Check out how cost cutting helped Whirlpool.

The world’s biggest appliance maker used cost cuts to offset weak sales as it reported a higher-than-expected quarterly profit. Whirlpool also raised its full-year profit outlook, citing downsizing and — yes, you guessed it — cost cuts as demand remains uncertain in many markets.

Sales at appliance makers like Whirlpool, known for its Maytag and KitchenAid brands, and Sweden’s Electrolux have suffered in the global economic slowdown as consumers trim spending on items not deemed essential.

Whirlpool’s recent cost cutting actions have included plant closures, consolidation of its Chinese operations, lower retirement plan contributions, frozen salaries and lower capital spending.

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(Reuters photo)

Check out who has the highest customer satisfaction ranking among major appliance retailers.
 
It’s Best Buy, according to a study by J.D. Power and Associates.
 
The electronics retailer received a 797 out of 1,000 on the scale, performing particularly well in installation service and delivery service, J.D. Power said in a news release.
 
The study also takes into account sales staff, the store facility, merchandise and price.
 
Next was hhgregg at 794 and Lowe’s at 792. Sales staff and price were pluses for hhgregg, while Lowe’s did particularly well in store facility and merchandise, J.D. Power said.
 
The study is based on responses from more than 4,200 consumers who bought a laundry or kitchen appliance within the previous 24 months.
 
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(Photo: Reuters)

Check out the surprise quarterly profit at Whirlpool.

The world’s biggest appliance maker, known for its namesake, Maytag and KitchenAid brands,  was aided in the unexpected good news — analysts were expecting a loss — by its cost-cutting efforts. The company has frozen salaries, reduced its contribution to retirement plans and taken other steps to save money amid the recession.

Despite the profit, sales tumbled 23 percent in the first quarter. Whirlpool also said it now expects 2009 industry unit shipments in the United States and Europe to decline more than previously expected.

Whirlpool was not the only company getting a boost from cost cutting. Energizer, which makes its namesake batteries, Schick razors and Playtex tampons, posted a higher-than-expected profit as cost cutting helped offset pressure from foreign exchange and consumers trading down to cheaper batteries.

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(Photo courtesy of Whirlpool Corp)

The recession, corporate cutbacks and lower demand for big-ticket items are not stopping LG Electronics from expanding its U.S. appliance business.

The South Korean electronics giant this week unveiled a facility in Atlanta that will be used to train engineers, contractors and sales staff how to use its commercial air conditioning products.

LG, which has been gaining U.S. appliance market share as residential customers buy its washing machines, hopes the Atlanta facility, its first commercial training center in the U.S., will help boost sales of heating and air conditioning systems to hotels, hospitals and schools.

LG is the world’s biggest maker of air conditioners.

“Consumers are looking for value,” Michael Ahn, chief executive of LG Electronics North America, said in a short interview at the training center.

“We’re seeing more (appliance) growth at the lower end than the high end” right now, Ahn added. “Total demand will be decreased next year.”

To respond to the need for value, Ahn said LG was offering lower-priced versions of its Tromm washing machine (pictured), with a washer-dryer pair priced as low as $1,200. LG has been selling major appliances in the U.S. for about six years, and caters to the premium market.

The U.S. housing slump and tighter credit has hurt appliance demand. U.S. shipments of major appliances were down about 9 percent for the year to date through late October, according to the Association of Home Appliance Manufacturers.

(Photo: LG Electronics)

The beaten-down appliance sector got a shot in the arm on Black Friday as many consumers bought new washers for their laundry rooms, one spot survey shows.

Appliance sales, especially of washing machines and dryers, were up significantly over Thanksgiving weekend as shoppers responded to discounts, said David MacGregor, an analyst with Longbow Research.

More consumers are also buying extended warranties for these big-ticket items, he added.

MacGregor, who conducts regular surveys of appliance sellers, said 87 percent of retailer contacts indicated sales met or exceeded expectations, in some cases doubling forecasts for the weekend.

Sears, the biggest U.S. appliance retailer, benefited strongly as promotions and doorbuster offers drove Black Friday traffic. The retailer’s Black Friday deals included a Kenmore washer-dryer pair priced at $599 that normally sells for $1,199, a spokesman told Reuters.

“Based on our estimates of costs, we believe that Sears probably sold most of these heavily discounted items at or below cost and then tried to recover some margin through sales of extended warranties,” MacGregor said in a research note.

