The COVID-19 pandemic has become a double-edged sword for appliance retailers. (Photo 175094423 © Antoniodiaz | Dreamstime.com)

By Teena Monteleone

Supply and Demand

Local appliance retailers seeing high demand due to pandemic

Dec 21, 2020 | 5:00 PM

While many businesses have been struggling during the COVID-19 pandemic, appliance stores everywhere are seeing numbers soar. But that high demand is creating a problem for manufacturers and longer wait times for consumers.

The owner of Leon’s store in Prince Albert, Dean Pellegrini, said they were fortunate the home appliance and furniture industry had a surge in business due to higher demand for products as more people were forced to stay home.

“In the beginning, there was panic buying, so people filled their fridges and freezers to capacity,” Pellegrini said. “More people are eating at home, using the furniture, spending more nights in bed may have exposed problems for consumers they didn’t want to live with anymore. The first essential need is the refrigerator and freezer, then came the washers and dryers. These items were hardest hit and almost ten months since the start [of the pandemic] and it is still a challenge to fill orders.”

Another furniture and appliance store owner agreed, saying consumer demand has never been so high. Marty Houle of Houle Furniture, also based in Prince Albert, said it created many challenges with appliance availability.

“More common or popular products sometimes tend to be a month or two away. But more specialty products, which are huge in demand today because of all the renovations and building going on, are in some cases, up to six months away,” Houle said.

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The current supply and demand issues in the appliance industry are similar to what was seen in the summer when lumber demand went through the roof and the soft drink industry saw an aluminum can shortage, according to the Dean of the Edwards School of Business at the University of Saskatchewan.

Keith Willoughby said manufacturers, primarily located in the United States and Mexico are experiencing challenges with their factories and manufacturing outlets trying to instill COVID-19 protocols.

“So, they’re experiencing a reduction in their capacity. Meanwhile, you’ve got a lot of customers like us here in Canada looking to spend our dollars and now we’re considering purchasing appliances,” Willoughby said. “So that supply and demand is creating a real challenge.”

Unfortunately, Willoughby said it’s not something that will be solved overnight, so consumers just need to be patient.

“Carrying inventory is expensive, so manufacturers will be cautious about how they build up their capacity at this time,” he said.

While he doesn’t think consumers will see an increase in the price of high demand products, Willoughby said one impact may be having to accept more standardization.

“There’s a huge variety of different styles or models or finishes…so in an industry like appliances where you have that huge assortment of customization, that’s causing manufacturers to dial back and maybe they can’t focus on delivering all the customizations they had earlier so now we’re getting fewer options available,” Willoughby explained.

The Leon’s store has a large onsite warehouse in Prince Albert, so Pellegrini said he generally has a backup stock of items consumers see on the floor. But he said there are a limited number of manufacturers supplying stores that sell appliances in Canada and the USA and they all rely on other suppliers building certain components.

“If that supplier is having trouble, it magnifies down the chain,” Pellegrini said.

“With some manufacturers who have a broad selection and three or four name brands under one roof, it quickly became very difficult to keep up with demand. So, some models or colours are not getting produced to make way for the more popular items needed. Unfortunately, its taking quite some time to catch up to the huge demand on these suppliers.”

Still, business is solid. Nationally, Leon’s Furniture Limited announced record financial results for the third quarter of 2020 and Houle says he’s found new customers because of the pandemic.

“The pandemic has created the need for customers to look around,” Houle said. “I may lose regular customers who have to go wherever they can get the item first. But maybe, in some cases, I can get the item sooner so its also opened up opportunity to get new clients. It’s a very level playing field.”

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teena.monteleone@jpbg.ca

On Twitter: @MonteleoneTeena