The AHMA / USA Pavilion Opens

Participants prepare to cut the ribbon to officially open the AHMA / USA Pavilion at the International Hardware Fair Cologne on Sunday morning, February 28, 2010

Participating exhibitors include A & E Hand Tools, DMT Diamond Machining Technology, Dumond Chemicals, Inc., General Pipe Cleaners, Div. of General Wire Spring Co., Genova Products, Inc., H.D. Hudson Asia LTD, Klein Tools, Inc., LA-CO Industries, Malco Products, Inc., McKim Group, Midwest Tool and Cutlery Co. – Midwest Snips, Peli Products, Phifer Incorporated, Pinnacle Products International, Inc., Plews/Edelmann, Red Devil Inc., Roebic International, Inc., Seymour of Sycamore, Inc., Shop-Vac Corporation, Stack-On Products, Thermwell Products Co., Inc., U.S. Commercial Service, Valley View Industries and Zephyr Manufacturing Co., Inc.

German DIY/Home Improvement Store Sales Up, Declines in the Tool Industry

As the fair opens, sector associations participating at the International Hardware Fair have revealed different sets of results for the past year. While the German tool industry is registering declines, the DIY/home improvement stores are reporting a slight sales increase for 2009. The associations are hoping that the International Hardware Fair from 28th February to 3rd March 2010 in Cologne, which is expected to attract around 2,700 suppliers and their innovations from 51 countries, will generate sales increases for 2010. The forecasts for the coming months are cautiously optimistic.

As the German Tool Manufacturers Association (Fachverband Werkzeugindustrie - FWI) established for its members, compared to the previous year, sales achieved by its companies declined by around 25 percent. In the first half of the year the decline had however even been as high as 31 percent, so that the FWI was able to confirm a slight improvement in the last months of the year. Europe continues to be the most important sales market for the German tool industry: 60 percent of total imports went to EU member countries, followed by the USA at 7 percent and Asia at 14 percent. There is a clearly more optimistic mood among the DIY/home improvement store operators, according to information from the Federal Association of German DIY Stores and Garden Centres (Bundesverband Deutscher Heimwerker-, Bau- und Gartenfachmärkte - BHB). The third and fourth quarters of 2009 in particular were successful. The losses from the first quarter were offset by rising gross sales from July onwards. For 2009 overall the BHB is expecting a sales increase in like-for-like terms of 0.5 percent. Following declines in 2008, the DIY/home improvement stores thus clearly increased their sales once again. In December alone, customers in a buying mood ensured a sales increase of around 3 percent (like-for-like value), as revealed by a current member survey conducted by the association. All the product groups in the do-it-yourself trade were able to recently benefit from the strong demand, especially for products required for simple renovation projects, and in addition, in recent weeks, particularly for heating material and winter articles. Apparently customers are not saving on product quality either: quality articles continue to be in demand. The BHB has expressed confidence for the current year, it stated there are many indications that sales will stabilize at least at the level of 2009.

The German Federation of DIY Manufacturers (Herstellervereinigung BAU+DIY) estimates the total market volume of classic DIY/home improvement store and garden centre articles in Germany at around 43 billion Euro. The manufacturers’ association with its 130 member firms has asserted itself well in the crisis year of 2009: on a national level sales experienced a provisional decline of only 1 percent, internationally minus 3 percent. As a result, the sector only just failed to reach the previous year’s level. Similar to the BHB, the Central Association of the Hardware Trade (Zentralverband Hartwarenhandel – ZHH) has also established increased demand for brand and quality products in its results for the year. It also registered a stable trend in 2009 for the hardware and hardware retail trade in the current business year. In 2009 the hardware trade overall registered a sales increase estimated at 0.5 percent. In particular there were sales increases in the tools, security technology/equipment and housewares segments. According to the ZHH, in contrast to the hardware retail trade, the tool and construction fittings B2B business, which serves commercial end-customers, is clearly suffering from the consequences of the economic crisis. While in the construction fittings sector the economic trend in 2009 was not so strongly in decline as in other B2B segments, the tool B2B was completely affected by the crisis in 2009. As of the third quarter the estimation of the current sector situation has however slightly improved, there are indications of stabilization, so that for the year as a whole the ZHH expects a decline for the tool B2B of 10.9 percent for 2009 and predicts an overall decline of 2.5 percent for the construction fittings sector.