TURKISH
WHITE GOOD INDUSTRY
Duygu Kıran
Özlem Kuzey
OUTLINE
•General overview of the White Good Industry



Definition
History and Growth of White Good Industry in the World
History and Growth of White Good Industry ın Turkey
•Turkish White Good Industry







Structure of White Good Industry
Conduct of White Good Industry
Performance of White Good Industry
The Role of Government Policy
The Problems of Turkish White Good Industry
Suggestions
Conclusions
White good is a large machine that accomplishes
some routine housekeeping task which includes cooking,
food preservation or cleaning whether in a household,
İnstitutional,commercial or industrial settings.
The Evaluation Of White Goods industry;
1874: William Blackstone invented the first washing machine
which was made from
wooden and worked by human force.
1893: In Chicago World fair first motor-driven dishwasher was
introduced.
1908: The first electric dish washer and electirc oven were
producedç
1914: First electric refrigerator was produced
1930: first deep freze entered the market.
1937: First automatic washing machine was produced.
1958: First no-frost, automatic freze refrigerator and deep freze
entered the market.
1977: Electronic and touchscreen washing machine and
refrigerator were produced
Hıstory and Growth of White Good Industry in Turkey
1955:First white good firm is established.
1959:First washing machine
1960:First refrigerator
1963:First oven
After 24 Jan. 1980:developing white good industry.
1990: Turning point of the industry.
•The structure of White Good Industry



Names,Numbers
Market Shares of Firms
Products and Product Differentiation
PRODUCTIVE
BRAND
FIRM
Arçelik
BRAND
FIRM
Arçelik, Beko,
Altus
Profilo
IMPORTER
Profilo, Bosh,
Elektrolux
Gepa
Elektrolux,AEG
GeneralEle ctric
Siemens
Arçelik, Aygaz,
Beko, Demirdöküm
Frimak
Merloni
Ariston, Philco,
Indesit
Unimeks
White
Westinghouse
Teba
Teba
Singer
Goldstar-Candy
Auer, Calipso
Erler
Moulinex
Türk Demirdöküm
Demirdöküm
Mak
Sanyo-Cosmos
Vestel
Vestel
Vestel
Kelvinator
Raks
Hitachi
Ardem
Auer
FTC Frigidaire
ARÇELİK
BSH
VESTEL
İNDESİT
TEBA
Total
2002
2003
2004
2005
Dom. SalesM. Share Dom. Sales M. Share Dom. Sales M. Share Dom. Sales M. Shar
3.772.687 54,60% 3.356.460 54,41% 1.973.567 54,77% 1.867.241 57,63%
853.183 26,33%
885.220 24,57%
1.727.735 25,00% 1.494.979 24,23%
6,59%
213.565
360.876 10,02%
911.795 14,78%
1.163.844 16,84%
8,74%
283.101
9,39%
338.247
6,02%
371.249
3,56%
245.997
0,70%
22.800
1,26%
45.381
0,56%
34.696
6.910.262 100,00%
*December 2005 value
**Dom. Sales: Domestic sales
***M. Share: Market shares
****Source: BESD
6.169.179 100,00%
3.603.291
100%
3.239.891 100,00%
•Products and Product
Differentiation
Main white good products:
Refrigerator
Dishwasher
Waching machine
Oven
• Products and Product Differentiation
Refrigerator: no-frost, double door,table top
refrigerators,single door,side by side,nostalgia
models
Washing machines:capacity of laundry
between 3 and 10 kilograms
Dishwasher:normal, combi and narrow
Ovens :double parts and single cavity(narrow,
fan heating, electric with fun,multifunctional).
•Conduct of White Good Industry
 Business Objectives



