High-End Kitchen and Bath Dealers Feeling High About 2000

High-End Kitchen and Bath Dealers Feeling High About 2000

High-end kitchen and bath dealers, for the most part, had a good year in 1999, and are expressing feelings of optimism about 2000, according to telephone surveys conducted by Kitchen & Bath Design News.

"The economy is extremely good, there's a lot of money around and [consumers are] putting it to use they want luxuries they can live with," observes Glenn Brody, CKD, of the Bronx, NY-based Kitchen Solutions, whose very high-end, appliance-focused business serves New York's Westchester and Long Island areas, as well as Manhattan.

"We're usually slow this time of year, but we're extremely busy right now," says Brody, who has added two new staff members a computer-oriented order processor and a salesperson to meet demand.

"I had a very good year," echoes Jeani Lee, owner/design consultant for Kitchen Bath & Home, in Ames IA, adding that she is forecasting a 10% sales gain this year over 1999. Lee reports she frequently turns down work, but has no interest in expanding her operation. "That's a nightmare," she laughs. "I've already been that route."

"We're a little behind our sales projections, but we still had a good year," reports Joe McDonald, owner of Joe McDonald's House of Cabinets, in Mount Pleasant, MI. He blames new local competition a new retail kitchen and bath outlet and a Home Depot for his less-than-expected revenues. He anticipates a flat year in 2000, but will be more aggressive in his advertising and in participating at an area home show.

Mary Sadinsky, president of Kitchen & Bath Specialist Inc., in Van Nuys, CA, also said her firm had a good year in 1999, with 2000 projections staying at their '99 level.

Strategies vary
Dealers' interviewed by K&BDN say their strategies for success vary. Lee, for example, credits her success to the fact that many of her high-end clients who move out of state contract her to do their new homes, enabling her company to handle projects in Arizona, Colorado and other states. Her work centers primarily on kitchens and baths, but often expands to other rooms, and allows her to only do high-end work.

Brody, whose company is also focused on the high end, attributes his success to his ability to offer upscale product lines like SieMatic, Rutt and Sub-Zero, which are in high demand but are offered by only a few dealers in his area.

When the market is down, it takes somewhat longer to close a deal, Brody notes, but the balances come in as soon as the market takes an upswing. Interest rates don't worry him that much. "I think there's going to be a momentum for at least the next couple of years," he believes. "Most people I know in the industry are very bullish."

Sadinsky actually considers a raise in interest rates a plus. "If people aren't buying new homes, they're remodeling the homes they've got, and doing additions," she explains.

All the dealers surveyed report empty nesters in their 40s and 50s as their most frequent clients, though Brody also cites a younger group of people looking to remodel their Manhattan condos. Younger clients in the suburbs tend to be more interested in lower-priced lines, he adds. Older Manhattan customers are often looking to combine several apartments into one huge condo. Lee cites people in their 50s looking to make extensive renovations to their existing home as her primary customer base; sometimes, she does new construction projects, but only when working directly with the client.

Sadinsky doesn't believe the do-it-yourself market has affected her business, which is in an area vulnerable to DIY, and includes a significant number of cabinet-refacing jobs.

"Everyone reports a mix of jobs inspired by necessity or a desire for luxury. But Lee emphasizes that a "keeping-up-with-the-Joneses" mentality is not among her clients' chief motivations. "I don't think they're considering what anyone else thinks," she comments. "They're making their life more convenient or pampered. They're doing exactly what they want." Daina Darzin

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