Small home appliance market is booming! Hot sales and profits soared 1000%!

Today, VeSync, a popular small appliance seller on Amazon, was officially listed on the Hong Kong Stock Exchange! It opened high and soared 88%! According to the disclosed financial report, VeSync's revenue in the first half of this year increased from US$75.3 million in the same period last year to US$129 million, a year-on-year increase of 71.7%; net profit soared more than 10 times, from US$2 million in the same period last year to US$22.5 million! A year-on-year increase of 1025%!

Such a terrifying profit surge is ultimately due to the surge in demand for household products caused by the epidemic at the beginning of the year. At that time, most offline stores were forced to close, and Amazon was one of the few places where people could shop normally. Therefore, VeSync, whose business is highly dependent on the Amazon platform, started a battle!

According to disclosed data, 96.7% of VeSync's revenue comes from the Amazon platform , and more than 80% of its sales revenue comes from the US site. It has three core brands: Levoit, Etekcity, and Cosori. Its main products are small household appliances, such as fryers, ovens, coffee makers, vacuum cleaners, etc. Purifiers and air fryers ranked first and second in sales last year.

At the same time, among the skyrocketing sales this year, sales from Amazon's SC and VC programs accounted for 35.5% and 61.2% respectively. The sales share of the VC program is increasing year by year. Vesync stated that it will continue to increase product sales under the VC program in the future and will continue to negotiate with Amazon on the average supplier discount.

VeSync's IPO prospectus disclosed that 30% of the funds raised will be used to develop new products and update existing products; 25% will be used to expand sales channels and geographical coverage; 25% will be used to upgrade the VeSync application to the IoT platform; 10% will be used to develop and launch smart solutions; and the remaining 10% will be used as working capital.

Looking at Vesync's development over the years, it can be seen that air purifiers and small kitchen appliances are the fastest growing products since 2019, while the company's main products in 2017 and 2018, such as health monitoring equipment, outdoor entertainment products and personal care products, all showed signs of decline in 2019 and were gradually marginalized. After Vesync gradually reduced its efforts on smart switches, sockets and other products and turned to purifiers and kitchen appliances, its profit margin has increased significantly.

In the post-epidemic era, consumers' shopping habits and tendencies will undergo some long-term changes and impacts. The sales data and actions of big sellers are also of some reference value to ordinary sellers in product selection (you can private message me zyqmda for tips on product selection during the epidemic). When developing products recently, you can consider the changes in life after the epidemic.

While the demand on Amazon is extremely hot, the local logistics situation in the United States has been deteriorating. Foreign media even reported that even vaccines are stuck on the road.

Although Pfizer received emergency authorization for the vaccine last week, only some of the vaccines have been distributed to the states, which is only 30% of the expected state vaccine quotas! Pfizer still has millions of doses of vaccines stored in warehouses, waiting for transportation by the federal government.

Some states announced that they had to cut the first batch of vaccine quotas by nearly half due to logistics holdups and delays. Even the most important vaccine distribution can be delayed, and the poor situation of local logistics in the United States is now evident.

However, we cannot blame logistics for this. After all, it is the peak shopping season at the end of the year. Christmas shopping and lockdown have led to an increase in online orders for daily necessities. Major logistics companies are now close to their limits. FedEx recently revealed that the number of parcels has increased by 29% since November to 12.3 million, and both revenue and profit are far higher than expected.

FedEx now has some vaccine shipping orders, and many of them are priority vaccinations for frontline workers at Amazon warehouses. FedEx said there were no delays in these orders, and they are expected to be delivered to their destinations next week and provide vaccination services to frontline workers in a timely manner. In other words, we should be able to see the recovery of FBA warehouse capacity as early as the end of this month!