Pricing Policy
Branding and Marketing
Research and Development
•Business Objectives
Mission : Economical apropriate, innovative
and competitive products.
Vision : Generating strategies and making
profits.
• Pricing Policy
•Big export capacity with exporting the
%60 of
productions.
•All brands in the world produces in
Turkey.
•Foreign firms import the white goods
from Turkey.
•Branding And Marketing
An example of the marketing study in the white good
industry:
Vestel Marketing has a structure that emerge 7 parts:
sales, marketing, services and operation, finance,
information and risk control, information technologies
and human resources. In the part of service and
operation, Vestel marketing realized that products
distributes rapidly and actively.
•Branding And Marketing
Vestel marketing uses three different distribution
channels:
Main distribution channel which is a dealer group
consists of stores
and showrooms.
Second distribution channel is wholesalers.
Third channel consists of big retailers like
Carrefour, Metro,
Praktiker, Tansaş and Maxi.
• Research And Development
An example for R&D study in white good industry is;
Arçelik R&D, which works at global standards for
technology and product development, focuses on products
that:
•Are environment-friendly (recover, recycle, reuse and
low energy, water and detergent consumption),
•Ensure comfort and customer satisfaction
(smart, quiet, practical),
•Are affordable and comply with the standards of the
future.[1]
[1] www.arcelik.com.tr
•Research And Development
Another example for R&D study is
Vestel R&D study;
Vestel invested in five points
(England, USA, Hongkong, Manisa,
İzmir) in the world for R&D projects.
It’s aim is pursuing the growth in the
world closely.[1]
[1] www.vestel.com.tr
THE PERFORMANCE OF WHITE
GOOD INDUSTRY
•Profitability
And Growth
Production
Export
Import
Domestic Sales
•Quality Of Productions
•Technological Progress
Profitability And Growth

Production of White Goods
PRODUCTION
1995 1996 1997 1998 1999 2000
REFRIGERATOR 1.637 1.638 1.850 1.875 2.139 2.446
AUTO. WASH. MA 828 993 1.454 1.375 1.219 1.343
DISHWASHER
236 255 447 318 325 351
OVEN
589 735 921 907 866 1.048
TOTAL
CHANGE
*September 2005 values
2001
2.483
1.030
223
1.096
2002
3.318
1.654
346
1.341
2003
4.286
2.459
399
1.574
( 1000)
2004 2005*
5.308 4.242
3.963 3.084
657
556
1.715 1.177
3.290 3.621 4.672 4.475 4.549 5.188 4.832 6.659 8.718 11.643 9.059
100 110 142 136 138 158 147 202 265 354
** Source: TURKBESD
Profitability And Growth

Export of White Goods
EXPORT
1995 1996 1997 1998 1999
REFRIGERATOR 802 693 785 818 1.046
AUTO. WASH. MA 41 53 87
121 180
DISHWASHER
2
7
110 91
88
OVEN
141 217 292 355 450
TOTAL
CHANGE
*September 2005 values
** Source: TURKBESD
2000
1.089
273
83
557
2001
1.530
444
66
792
2002
2.247
989
149
997
2003
3.034
1.550
239
1.189
( 1000 )
2004 2005*
3.361 3.062
2.236 1.798
288 255
1.326 763
986 970 1.274 1.385 1.764 2.002 2.832 4.382 6.012 7.211 5.878
100 98 129 140 179 203 287 444 610 731
Profitability And Growth

Import of White Goods
REFRIGERATOR
AUTO. WASH. MA
DISHWASHER
OVEN
IMPORT
1995 1996 1997 1998
39
77 200 303
6
114 164 253
3
61 118 198
0
8
10 32
TOTAL
CHANGE
48
100
* September 2005 values
** Source: TURK BESD
260
542
( 1000)
1999 2000 2001 2002 2003
278 223 91 51 41
208 295 169 159 191
188 224 101 98 102
38
57 28 29 26
492 786 712 799 389
1025 1638 1483 1665 810
337
702
360
750
2004
44
187
177
32
2005*
36
89
140
36
440
917
301
Profitability And Growth

