected to continue.

According to Reynolds, gross margin on housewares ranges up to 60 percent, a significant increase over traditional grocery items. “The gross margin on these products so far outpaces the rest of the store that it makes attention to the category mandatory for supermarket retailers,” he asserts. “The big chains have the resources to manage the category themselves, but even smaller chains who use a distributor to manage the category should be giving it more of their attention, because it can be a huge profit center with a variety of price points.”

Some chains are depending on manufacturers to provide them with an assortment that can meet a wide array of consumer needs. “We support retailers’ core categories, like bakeware, cookware and gadgets, with floorstands, counter units and end cap racks to maximize their sales potential,” says Bert Tanimoto, a spokesman for Barrington, Ill.-based housewares distributor Bradshaw International. “We are constantly offering special promotions and cross-merchandising. Bradshaw also has the ability to regionalize our fans and drive them to specific store locations with special promotions.”

Gadgets Galore

Safeway carries Bradshaw’s Good Cook branded products across its kitchen tool, bakeware and cookware categories. The chain also stocks Bradshaw’s Bonny line of bar tools in its wine/bar tool section, including a cocktail shaker, bottle opener and double jigger measure at some stores.

Wine tools is one of the fastest-growing segments in the housewares category, with aerators, wine preservation tools and bottle openers proving to be fast-turning, high-profit additions to any wine department. “The price of aerators has dropped, so supermarkets can offer their customers a great product beginning at about $15,” notes Reynolds. “Affordable tools are flooding the market, and the gross margin on these products is better than the gross margins on wine.” At one location in Washington, D.C., Safeway includes wine gift bags and wine tools from Metrokane’s Houdini and Rabbit brands.

Gadgets with portion-control features continue to be popular with consumers. “Portion control is a feature that has gained a lot of traction with consumers in the past five years,” affirms Jeff Logan, director of marketing for Coppell, Texas-based Dexas International. “Consumers are looking for easy, practical ways to help them manage their diets. Consumers also want fewer products that can serve more than one function, so when you can merchandise a colorful portion-control scoop near the cereal or pasta aisle, it’s a great way for supermarket retailers to generate add-on sales.”

Two of Dexas’ most successful portion-control products are the Collapsible Kitchen Klip Scoop, which retails for $6.99 and can be used as a portion-control measuring scoop as well as a clip to reseal bags, and the new Spoon & Strain Tongs, retailing for $9.99 and able to be used as a 2-tablespoon measure or as tongs.

Key items from New York-based Robinson Home Products, meanwhile, are Oneida baking tools and gadgets, and the new Oneida Mandolin Slicers. “Several new product introductions from Zing and Chip Clip offer a pop of color and add fun to the kitchen at a price point ideal for impulse purchases,” says John White, Robinson’s business director of housewares. “Color continues to top the trend charts, since consumers wish to add splashes of color and brightness to their kitchen palettes.”

White adds that while he hasn’t seen retailers adding more space to housewares, more clip strip programs and adjacencies are boosting category sales, and stores are fine-tuning their offerings to appeal to shoppers. “Retailers are being smarter about what products they merchandise,” he observes, “and catering to the interests and wants of their entire customer base.”

Bigger-ticket Items

In some cases, that means experimenting with higher price points. Logan notes that Dexas’ Turbo Fan Salad Spinner, which retails for $30, has experienced strong sales at supermarkets despite its higher price point. “Chains like Wegmans have been increasing the space they give to housewares, and we’re seeing price points inching up from an average of $4.99 to around $7.99 to $8.99,” he says. “Consumers are willing to spend more on products that help them save time with food prep and make it easier to serve healthier options.”

In some of its larger-format stores, Landover, Md.-based Giant devotes an 8-foot section in the housewares aisle to kitchen appliances with higher retail prices. The section includes a Keurig K-cup coffeemaker retailing for $119.99 and a Cuisinart Mini-Prep that costs nearly $40.

Culinary stars continue to have a big impact on the cookware and bakeware categories, two of the largest segments for the supermarket channel, according to IHA. “Celebrity chefs have heightened the profile of cookware and bakeware, and licensed housewares have been a big success,” says Reynolds. “A name like Mario Batali will sell anything.”

Bradshaw’s Tanimoto notes that his company has seen significant interest in products that carry food to a party, an outing or some other social event. “Baking tools for Saturday cookies, or produce helpers for summer picnics, for example, help our retailers to go beyond a sale, since the products are part of creating actual events,” he explains.

According to Reynolds, “As Seen on TV” household items are also an accelerated trend in the housewares category. “The products are a great addition for supermarkets, since they are pre-sold,” he says. “There’s tremendous awareness of the products in this category,” agrees Angelo Bianco, sales manager at Fairfield, N.J.-based Telebrands, which specializes in such items. “In the past three years, supermarkets have doubled their business in the category. Chains like H-E-B, Kroger and Weis are doing a great job with the category.”

Adjacencies and clip-strip programs are huge factors in the category. “Counter and flexible display units are an increasing trend. This could play out well for supermarkets in that they have the ability to merchandise the specific product near the food it is intended for,” asserts Bob Ludeman, EVP of global sales at Chef ‘n.

The Seattle-based company’s fruit and vegetable prep products have been particularly successful in the supermarket channel. “Fruit preparation tools, such our StemGem strawberry huller, have had strong sales at supermarkets,” observes Ludeman. Chef ‘n’s recent introductions include a mini juicer, a jalapeño/pepper corer set and a greens stripper.

Seasonal Items Heat Up

Warmer weather means more opportunities in the housewares category for supermarket retailers. From outdoor furniture and tableware to tiki torches and coolers, outdoor living is a big trend in the housewares market, and supermarket retailers should be on board.

“Outdoor cooking continues to be a positive growth category,” says IHA’s Reynolds. “Even supermarkets like Aldi that have a pretty basic selection are featuring outdoor fire pits and garden hoses in their seasonal sections.”

Giant’s seasonal outdoor offerings include barbecue tools and outdoor torches. The Ahold USA chain merchandises the products on floorstands near checkouts for maximum exposure.

Impulse sales can come from products as varied as unbreakable stemless wine glasses and gardening gloves, the latter of which “are an easy add-on purchase,” says Tim Stapleton, president of U.S. sales for Rome, Ga.-based Big Time Products. “After batteries, gloves generate the highest percent of impulse sales in housewares, and they offer 50-point margins.” He notes that Big Time gardening gloves, which retail for between $9.99 and $12.99, have quick sell-through on power wings and floorstands in the seasonal department.

Gardening tools are a key component of seasonal sales. Telebrands recently introduced the Pocket Hose Top Brass, an improved version of the company’s popular Pocket Hose. Three times stronger than the original product, the new hose features tightly sealed connectors and an accordion design to automatically expand when water is turned on. The lightweight, easy-to-store, kink- and tangle-resistant item comes in 50-, 75- and 100-foot models, with a starting retail price of $29.99.

“Every other retail channel is experimenting with food, so why shouldn’t supermarkets embrace other categories?”
—Perry Reynolds, International Housewares Association

“Retailers are being smarter about what products they merchandise, and catering to the interests and wants of their entire customer base.”
—John White, Robinson Home Products