Almost every US household already owns a vacuum cleaner, but the industry continues to sell replacements and special-purpose cleaning appliances. Uprights outsell canister and stick types by a margin of four to one. Retail sales amount to almost $3 billion, with mass merchants selling 29% of upright vacuums, Sears Roebuck & Co selling 15%, and department stores 12%.

The full-size vacuum cleaner industry has almost 100 percent household saturation, but it sure doesn't act like there's no room to grow. Almost every household in America has at least one vacuum cleaner, yet consumers still replace models and buy other types of vacs for different areas of the home.

They're still interested in uprights with tools on board particularly those advertised at $99 and below in mass retail outlets.

As a result of this activity, retail sales in all segments of the electric floor care industry are approaching $3 billion, according to industry sources.

"Floor care is experiencing moderate to healthy growth," said James Bazet, president of Ryobi Motor Products' floor care division. "We're seeing good growth in the market across the board and both us and others are coming out with innovative products to help the market continue to grow."

Wider product offerings, advertising and continued retail support have been integral to floor care's growth.

Michael Merriman, president of Royal Appliance Manufacturing, said, "Within the last five years, there's been a complete face-lift in the product offering. Couple that with advertising and people have a reason to accelerate their purchasing to a more fully featured model."

"As baby boomers move into their second home, they may find they prefer to have more than one vacuum for specific areas of the house," he added.

John Hoppe, Eureka Co.'s vice president of marketing, noted, "Retailers continue to support floor care in a big way because it's a consistent, growing business. It's growing because people are adding second, third and fourth vacs to their homes."

Jerry Lauer, vice president of marketing at Hoover, pointed out advertising helped spur those purchases.

"Floor care was heavily exposed in the media," Lauer said. "The three biggest brands invested considerable monies in advertising, especially on television. And the more you expose the category, the better it is for retail."

Other sources said increased consumer interest in the category may be due, in part, to the economy. When the economy is good, the vac industry responds and people replace old vacs.

"Vac sales are a big replacement business," said a retailer. "There are a lot of people who have vacs that are six, eight, nine and 10 years old that are cycling back into the system. The impetus to buy a new cleaner is driven by the fact that people that have older vacs don't have the features of the current machines."

This factor may have affected unit shipments, which were up for a third consecutive year. Last year, the Vacuum Cleaner Manufacturers' Association recorded about 14.1 million full-sized vacuums were shipped to retail, up 10 percent from 12.8 million in 1993, 12.4 million were shipped in 1992.

Industry sources said of those 14.1 million units shipped, uprights and sticks had single-digit growth while canisters' was double-digit.

Uprights shipped 9.91 million units in 1994, a 6 percent increase over 9.32 million the previous year. Stick vacs grew 16 percent from 1.85 million in 1993 to 2.14 million in 1994, Canister vacs registered in at 2.04 million, surging ahead 21 percent from the previous year's 1.67 million.

UPRIGHTS STILL OUT FRONT

In general, the floor care industry continues to be driven primarily by uprights, then stick brooms and canisters,

In uprights, sources said pricing thresholds have been broken, spurring growth. For example, a 12-amp machine with tools on board that used to retail for around 200 is $139 today.

Bruce Gold, president of White-Westinghouse Floor Care, agreed many new uprights have entered the market, including promotionally priced products such as the $69.99 model at Wal-Mart.

Floor care manufacturers said competitively priced uprights with tools on board are particularly appealing to first-time buyers.

Jim Rogers, national marketing manager at Panasonic, said tools on board is a convenience and cuts cleaning time. There's a large market out there that still does not have tools on board or tools built in, he adds.

Another floor care vendor agreed. "Manufacturers might think on-board tools is an old idea because it's been out for three to four years, but there are still a lot of consumers who probably have a canister and are buying their first upright with on-board tools. So it still has a lot of novelty value to consumers.

Hoppe of Eureka pointed out, "Anyone with an old unit who hasn't bought a vac in the last five years doesn't have one of these upright vacs with tools, which are a lot more powerful than earlier models."

