Vacuum Cleaners Discussions

Dyson has this week released details of their end of year 2009 performance and generally paints a positive picture. Highlights include:-

• Despite the recession, global sales for the company increased 23% to 770m GBP
• Operating profits more than doubled from 90m to 190m GBP
• The Dyson Air Multiplier is a top seller in Australia; within 6 weeks, representing 64% of the market for desk fans, by value.
• In the UK and US markets, the updated 'ball' range represents more than half of the Dyson cleaners sold.
• In the UK, the company has a total market share for vacuum cleaners, by value, of 40%.
• Dyson is the market leader for vacuum cleaner sales (by value) in the UK, US, Canada, Australia, France, Belgium, Spain, Switzerland, Ireland and New Zealand.

Looking ahead, the company talks about new product launches scheduled towards the end of 2010 - a fair number of which (my speculation) are likely to continue the trend of offering a completive advantage by using digital motor technology. Ironically, a technology originally developed for use in their full-size vacuums, while all current models continue to use traditional motors.

http://www.independent.co.uk/news/business/news/dyson-profits-double-thanks-to-rd-investment-1983841.html

http://www.themanufacturer.com/uk/content/10603/Dyson_cleans_up

http://www.managementtoday.co.uk/channel/Entrepreneurship/news/1006022/sales-vacuum-dyson-gadgets-cost-worth-paying/

http://www.eurekamagazine.co.uk/article/25296/Dyson-doubles-operating-profits.aspx - note: this has the statement 'The company has also confirmed plans to launch a robotic version of its bagless vacuum cleaner' - dunno if that's significant, but I haven't seen it reported elsewhere.

DysonInventsBig wrote:

I have indeed  - it was written up here:-
http://www.thesun.co.uk/sol/homepage/news/2991620/Dyson-fan-vid-is-a-YouTube-hit.html

As of writing, 282,438 views within 6 days on YouTube - impresive. At 01:20 you can see that something in the lab on the left-hand side, that has been pixelated out

So, they got the engineers to play around for a few days, filmed the result and achieved reach that might have cost a good million dollars by traditional means.

It's 'just a fan' but seemingly a fan you can generate a fair amount of public interest in. Strange world.

Oreck and Bissell both increased their share of the vacuum market in 2009, due in large measure to advertising.

Thanks M00seUK for responding much as I would expect you to.  You never let me down.

I'm not sure I've responded every 6 months on dysons faltering sales in the US save to say that the insiders I know at the BEST BUY store that sells the most dyson product on the east coast since it launched in the spring of 2002 keeps me posted on the latest with dyson's sales.  They have been declining year over year at his store since the last quarter of 2006 giving up ground to all the competition both bagged and bagless.

BTW, my thoughts on the early release of dyson financial results are slightly differnt than yours.  Is there is a big retail deal going down soon maybe the biggest to come the UK way in years?  Does Sir James Dyson have an ulterior motive for patting himself on the back early and often now in contrast to years past when he filed yearly results 10 months after the close of the year?

Or perhap a more ominous reason? 

Carmine D. 

retardturtle1 wrote:
Retardturtle,

Thank you.  Did I read somewhere on here where you spoke of a pre-production Oreck Bagless?  Do you know what method is used to filter the fine dust?

Dyson Invents Big

"BTW, how many fans are sold in Australia starting in October for the next 6 weeks?  It's June now.  Who cares what the sales are in the autumn into winter season.  Like marketing fans in the USA in March.  It's still winter.  Fans don't sell in the USA until summer season unless they are a novelty and the rich with more money than sense just have to be the first to get one.  Tell us what the dyson fan sales are at the end of the summer season compared with the competition.  Then, I'm all ears."  [Carmine D wrote]

"I don't fully understand all your points here - your question needs a little rephrasing.
As I recall, the Dyson fan originally went on sale October 2009, which was the start of the summer season in Australia. In the UK market, I'd agree they they're more of a novelty, a status-symbol item, than representing fantastic value for money. But it hasn't stopped the likes of Bugatti from having a viable business in a similar low unit, high margin vain." [M00seuk wrote]

Hello M00seUK:

Recall is a funny thing isn't it?  Like editorial liberty.  With words you can say and mean anything you want.  But according to facts, October is no more the start of summer in Australia than March is the start of summer for the USA, the months dyson fans apparently are reported by dyson to sell so well in these countries.  Of course, it depends on what you mean by start.........

For clarification: Like all countries in the southern hemisphere (the hemisphere south of the Equator), Australia's seasons follow the sequence:

• Summer: December to February
• Autumn: March to May
• Winter: June to August
• Spring: September to November

Carmine D.

CarmineD wrote:
You're referering to the Carphone Warehouse / Best Buy US joint venture 'Best Buy Europe' which is rolling out in the UK at the moment? As a consumer, I look forward to the prospect, as up until this move there's been very little real competition in the market.

As a key supplier, it is doubtlessly a discussion point for people at Dyson. In the UK particularly, the out-of-town retail store is where most people buy vacuums and Dyson often pay big money to secure premium space in these locations.

If it will effect Dyson's margins / selling price is to be seen. Long-term Best Buy require Dyson sales to be successful and vice versa - so long as the products are seen to be in demand. 350 new R&D positions and a rumoured modular kitchenware appliance line would certainly help in this regard.

