“The shift towards consumer sales has been dramatic and sudden”, said Antonio Talia Head of Business Analysts at CONTEXT. “Now, with lockdowns easing, distributors should be prepared for the market to move in the opposite direction.”
Overall volumes held steady year-on-year, although results varied by country. There were marked declines in revenue, mirroring falling business sales. Revenues fell by -40.1% in France and by -27.2% in the UK. Revenues in Spain and Italy fell by -6.9% and -5.7% respectively. The revenue split in May this year was 58.9% business to 41.1% consumer, compared to 73.1% business and 26.9% consumer in May last year (there are 2 more working days last year compared to this year). In normal times, revenue figures favour the business sector because of the fewer, bigger investments that businesses make. This hit to the business share will gradually reverse once business demand is back, and once excess stock has moved through to final customers.
Sales to consumer channels held steady, and sales to business channels fell. Unit sales to corporate resellers dropped by -39.4% year-on-year, and sales to etailers focused on serving businesses were down -28%. Sales to consumer channels were up by +2.2% for retail chains and +11.2% for consumer etailers, as lockdown working encouraged consumers online to refresh home equipment. In this consumer-driven market, inkjet MFPs did well; the coronavirus lockdowns challenged other categories, particularly sales of business laser devices. The changes are likely to have generated an excess of inventory in the channel, and we may see promotions as more normal activity restarts.
“Although the situation varies by country, the trends over the last couple of months are clear: consumer inkjet MFPs are performing well, business spending is down, and the market has shifted towards consumer printers. As offices begin to reopen, distributors should be anticipating a rebound in business sales in the second half of the year”, Antonio added.