Bissell is taking the tools-on-board concept a step further with the Bissell Plus, an upright that converts to a full-power portable. The idea is to eliminate multiple vacuums in the front closet.

Jim Krzeminski, vice president of sales at Bissell, said early infomercial results have been quite good. But the real test will be at retail.

"Retail will tell us the story shortly," Krzeminski said. "We will see if we can put this $270 product on a shelf alongside the likes of some machines from very powerful brands well under $150, and for that matter under $100. With the right features and a differentiated product, we are betting consumers will respond."

In stick vacs, price is becoming an issue, the range is $19.99 all the way to $49. Hoppe said Eureka would be the first major brand to offer a $19.99 stick vac.

An East Coast retailer added that older consumers, who presumably have less manual dexterity than younger buyers, have become very interested in stick vacs.

A versatile, lightweight stick broom is easier to pick up and handle, and has enough power for older adults who live in smaller homes or condos.

Other sources said some consumers use stick brooms in the kitchen in place of broom and dustpan. They are also good for recreational vehicles and vacation cabins.

Canister vac sales grew in 1994, and vendors credit Sears with spearheading it; and by all accounts, Sears appears to have benefited most.

Sears vac buyer Ray Brown said he was pleased the growth in canisters last year and attributed it to the store's renewed concentration on the business and its local marketing focus.

"Last year we really went after the business because we are such a dominant player in it," Brown said. "And since the canister business is very regionalized, we applied our resources to those areas. The results of that combination were very good."

Several floor care vendors said Sears' commissioned salespeople, who can demonstrate and sell, are the reason the chain is so successful in canisters.

Small canisters appear to be enjoying renewed growth, too, Several vendors said many consumer who have more than one vac have a canister.

"People are beginning to realize they need a different type of vacuum for different cleaning project," said Hoppe of Eureka. "For example, a lot of people are putting in hard wood and cenamic floors in hallways and parts of rooms, and a straight air cleaner does a better job than an upright. You also have the versatility of a canister getting into hard-to-reach areas."

David Stern, marketing director of Metropolitan Vacuum Cleaner, said it has been moving a lot of mini canisters lately, mostly to older adults who don't want to carry around a big vac and baby boomers living in townhouses and condos who don't need a larger machine.

The Bissell Plus, the combination upright and power portable, aims to satisfy those consumers, too.

"Bissell's theory is, people like a vacuum with onboard tools, but find it's just not practical to drag around," said an industry source. "Their product indicates compact canisters are important, but just need to be made more accessible."

RETAIL OPPORTUNITIES

In vacuum cleaners, as in some other housewares categories, sources said there's a long-term move to the mass merchant and away from department stores. in general, consumers tend to buy a lot more durables from the mass market.

Statistics collected by HFN indicate mass merchants represent 29 percent of full-size vacuum cleaner retail distribution, followed by Sears with 15 percent of the business and department stores at 12 percent.

With a smaller share of the retail volume, department stores are focusing on niche items and merchandising popularly priced items as a convenience to customers.

Warehouse clubs represent about 8 percent of the business and a few sources said the category has already matured and shaken out.

One source said warehouse clubs don't seem to emphasize vacuum cleaners, Sam's cut back on basics a few years ago. However, B.J.'s, another warehouse club, offers a nice Hoover selection in key areas.

Independent vac shops and appliance stores, 7.5 and 7 percent of the market, respectively, remain vibrant, thanks to the one-on-one service they offer. One manufacturer said these outlets, like Sears, have qualified salespeople to help consumers.

Door-to-door selling, accounting for 7 percent of retail volume, is still viable, too. its staying power after so many years is due to highly motivated salespeople and quality products.

Catalog showrooms bring in 6 percent of the business, according to HFN's statistics. Sources said that while the showrooms do a good job of merchandising vacuums and sell considerable volume, there are only, a few key catalog showroom chains left in the U.S.