That's not the one I was referring to [tho that's a good reason].  Isn't Wal*Mart [in UK Asda] expected to buy a host of retailer neighborhood stores and expand big time into the UK retail market?  The strategy goes against the grain that out-of-town super stores make up most of the British business.  193 small central store locations in the UK mirrors the same retail market strategy W*M has been following in the USA. 

BTW, what's the weather like there?  Here in the USA, the Memorial Day weekend is the unofficial start of summer even tho on the lunar calendar summer doesn't officially start until June 20.  100 degrees here in Las Vegas [that would be fahrenheit degrees not celsius don't want to confuse our readers across the pond].

Carmine D. 

I haven't heard a great personally on the topic, but Wal*Mart could well be planning a shake up the market. In the last 10 years their ownership under the Asda brand has been steady, if not overly spectacular. Tesco still provides formidable competition in the sector. There's been 25 large format 'Supercentres' stores built, which have livery under the Asda / Wal*Mart brand. The company's compulsory use of the Asda brand ends soon and I think it's highly likely they'll re-brand all the stores as Wal*Mart.

I guess you're referring to the recent Asda takeover in the UK of 193 small format Danish-owned 'Netto' stores? I don't think anyone knows what might be earmarked for these locations, but it's feasible that some might specialise in electrical appliance sales.

A lot of people these days do research and get recommendations on purchases via the internet. I personally don't visit out-of-town electrical retailers to get good advice - you typically won't get it. I used to work in a specialist, non-electrical out-of-town retailer. I was keen and put a number of years in to the job, but still my knowledge was patchy in many product areas.

Although the Best Buy stores are promising to improve customer service, when I go to a store, I want the opportunity to play / measure the product and take it home the same day. There's a lot of potential for a retailer the offers this service, without the frills, with a price that's comparable to on-line sales.

If they're used as local grocery stores, they could find a place in the market. I haven't driven a car in a number of years, due to a vision problem and I'm frequently dismayed at how a lot of sociality these days is built around everyone owning a car.

Weather is fairly changeable at the moment. Quite warm on Sunday - but with the rain today, no requirement for a bladeless desk fan ;-)

That's the one. 

Tesco PLC has about 30 percent of the UK retail market and is the leader.  Asda [Wal*Mart] holds 17 percent before the purchase of Netto [Wales].   In the UK Asda trails rivals Tesco and J. Sainsbury PLC in expanding into new smaller store formats. In recent years these retailers have opened scores of small markets and convenience stores in town centers and busy residential areas to benefit from a broad change in shopping habits: Shoppers many of themaging or living in small households prefer to shop frequently and conveniently rather than driving to an out-of-town location.

Asds's efforts to catch up have been hampered by Britain's tight zoning regs which make it tough to open new stores. The retailer operates mostly superstores and super centers which average 46,500 to 85,000 sq feet.  So far Asda has 25 stores at 8,000 sq feet.  The Netto deal will strengthen its retail business giving Asda a greater mix of store sizes and expand into new neighborhoods. Cost of the Netto deal is $1.12 BILLION or 778 MILLION pounds.

Wal*Mart is the world's retail leader by annual sales generating 25 percent of annual sales outside the US.  International stores are the fastest growing part of its business. Asda approached Nett about 3 months ago.  It's Wal*Mart's first major purchase in Europe in 12 years.  UK Office of Fair Trading has to approve and stores should be converted by SUMMER mid 2011. 

Did I miss anything?  Please feel free to fill in the gaps.

Now on the more ominous views for dyson's early release of financial results.  Sir James is no dummy.  He's reading the international political and economic tea leaves.  The B-P mess in the Mexico gulf will have major USA and UK back lashes in the very near and far off into the distant future.  He's trying to get a jump on the bad economic environment that will inevitably cause a major trade schism between the US and Europe [as a result of the euro] and the pound and UK due to BP.  It will get very very very ugly.  Some in the US are already talking about a US federal government takeover of BP.  What did it earn last year?  $20 BILLION. 

Dyson boasted that 2/3 of its vacuum market was the USA [2005/2006].  Tho the latest barrage of dyson PR that you posted doesn't make this claim anymore.  It has been dropping as I said since the last quarter of 2007 if my BEST BUY sources are correct.  With the BP mess, it's only bound to get worse.

Carmine D.

PS: These BB sources had it right on the scrubbing of the DC11 by dyson and the fall in price of $100 on the DC15 within months of its USA launch.  Both facts I posted about here and was heckled for right up until the time they came to fruition.

DysonInventsBig wrote:

Hi DIB

I commented /inquired about it.....i know nothing really beyond that. Out of curiousity id like to see it along with the other new oreck.

Will it outclean carpets better than a sanit-comm......that id have to see.

Kinda off topic...sorta....Acouple years ago a customer said she put pantyhose material around the shroud of a dyson 7....and said it kept things clean/cleanr in the cyclones and filter...that perf wasnt affected as long as you dumped daily w/some taps to the bin ....never saw it /but she did all her own service.....wonder howd that work on the shroud....or some type of thin filter media....? just thinking out loud.....

turtle