United States / Industry Insights
Outdoor Equipment Stores Struggle Amid Big-Box Retail Competition
by Rebecca Simon
Aug 20 2018

Despite capturing enough demand to remain profitable, lawn and outdoor equipment stores in the US have struggled amid fierce competition from big-box home improvement stores.

“This trend is because home improvement stores are better able to gather data on consumption patterns nationwide and have been able to stock and sell the most sought-after products, maximizing shelf allocation and profitability,” says IBISWorld analyst Claire O’Connor.

The lawn and outdoor equipment stores industry is made up of stores that sell lawn and outdoor power equipment, such as chainsaws, mowers, garden tractors and leaf blowers, to a variety of consumers, including households, farmers, and ranchers.

IBISWorld estimates that lawn and outdoor equipment stores industry revenue will increase an annualized 2.6% to $7.6 billion over the five years to 2018. The industry has experienced heightened demand as a result of growth in per capita disposable income.

While improvements in the overall US economy have helped the industry during the current period, the threat of competition from big-box retailers like Home Depot remains ubiquitous.

Lawn Stores

Lowe’s, the second-largest company in the home improvement stores industry, is expected to achieve the nearly $4.2 billion from the sale of outdoor equipment. This is the equivalent of 55.5% total revenue for the lawn and outdoor equipment stores industry.

As a result of this looming threat, many lawn and outdoor equipment stores have been consolidating to remain profitable. With more companies exiting the industry, smaller stores are better able to meet local demand. In addition, many lawn and outdoor equipment stores are expanding their online presence to connect with consumers in new and more convenient ways.

“Advances in e-commerce will disproportionately benefit larger companies, especially home improvement stores and e-tailers that are already running well-established websites,” says O’Connor.

Despite the persistent threat of external competition, IBISWorld estimates revenue for the lawn and outdoor equipment stores industry to grow at an annualized rate of 0.7% to $7.8 billion over the five years to 2023.

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