Bulletin
Investor Alert

London Markets Open in:

March 31, 2020, 11:36 a.m. EDT

Coronavirus pandemic driving sales of small appliances for cooking, health and wellness

Target’s CEO said the retailer is seeing the shift in spending to small appliances

By Tonya Garcia, MarketWatch


Bloomberg
Now that shoppers have stocked up they’re spending on small appliances, NPD data shows

Now that consumers have stocked up on toilet paper, disinfectant wipes and other household necessities, they’re turning their attention to appliances that aid in cooking and health and wellness, experts and retailers say.

Small appliance sales grew 8% for the week ending March 14, according to data from the NPD Group, with items like water filtration devices seeing a triple-digit jump in demand. Sales of hand-held cleaning devices more than doubled, and air purifying machines nearly doubled year-over-year.

With more people in the kitchen instead of eating out, small kitchen appliances are hot items as well. Bread makers and electric skillets have seen a triple-digit jump, according to NPD. And sandwich makers, electric pasta makers, citrus juicers and rice cookers have all seen sales grow.

See: Best Buy sees surge in demand for items that help people work from home

NPD thinks having kids at home more has reintroduced carbohydrates consumption at a greater level as well.

“Our primary focus right now is on staying healthy, and staying home is playing a critical role in that effort,” said Joe Derochowski, home industry advisor at NPD.

Restaurant transactions slumped 36% for the week ending March 30, NPD says. Quick-service restaurants, which includes McDonald’s Corp. (NYS:MCD)   and Wendy’s Co. (NAS:WEN)   , saw business drop 34% for the week ending March 22.

NPD says on-premise dining accounts for 52% of industry dollars while take-out, delivery and drive-thru represent 48%. Digital orders accounted for 13% of all off-premise restaurant industry dollars for the year ending Feb. 2020.

And Coresight Research data found that nearly two-thirds of those polled (64.5%) said they were avoiding restaurants, bars and coffee shops.

Watch: Can companies keep up with the new demand of online grocery shopping?

Target Corp. (NYS:TGT)   Chief Executive Brian Cornell said during a media call last week that the retailer is seeing a shift in spending toward small appliances as more people prepare meals at home.

“Among those expecting to retain behaviors from the outbreak, prevention through better hygiene and a focus on wellness were top responses, but around half also expect to focus more on people who mean a lot to them,” Coresight Research found.

The Consumer Staples Select Sector SPDR ETF (PSE:XLP)   is down 1.5% over the past year. The Consumer Discretionary Select Sector SPDR ETF (PSE:XLY)   is down 12.3%. And the S&P 500 index (S&P:SPX)   has fallen 6.9% for the period.

Link to MarketWatch's Slice.