Perseverance Keeps Leaders on Track

Remodeling, like any business, has its ups and downs. Most remodelers would acknowledge recent history has been one of the downs. Those who talked to Qualified Remodeler are among a select group of survivors and innovators who have always persisted through difficult times.

In part, they've survived by fine-tuning their sales and marketing or by changing their mix of products and services to meet customer demand or maybe being in the right place. None of them pretend there is a magic bullet or a single solution that works for everyone. They just know what has worked for them.

Normandy Builders in Hinsdale, Ill., reports that business is up significantly year-to-date. Andy Wells, vice president and general manager, attributes that to improved market conditions and more effort on his company's part. ";It feels like the consumer has loosened up a little bit," he says. ";I think people may feel a little better about job security, which I think was a lingering doubt for a lot of people."

Things may not be returning entirely to pre-recession norms, however. ";There are a couple of big things we've noticed," Wells says. ";One is definitely the mix of jobs has turned to fewer additions and to more remodeling. We are still doing add-ons, but there are a lot more inquiries for kitchen or bath remodeling. I think that's a result of people feeling that they can't sell their homes, so if they're going to stay they want to make it how they want it.

";Financing has become very difficult, partly because of low appraisals. People are spending their own money, so they're being much more sensitive to the dollars they're spending. It's coming out of their pockets vs. out of home equity."

Home equity will return, Wells says, as soon as the foreclosures and short sales are done and the demand for homes starts to rise again. ";How long that will take, nobody knows," he adds.

Normandy has turned to a grassroots marketing and advertising campaign to deal with a difficult market. ";We're going out to meet the public, whether it is home shows or seminars in our showroom or in alliance with partners. We're not just showing them an advertisement and hoping they'll be interested in us."

Competitive changes

Another change that some remodelers have noticed is a change in competition. ";There is a great deal of low-end competition from people who are just jumping into the remodeling market and probably don't have a real strong handle on their costs or about what's necessary to provide for customer satisfaction," says Neil Harvey, president, residential division, Francis Harvey & Sons Inc., Worcester, Mass.

";That said, we're fortunate in that almost 70 percent or our business is repeat or referral, so that has helped protect us when there is the lure of low cost; people still recognize value," he says.

Consumers aren't wondering as much where the bottom is, Harvey remarks. ";People recognize that there seems to be a floor under us. There is jitteriness, but people who are employed realize their life is continuing on. They may be more cautious about how involved they get, but they are moving forward. There is a whole lot of remodeling happening."

Jobs are smaller

Jobs, however, are getting a little smaller and more conservative. ";Some of the bells and whistles are missing now," Harvey says. ";We're seeing less of the big ticket jobs, although they seem to be coming back a little."

Homeowners are coming to realize that bigger is not always better. ";They value intelligent design and realize that quality can have a greater payback than big," he says.

Coping with a tough economy has been at the top of the list of things that every remodeler has had to deal with. ";I think whenever you run into the headwind of a difficult economy you need to make sure that you execute as well as possible in all areas related to your sales and marketing," Harvey says. ";We've reacted to market conditions and reduced our labor costs as well," he adds.