New analysis from Frost & Sullivan, North American Selected Accessories Aftermarket, finds that despite a constant state of flux, this market generated more than $226.6 million in manufacturer-level revenues in 2007 and will most likely reach $234.4 million by 2014.

"Accessories represent discretionary purchases and are very popular with owners of all types of vehicles," said Frost & Sullivan Senior Industry Analyst Stephen Spivey.  "The long-term outlook is good for buyers and sellers of these products, despite the challenges presented by the current economic environment."

Automotive accessories are high SKU-count products.  The SKU count can quickly escalate once the product manager has decided on color options, performance, application fit, packaging, and brand, since the right mix is vital for a successful program.

Being low-cost, high-volume, point-of-purchase items, automotive accessories are likely to experience stable growth at a compound annual growth rate of just 0.3 percent until 2014, due to flat unit sales and declining prices.  Additionally, decreased consumer spending in a flagging U.S. economy restrains this modest growth forecast.

"Industries that supply large durable goods are typically the first to feel the effects of a weakening economy," said Frost & Sullivan Research Analyst Kyu-min Oh.  "A slowdown in new vehicle sales will also limit the growth potential of accessory products in the near term."

Decreased discretionary spending by customers that aim to cut costs coupled with the drop in accessory prices provides market stability. For instance, declining prices help end users obtain a low-cost means of improving vehicle value through enhanced aesthetics, occupant comfort and convenience, and driving safety.

Accessory manufacturers and retailers will aim their product development efforts at the passenger car segment.  The market will require constant innovation to stave off price wars as well as ensure vehicle compatibility and adherence to a contemporary style.

"However, since the majority of accessory products have very low barriers to entry, a large number of competitors offer similar products," Spivey said.  "Those suppliers that can make their products different or better will be the most successful."

A market characterized by replication entails high innovation costs.  Manufacturers cannot sidestep this process if they wish to survive in the long term.  They must focus on offering differentiated and value-added services that reduce product costs while also building consumer loyalty.

Manufacturers in each product category will soon look to make investments in brand development through packaging and merchandising, bundled offerings, and consumer support that make each product the turnkey solution for the distributor or retailer.

Companies currently need more than just a trendy product to attract automotive retailers.  Brand, packaging, point-of-purchase presentation, payment terms, and supporting line products are fast becoming standard offerings in the market.