The continuing U.S. housing slump and tighter credit has hurt appliance demand. U.S. shipments of major appliances were down about 9 percent for the year to date through late October, according to the Association of Home Appliance Manufacturers.

The analyst said he expects the Black Friday strength to aid Whirlpool, whose brands hold leading market share positions in most categories. Whirlpool’s shares, which have fallen 50 percent this year, were up 8 percent on Thursday.

Photo: Whirlpool

Check out the Whirlpool of woe.
 
Five thousand. That’s the number of jobs Whirlpool plans to cut by the end of next year as it faces falling sales in North America and a potential global recession.
 
Appliance makers have already been hammered by the U.S. housing collapse. Now the credit crunch is likely to keep demand down, the world’s largest appliance maker said.
 
“The global credit crisis has had a profound negative impact on what was already a weakening and very fragile global economy,” Whirlpool Chief Executive Jeff Fettig (pictured left) said in a statement.
 
Some of the job cuts had already been announced. Others were new. They all add to a slew of job cuts announced by corporate America in recent weeks.
 
That creates a spiral of people not being able to buy the goods the manufacturers make, which could cause manufacturers to cut more jobs as the economy keeps swirling down the drain.
 
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(Photo: Reuters)

Sears, Roebuck is looking to grow home-goods sales by adding stores away from malls as shoppers flock to new retail centers.

That off-mall strategy includes more dealer stores located in smaller, rural markets, and home appliance showrooms in big cities.

Sears has about 860 dealer stores and 24 appliance showrooms, in addition to its more than 900 traditional mall-based stores. This year, the retailer is adding 75 dealer outlets and about 50 appliance showrooms, said Steve Titus, vice president of Sears Dealer Stores, in an interview.

The Hoffman Estates, Illinois, retailer is the top-selling U.S. appliance chain but has seen its dominance challenged as home-improvement stores such as Home Depot and Lowe’s expand their offerings.

Now, as Home Depot and Lowe’s cut their store growth in the slowing U.S. economy, Sears Holdings is looking to grow key businesses in hopes of benefiting when conditions improve.

The appliance showrooms (pictured), which include as much as 5,000 square feet, are located in high-traffic retail strips that also include other big-box stores such as Target.

Sears is hoping the appliance showrooms, which are currently in Minneapolis, Dallas, Houston, Atlanta and some other big cities, will help fill the gaps in areas not served by its mall stores or existing dealer stores.

“If we pull this off right, it could really help us grow our appliance business,” Titus said.

The dealer stores are locally owned and operated. Owners pay rent and expenses and Sears provides the products and pays a commission for selling them.

Even in the slow economy, “we have several hundreds of people requesting ownership of these stores right now,” Titus said.

Photo/Sears

If you think that 10-year-old refrigerator is saving you money, think again.

As the slumping U.S. housing market depresses demand for refrigerators and washers, manufacturers are looking to get the word out that newer appliances can save substantial amounts of energy.

The Association of Home Appliance Manufacturers, a group of appliance makers and suppliers, has drafted a report that quantifies the energy savings of some products.

Since 2000, refrigerators, dishwashers and washing machines have accounted for a 43 percent decrease in energy consumption, the group says.

Improvements in technology and design have made newer appliances more efficient. For example, washing machines now offer shorter wash cycles, while newer dishwashers have air drying options that cut energy use.

Front-loading washing machines (such as the one pictured) require less water and energy to operate. Energy consumed by clothes washers has fallen 63 percent since 2000, according to the data.

Another snippet: the average refrigerator sold today uses less energy than a 60-watt light bulb that runs 24 hours a day. More efficient compressors and better insulation help explain why.

“This data shows that replacing older appliances can make a huge impact in a family’s energy budget,” AHAM President Joseph McGuire said.

Still, the savings do have a cost. Some front-load washers cost more than $1,000.

Would you upgrade your older appliances to save energy?

Photo: LG Electronics

Check out a nice GE convection oven.
 
It may be for sale, along with the rest of GE’s appliances division.
 
General Electric said it is seeking “strategic options” for the appliance business, which could include a partnership, spinoff or sale.
 
Lots of consumers are familiar with GE refrigerators, dishwashers and the like. But the business accounts for only about 4 percent of the company’s sales. It takes a lot of dishwashers to equal one jet engine.
 
Aside from aviation, the company’s other business lines include energy, electrical distribution healthcare and media & entertainment (think NBC television.)
 
So why keep holding on to appliances, especially when that business is being hurt by the long-running housing slump?
 
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(Reuters photo)