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Hardware trade needs impetus

Chances of success for the German hardware trade will only emerge when the economic situation of the building industry improves

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The hardware trade consists of two separate parts that are increasingly distancing themselves from each other. On the one hand is the retail trade, and on the other the industrial suppliers.
According to information from the Central Association of Hardware Dealers (ZHH) in Düsseldorf, there was confidence within the hardware and housewares retail segment at the beginning of the year 2001 that it would be possible to profit from the slight increase in spending power and to hold sales at the level of the year 2000. After the first four months this forecast turned out to be erroneous. The mood of consumers virtually broke down; sales went down month by month. The uncertainty deepened still more after 11 September, although no significant damage can be established on that day from the data that is so far available. The mood was already negative beforehand and then clouded over still further.
Future prospects have not improved from the viewpoint of consumers. This development is disguised by the shift in sales potential, a phenomenon that has already been outlined in the past, away from the specialist trade and over to DIY superstores, hypermarkets and furniture stores.
DIY superstores are continuing to reduce the sales po-tential of the hardware retailers.
The IfH, or Institute for Commercial Research at the University of Cologne, established an effective decline of 4.5 per cent for the hardware and housewares trade for the year 2001 including September. This trend continued to worsen in the course of the year 2001, so that no improvement is to be expected before the end of the year at least. Nor is there any evidence that the start in the new year would provide any better conditions than in the previous year. The ZHH fears that the mood of consumers is unlikely to improve substantially so long as the general economic situation fails to improve, the building industry fails to get a footing and the labour market fails to send any positive signals.
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