Juicers at crossroads

Abstract:
Juice extractors are a small category in the US electric kitchen appliance business, and there are approximately only half a dozen brand names which are recognized. Unit sales of juice extractors are usually low, although the profit margins are excellent. Retail sales of juice extractors in 1996 were at $123 mil. and were at 70% the sales peak in the early 1990s. Braun and Hamilton-Beach are two of the better known brands in the category.

Full Text:
NEW YORK — Compared to other kitchen electrics, juice extractors generate a small amount of business in the U.S. And there are only about half a dozen recognized brands in the category.

However, these brands come from heavy-hitting suppliers such as Braun, Hamilton Beach/ Proctor-Silex, Salton/Maxim, Sunbeam-Oster and Waring, and consumer interest appears to be growing “The continuing health craze means that juice extractors are a popular kitchen appliance with a loyal following, which continues to grow,” reported Kim Ellwein, product manager for Oster appliances at Sunbeam Corp. “It’s the health-conscious consumer we target with our Oster juice extractor.”.

Ellwein added that, compared with other product lines in the Sunbeam-Oster stable, juice extractors don’t rank high in unit sales. “But the margins are excellent,” she said.

Industry sources estimate the juice-extractor business at $123 million at retail in 1996. Sales reported for 1996 represent a market about 70 percent lower than what it was when it peaked in the early 1990s, however.

At that time, according to one retailer, the juice extractor business exploded, mainly because of the launch of infomercials for the Juiceman juice extractor, now manufactured by Salton/Maxim.

“After Juiceman went retail, many more players entered the business,” he said. “In 1995 and 1996, the business saw some shakeout, and now only the strongest suppliers remain.”.

But the juice extractor business today is significantly ahead of where it was two years ago, according to Doug Frazier, director of consumer sales at Waring. He said the retail marketplace flushed through the deluge of products that were on the market five years ago.

“The market continues to get stronger, and we’ve noticed a significant amount of activity at the high end,” he said.

Juice extractor sales at Waring Products in 1996 were up 18 percent over 1995, according to Larry Casalino, product manager over juicer products. “And we expect them to increase an additional 10 percent in 1997,” he said.

Frazier said Waring expected good, steady growth in the category. “I doubt we’ll see any more dramatic surges in the business,” he added.

“And ultimately, the category will reach a more mature stage and the sales increases we’re noticing now will probably level off a bit.”.

Waring has been making juice extractors under its own brand name for about 20 years, and bought the Acme name and tooling about 11 years ago. Waring juice extractors target both the commercial and consumer markets, while Acme juice extractors mostly target the commercial market.

“We’re in the process of expanding the SKU count of Waring juice extractors, and will introduce products in a variety of new colors at the Gourmet Show,” Frazier said.

Hamilton Beach/Proctor Silex introduced a 200-watt juice extractor last summer, but increasing consumer demand for more powerful motors led the company to upgrade the motor to 300 watts. The more powerful unit was introduced in January.

“More power is what consumers are looking for,” said Dave Kerr, senior product manager at Hamilton Beach/Proctor-Silex. “And from a competitive standpoint, we wanted to move up.”.

Sales of Hamilton Beach juice extractors doubled between 1995 and 1996. “This was not off of a huge sales base,” Kerr explained, “but represents significant growth just the same.” He added that further, double-digit growth was expected for 1997.

Ellwein at Sunbeam said increasing awareness of the category means consumers generally have an idea of what they want before entering stores. “Juice extractors are absolutely a destination purchase,” she said.

She added that features driving sales include a powerful motor, large juice capacity, continual feed capability, and dishwasher-safe components for easy cleanup.

“Consumer awareness is very high,” according to a merchandise manager for a Northwest-based department store chain. “The Juiceman infomercials still run all the time and pull along the whole category,” he added.

Retailers report that the feedback they receive from consumers puts performance at the top of the list of key features. One explained that performance is the primary consideration of consumers in the market for juice extractors, and that price was secondary.

“Consumers are looking for a powerful motor, and they want to get maximum yield in terms of juice from produce,” he said.

The value of features such as power and easy cleanup has been recognized by most players in the business. Other features have been introduced as well.

Braun’s MP80 juice extractor can eject pulp automatically, a feature designed especially for continuous processing of large quantities.

The detachable, swing-out pulp container was designed to make cleanup easier.

Braun also puts in a pulp strainer for increased extraction from fruits with high liquid content, a stainless-steel strainer basket, a beaker designed for easy separation of foam from juice, and a double safety locking lid.

Although price may be a secondary consideration, it is still an important one. “While there is a big difference in features at different price point levels, there is also quite a bit of opportunity at each price-point level,” noted the merchandise manager from the Northwest-based department store chain.

“If you don’t have all price point levels represented in your assortment, you’re going to miss out on a lot of business.”.

He went on to say that the most unit sales occur at the opening price point. “Dollar volume is highest at the middle range of price points,” he added. “And margins are best at the high end.”.

When the market peaked in five years ago, entry-level price points dipped as low as $20. Following the shakeout among participants in the category, though, the price-point range tightened somewhat.

The Hamilton Beach juice extractor has a suggested retail price of $54.99. Oster’s juice extractor fetches a suggested retail price of $69.99.

Braun’s model is in the same range, with a suggested retail of $79.99. Waring sticks to the high-end business, with its PJE10 model at a suggested retail price of $288 and the PJE40 at a suggested retail of $380. The PJE10 has a plastic body, while the PJE40 has a stainless steel body.

Making juice is labor intensive, said Waring’s Casalino. “Juice extractors really only appeal to consumers who are serious about juice,” he said. This consumer group, however, is growing.

Interest in health and fitness continues to develop, he related, and in that area proper nutrition is the name of the game. “We market our juice extractors toward consumers who are interested in alternatives to vitamin supplements, which include fresh juice,” he said.

“Consumers are introduced to the category by specialty retailers such as health food and gourmet stores,” Casalino continued. “Also, there are more juice bars in business, many of which operate in health and fitness clubs.”.

Kerr at Hamilton Beach also pointed out the flourishing juice-bar industry as an effective means of expanding the market. “Juice extractors appeal to an increasingly broad consumer base,” he said.

“We’re still talking about the health conscious, but the market is no longer confined to the specialty health-food niche.”.

Juicers at crossroads
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