Kitchen & Bath Design News

MAY 2015

Kitchen & Bath Design News is the industry's leading business, design and product resource for the kitchen and bath trade.

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and decorative hardware (94%) for the kitchen (see Graph 5) , along with vani- ties (91%) and decorative hardware (89%) for the bath (see Graph 6). While downsizing had been the buzzword in recent years, interest- ingly, nearly 20% of those polled plan to increase their showroom space in the next few years. Nine in 10 (91%) showrooms of those surveyed carry both kitchen and bath products, with those show- rooms averaging nearly eight kitchen displays and just over six bath dis- plays. Additionally, nearly half (49%) of those polled are planning to add kitchen displays or vignettes over the next 12 months (see Graph 7) , while nearly a third (32%) say they plan to add bath displays or vignettes in the coming year (see Graph 8) . The showrooms carry an average of 6.6 diferent kitchen product lines and 5.5 bath product lines. DEMOGRAPHIC TRENDS Dealers and designers surveyed re- ported doing more projects with Baby Boomers and higher-income house- holds, with 59% saying they are doing more projects for boomers (48 to 67) than they did compared to a year ago. Nearly half (48%) say they are doing more projects for higher-income house- holds compared to last year, while 47% mention doing an increased number of projects for Gen X (age 33-47). While mature (68+) homeowners may have more capital due to working longer, only 29% of dealers and design- ers surveyed say they are doing more projects for these consumers as com- pared to last year, and 16% say they are doing fewer than they did last year. Neither do single people seem to be jumping on the kitchen and bath remodeling bandwagon, if the survey is any indication, with less than a ffth (18%) of respondents saying they are doing more jobs for this segment, while 15% say they are doing fewer jobs for these homeowners as com- pared to last year. When asked about the average cost of their projects, dealers and de- signers reported an average kitchen price of $36,400 and an average bath price of $18,400. BUSINESS CHALLENGES Although the economy continues to pick up, when it comes to critical is- sues and business challenges, price and budget were still oft-cited con- cerns. Indeed, dealers and designers surveyed report "customers with un- realistic budget expectations" as their greatest challenge, with the next most commonly cited business challenge "customers being more price sensitive." One respondent notes, "[A major challenge is] customers looking to take design work to other competitors looking to beat our deal. The competi- tor [then] uses our design." Internet competition was also cited as a challenge facing today's kitchen and bath dealers. As one points out, "Our suppliers cannot keep up with the low prices shown online at some retailers. Customers feel that we should purchase the [lowest-priced product online], even if we feel the online company is not reputable. But challenges from the Internet aren't all price related; rather, they can be knowledge related as well. As one respondent states, "Customers think they are the experts instead of [the designer] due to the Internet and manufacturers allowing the end user to 'design' on their sites." A shortage of time was also seen as an obstacle by many dealers and designers. As one of those polled ex- plains, "[One of our greatest challenges is] having enough time to be owner, bookkeeper, marketer, networker, etc." Another points to "time manage- ment due to not enough manpower as a result of lower proft margins" as a key challenge. Other commonly cited business challenges included "determining how to best market the business," "fnding and keeping good employees" and "keeping up with the wide variety of products available." 38 | Kitchen & Bath Design News | May 2015 Survey 5. PERCENT OF K&B; SHOWROOMS CARRYING KITCHEN PRODUCTS 6. PERCENT OF K&B; SHOWROOMS CARRYING BATH PRODUCTS 91% Vanities 89% Decorative Hardware 78% Sinks & Faucets 65% Storage & Organizational Features 58% Bath Accessories 55% Lighting 42% Shower Systems & Tub Enclosures 32% Bath Heating/Ventilation 30% Soaking or Jetted Tubs 24% Freestanding Tubs 11% Saunas or Steam Baths Source: RICKI 97% Cabinets 95% Countertops 94% Decorative Hardware 83% Storage & Organizational Features 79% Sinks & Faucets 63% Lighting 59% Flooring 52% Ventilation/Hoods 43% Refrigerators 43% Cooktops 42% Dishwashers 41% Stoves/Ranges 35% Wall Ovens 33% Wine Refrigerators 23% Induction Cooking Appliances 16% Steam Ovens Source: RICKI 7. SHOWROOMS PLANNING TO ADD KITCHEN DISPLAYS IN THE COMING YEAR 8. SHOWROOMS PLANNING TO ADD BATH DISPLAYS IN THE COMING YEAR 49% Yes 16% Maybe 35% No Source: RICKI 32% Yes 22% Maybe 46% No Source: RICKI

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