Executive Summary

The UK brown goods market has undergone a difficult period during the recession, with sluggish sales and upheaval in the electrical retailing sector. Despite this, in 1995 the brown goods market in the UK was worth £2.86bn at retail selling prices (rsp), an increase of 2.7% on 1994. In terms of unit sales, the market reached 16.6 million units, an increase of 2.2% on 1994.

The UK consumer electronics, or brown goods market covers home entertainment products such as televisions, video cassette recorders (VCRs), camcorders, satellite systems, audio systems, portable audio and audio separates. It does not include home computers, in-car audio equipment or audio and video software.

The slow rate of economic recovery has not helped the brown goods market, but there have been signs in the last couple of years that sales are recovering and most sectors, especially audio systems, portable audio and large-screen televisions, are now showing strong growth.

Household penetration is high in markets such as televisions and VCRs, and so new product development (NPD) tends to drive the market, with consumers more likely to upgrade a VCR or television, for example, than a kitchen appliance.

The brown goods market is closely linked with the television and radio broadcasting companies, with innovations developed by these companies helping to change the products offered by brown goods suppliers. For example, NICAM stereo was developed by the BBC and Independent Television.

The brown goods market is an international one, with the UK market dominated by a few multinationals, such as Sony, Philips and Panasonic. There are very few UK-based manufacturers except in the audio separates and satellite receivers market.

In terms of distribution, the brown goods market is very much dominated by the electrical multiples, such as Dixons, Currys and Comet, with smaller independents important in sectors such as audio separates, where more specialist advice is sought by the consumer.

In terms of the future, the brown goods market is expected to show steady growth over the next 5 years, with overall growth of 25.6% by value up to the year 2000. Between 1996 and 2000, the market is forecast to grow to £3.79bn.

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