January 2006 Market Pulse

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“Our business was up considerably last year, so we are pretty encouraged about 2006. Retail remodeling, for instance, is doing very well in this market. Therefore, we are planning to launch some new advertising campaigns in 2006 and a lot of it is directed exclusively at the remodeling and retail market. We are seeing more people spending money, buying better products and upgrading things. Therefore, we are definitely going to be more aggressive this year. We are also almost finished remodeling our showroom and we should have that pretty much wrapped up before K/BIS. Last year, we had more of a ‘wait-and-see’ attitude. We started feeling positive about it midway through 2005, so we’ve become more upbeat about the market.”

Don Cochran, President
Warehouse Cabinets
Brecksville, OH

“I do not abide by statistics that say whether the economy is improving or not. It’s not immediately reflected in how my business is doing. My clients don’t seem to change their decisions much, either. Over the years, my clients have tended to be pretty consistent with the types of projects and the budgets they were doing. As an independent designer, I don’t have a showroom or overhead that I have to be terribly worried about. Overall, I tend to play things pretty conservatively, especially because the Chicago market has been going through a boom in terms of real estate [which may or may not last].”

Rebekah Zaveloff, CKD, Principal,
KitchenLab
Chicago, IL

“We have already seen a surge in the economy and we certainly feel that it will impact the way that we deal with our clientele. For example, we have gotten much busier because there is more money in the economy and we have to figure out how to manage our workflow better. Specifically, I think it will impact how we communicate with our architects and builders – especially when it comes to understanding the scope of the work and things like time frames and scheduling. I wrote a letter to an architect just yesterday asking how we can better work our system out and manage our time better. Our approach has been prompted by the amount of business and leads that we have begun to receive. This is definitely a departure from our approach in previous years because now we are initiating conversations with people and trying to work out time frames. A lot of times in the past, we would work on projects that were half a year out. But now, if a client comes in and wants a kitchen by Christmas, it will absolutely affect how we prioritize things. We have been told by clients that we are pretty efficient, but I always think there is room for improvement.”

Barbara Bell, Interior Designer
Eastern Kitchens and Baths
Broomall, PA

“I think that improvements in the economy will help us with the interest rates, especially if they remain low. The other thing is that people will have more access to money as well, which means that more projects will be done. The work force, especially here in Michigan, has to be increased, if that happens. We are taking our time to make changes, although we have just expanded our showroom a bit. The most important thing for us is to simply ‘go with the flow,’ particularly because the trends that we see so often, such as what is seen in magazines, are what set the pace for people as they move forward.”

John DeGiulio, General Manager
DeGiulio Industries
Dearborn, MI

“I would say that my price points are at a threshold that hits the income of the consumers in this area, so I do not anticipate making any changes.

My advertising is maintained through some local high-end magazines and through the Internet. Actually, the Internet serves as my main showroom. I don’t have a public, ‘brick-and-mortar’ showroom and I don’t plan to any time soon. The reason is that there is a whole different level of responsibility that comes with running a showroom. When you have a studio instead of a showroom, you do not have to be tied to your office. Another consideration is that I am also a dealer of four different cabinet lines, so when selling those cabinet lines, I bring the doors with me to a client’s house. This way, they can readily see what is available. This has worked out quite well for me. My goal, however, is to purchase some property and have a studio where clients can visit and come over for appointments. In years past, I also didn’t rely on the Internet as much as I do now. Back then, we relied more on word-of-mouth referrals. Now, we can reach a broader segment of our target clientele by utilizing the Internet. So I would say that changes in the economy have had a huge impact on our business.”

Elizabeth Sturman, Owner
EAS Design, LLC
Kirkland, WA

“I don’t think that changes in the economy will really impact my business decisions, but it will impact and improve the results of my business decisions. However, it may impact my business decisions in the sense that if the economy improves, I will probably back down a little bit on my marketing strategy. For instance, I will probably not spend as much time and money on marketing if the economy and the business flow remain consistent. Our business strategy is usually set up six months to a year ahead of time, so the actual strategy and business planning don’t change drastically with any market fluctuations – other than regarding the amount we spend on advertising. As I sense the market softening, I tend to increase my advertising budget so that I can try to draw more people in – even if there are less of them out there purchasing. If the market appears to be improving, I am going to proceed faster with our showroom plans and increase the number of models in our showroom. [I firmly believe that] if the economy improves faster, the positive results on my business will come faster. So, the way I look at it is that positive changes in the economy don’t change the strategy, but it does change the time line of our approach.”

Jeff Lendwehr, Designer
Goldenwood Cabinetry
Becker, MN

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