The Comparison of Export And Import of White Goods
EXPORT
THE COMPARISON OF EXPORT AND IMPORT
(x1000 )
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
986 970 1.274 1.385 1.764 2.002 2.832 4.382 6.012 7.211 5.878
IMPORT
Import/Export
48
5%
* September 2005 values
** Source: TURK BESD
260 492
27% 39%
786
57%
712
40%
799
40%
389
14%
337
8%
360
6%
440
6%
301
Profitability And Growth

Domestic Sales of White Goods
DOMESTIC SALES
1995 1996 1997 1998 1999
REFRIGERATOR 834 969 1.231 1.407 1.258
AUTO. WASH. MA 786 1.067 1.464 1.494 1.222
DISHWASHER
241 319 427 478 406
OVEN
445 519 608 587 474
TOTAL
CHANGE
* September 2005 values
** Source: TURK BESD
( 1000 )
2000 2001 2002 2003 2004 2005*
1.468 1.018 1.088 1.362 2.004 1.632
1.417 795 824 1.076 1.917 1.394
503 265 282 261 526 472
536 337 339 378 599 472
2.306 2.874 3.730 3.966 3.360 3.924 2.415 2.533 3.077 5.046 3.970
100 125 162 172 146 170 105 110 133 219
Quality of White Goods





Quality of products is important in White
good industry because it effects
Brand
Consumer Satisfaction
Competition
Market Share
Technological Progress
In general, the cheap technologies
which are improved in aero-automotive
sectors are adopted to white goods. That
kind of technological improvement
activities are used to develop the products
for competition and to reduce the costs.
THE ROLE OF GOVERNMENT POLICIES
Government incentive application
should be raised for developing white
goods industry. Because;
 In white goods industry, the %80-90 of
the ancillary industry firms are small and
medium scale firms (KOBİ), investments
seem impossible without government
incentives for KOBİ.
THE PROBLEMS OF TURKISH WHITE
GOOD INDUSTRY AND SUGGESTIONS




Problems: Like every industry, Turkish White
Good Industry meets some obstacles and has
some problems;
White goods are appraised like luxury
consumption goods and the tax rates are high
about %25 which causes decrease in sales.
In the white good industry, the sales of raw
materials with high price is a serious problem for
the development of industry.
Satisfaction level of television and refrigerator
approaches to %100. The demand for
refrigerator as a white good can increase only if
high-tech products are produced.
THE PROBLEMS OF TURKISH WHITE
GOOD INDUSTRY AND SUGGESTIONS

In the white good industry, the most
important negative factor is the general
situation of economics and change in
income distribution. The decrease in
purchasing power of customers causes the
deceleration of the growth rate of
domestic market.
THE PROBLEMS OF TURKISH WHITE
GOOD INDUSTRY AND SUGGESTIONS




Suggestions: Some suggestions which can help
to overcome the problems of industry are;
High tax must be removed for consumption
goods. For this reason, consumption goods and
basic necessity must be separated.
All producers have recognized the importance of
export for the development of the white good
industry. Firms must find new foreign markets to
provide the continuity of increasing export.
Sellers must be adapted to changing the
marketing structure.
THE PROBLEMS OF TURKISH WHITE
GOOD INDUSTRY AND SUGGESTIONS



Personnel and the employees must be trained to
fulfill the quality product and efficiency by the
implementation of professional education
project.
The producers and ancillary industry must
concentrate on standards and quality control.
For stable growth, firms must prepare a
production and sales plan which includes energy
savings, simple usage, after-sale service and
convenient price factors in production and sales
stages.
CONCLUSION


Turkish White Good Industry firms compete with
global markets by producing high-quality
products. They follow the technological, design
and quality improvements and join in world fair
organizations in order to give the new products
publicity.
In long term future plans, the growth rate of
white good market is expected about %7 per
year. With this foresight, after ten years, with 15
million production capacity and 6 billion Euro
endorsement, Turkish White Good Industry will
have the %25- %30 of market shares in Europe
market. With the same foresight, the
employment rate is expected to be about 200
thousands.