If you have $6300 burning a hole in your pocket then there's no need to read this blog post.
Yeah, I didn't think so – I don't have it either. If I did, I would buy a copy of the Freedonia Group's study of the world power tool market, which contains current sales data, sales projections for 2016 and 2021, and a who's who of manufacturers. For the tool companies that buy it, the $6300 report is just one more way to keep an eye on the competition.
I wish I could tell you exactly what is contained in the report, but I have only seen the introduction. And if I had the whole thing, and showed it to you, I'd have to kill you after (Actually, the Freedonia Group would kill me or have their lawyers do something even worse because when you purchase the report you must sign an agreement not to share it).
Here are some tidbits from the report's introduction plus some comments of my own:
- In 2011 the worldwide market for power tools was worth $22.5 billion. In 2016 it is expected to be worth $28.1 billion. Of that amount, 31% will be sold in North America, 27% in Asia/Pacific, 26% in Western Europe, and 16% elsewhere. (That so many power tools are sold outside of North America explains why new models are frequently introduced first in other parts of the world.)
- The greatest gains in power tool sales are expected to occur in developing countries in Asia (India being the most notable). China is expected to overtake Japan as the second largest market behind the U.S.
- Technological advances in batteries, motors, and charging have allowed cordless tools to overcome their historical price and performance disadvantages (In plain English: cordless tools are getting so good people are buying them instead of corded models. No surprise there.)
- Electric power tools account for the majority of all power tool demand and are used by pros and consumers. Pneumatic tools are used almost exclusively by pros and the demand for them is being driven by rising motor vehicle production and construction spending.
- Pro demand accounts for approximately 70% of global power tool sales.
- China is the world's largest net exporter of power tools; 3/4 of the tools produced in that country are exported. (The big power tool companies are happy to produce in China but would like to sell there too because it's a relatively untapped market. In many cases, the models they offer in Asia are simpler and less expensive than the ones they sell in North America and Western Europe.)
- Labor is cheap in Asia (no surprise there) and this limits the power tool companies' ability to sell to the DIY market there. With labor so cheap, middle-class Chinese people tend to hire work out instead of doing it themselves so the DIY market is small(This tendency caused Home Depot to close the last of its stores in China in 2012 and is negatively affecting the companies that continue to operate big box stores in that country.)