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Blooming Construction Trends Drive Residential and Commercial Water Heaters Markets - New analysis from Frost & Sullivan, U.S. Residential and Commercial Water Heaters Markets, reveals that the market earned revenues of $2.55 billion in 2005 and estimates this to reach $3.02 billion in 2012
Blooming Construction Trends Drive Residential and Commercial Water Heaters Markets

 

PRZOOM - /newswire/ - Palo Alto, CA, United States, 2006/11/21 - New analysis from Frost & Sullivan, U.S. Residential and Commercial Water Heaters Markets, reveals that the market earned revenues of $2.55 billion in 2005 and estimates this to reach $3.02 billion in 2012.

   
 
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In 2005, the traditional wholesale business accounted for 55 to 60 percent of the residential and commercial water heaters market while retail held 40 to 45 percent. In general, wholesale channels have larger availability of models and specialty lines, while retail chains focus on high volumes and low product margins. Though consumers are inclined to contact plumbers when their water heaters fail, trends seem to favor discount consumer retail outlets as individuals become accustomed to seeing water heaters in those establishments.

New analysis from Frost & Sullivan, U.S. Residential and Commercial Water Heaters Markets, reveals that the market earned revenues of $2.55 billion in 2005 and estimates this to reach $3.02 billion in 2012.

If you are interested in a virtual brochure, which provides manufacturers, end users, and other industry participants with an overview of the U.S. Residential and Commercial Water Heaters Markets, then send an e-mail to Trisha Bradley, Corporate Communications, at trisha.bradley[.]frost.com with the following information: your full name, company name, title, telephone number, fax number, and e-mail address. Upon receipt of the above information, an overview will be sent to you by e-mail.

“Water heating costs in the United States are a major expense to the typical residence and building, and with a population reaching 300 million growing at over 3.0 percent, new construction units and replacement of water heaters remains a robust business,” says Frost & Sullivan Research Analyst Jorge Moreno. “In 2005, replacement orders in the United States accounted for approximately 82 to 85 percent of the water heater markets, while the remaining 15 to 18 percent revenues were generated from new construction.”

Substantial growth in new construction in a year translates into double benefits for manufacturers as they sell new tank water heaters for new applications, which increases the future replacement business potential. However, new construction in the United States has reached record rates, stimulated demand for new water heaters, and increased the number of units needing replacement in the future.

Delivering water heaters to the market is a critical challenge for manufacturers and supplying the product to contractors is probably the single most important step in the distribution process. In 2005, the traditional wholesale business provided 55 to 60 percent of the residential and commercial water heaters market while retail supplied 40 to 45 percent.

"Distribution channels have been fighting for the same contractor base and retail distributors have made significant gains since the mid 1990s in convincing contractors to purchase from them," explains Moreno. "In general, wholesale channels have larger availability of models and specialty lines while retail chains focus on high volumes and low product margins."

Despite the challenges, mergers and acquisitions in this market have significantly changed its structure, condensing the competition into four dominant participants and enabling the market to set higher prices. Revenues spiked in 2003 due to ANSI Z21.10.1-2001, which stipulated that the design of water heaters ‘shall not ignite flammable vapors outside the water heating created by the spilling of gasoline onto the floor’.

The U.S. Residential and Commercial Water Heaters Markets is part of the Building Management Technologies Growth Partnership Service, and it provides analysis of the market share between gas tank and electric tank water heaters and a detailed look at the competitive structure of the market post 2003. This study also includes a thorough examination of the following markets: U.S. residential gas and electric tank water heaters, commercial gas and electric tank water heaters, and tank less water heaters markets. Interviews are available to the press.

Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services, and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies, and the investment community by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics, and demographics.

 
 
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Blooming Construction Trends Drive Residential and Commercial Water Heaters Markets

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