Overall Kitchen and Bath Spending Projected to Total $158.6 Billion in 2021 The National Kitchen & Bath Association (NKBA) today released its 2021 Market Outlook report, revealing the industry is poised for continued growth with overall spending for both kitchen and bath projects to increase in the coming year. The industry anticipates a pronounced rebound Read more
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Overall Kitchen and Bath Spending Projected to Total $158.6 Billion in 2021
The National Kitchen & Bath Association (NKBA) today released its 2021 Market Outlook report, revealing the industry is poised for continued growth with overall spending for both kitchen and bath projects to increase in the coming year. The industry anticipates a pronounced rebound in overall industry growth-from -5.9% in 2020 to 16.6% in 2021, compared to 9% in 2018 and 1% in 2019.
Homeowners cite the kitchen and bath areas as two times more important than other spaces within the home, and the kitchen particularly gained status throughout the COVID-19 pandemic, with 70% of homeowners considering it extremely important compared to 64% prior to the crisis. With a renewed focus on these rooms, the industry projects a tailwind of big interior projects, including indoor kitchen remodels. This year may see a shift from the DIY boom of 2020 toward jobs that require a kitchen and bath professional, many of which may have been postponed by homeowners during the pandemic, due to health-risks associated with having someone inside the home.
“After such a strong year for home remodeling in 2020, some wondered if we were approaching a home improvement spending ‘cliff.’ We’re pleased to say that’s not what the kitchen and bath market is expecting in 2021,” said Bill Darcy, NKBA CEO. “Last year, homeowners started the work of improving their living spaces with DIY projects. And this year, with early distribution of the vaccine and other measures to reduce the public health impact of the virus, we expect to see continued renovations and more projects requiring our members.”
The study saw a number of project motivators and inspirations that continue to drive renovations:
- While larger, more professional-intensive projects are slated to increase this year, homeowners cited a desire to save money (25%), additional time to pursue projects (23%) and health and safety concerns (22%) as the primary reasons for recent DIY work.
- Households indicate that improving the home’s aesthetics are the main motivators for remodels in the bathroom (16%) and kitchen (15%), followed by maximizing quality and durability, and increasing the value of the home.
- Homeowners completing budget-friendly bathroom remodels focused on updating cabinets (52% of projects) and plumbing (43% of projects). Smart home products (57%) and water filtration systems (54%) were the focus of premium feature upgrades in the kitchen.
- Both household income and life stage jointly influence kitchen remodel cost considerations. “Mature households,” those age 45+ with no children, have the highest share of premium upgrades in their kitchens.
- Google searches and social media are the primary inspiration for kitchen and bath remodels. Households frequently indicate that they rely on more than one source to inspire a remodel. Young single homeowners or couples tend to more heavily rely on Google and Instagram, while mature adults (45+) put greater weight on other homes seen in person for inspiration.
Economic indicators that may impact remodeling activity include:
- A 10% growth in single family residential construction starts in 2020 will lead to new construction dollarizing in 2021, driving a +17% growth in new residential building materials.
- Spending on new construction represents 57% of the total residential kitchen and bath spending at $90.0 billion. Residential remodeling makes up 43% at $68.6 billion in spending.
- Approximately 1% lower mortgage rates than a year ago will continue to drive demand for homes across buyer segments.
- With a record low for-sale inventory, housing stock is set for price appreciation, which will serve to increase homeowners’ decisions to pursue large-scale remodels. The study forecasts an approximate 31% total house price appreciation between 2020-2023 driven by both the supply shortages and underlying demand.
Methodology
NKBA commissioned the highly regarded consulting firm John Burns Real Estate Consulting (JBREC) to field the study. The data presented in this report is compiled from a variety of sources: The U.S. Census American Housing Survey home-improvement projects microdata, National Apartment Association (NAA) spending (rental), and JBREC’s home improvement estimates and forecasts of single-family rental renovation spending. In addition, a survey was conducted among 4,732 among homeowners who had initiated a home improvement project since the start of the COVID-19 pandemic.
About the National Kitchen & Bath Association and the Kitchen & Bath Industry Show
The National Kitchen & Bath Association (NKBA) is the not-for-profit trade association that owns the Kitchen & Bath Industry Show® (KBIS), as part of Design & Construction Week® (DCW). With nearly 50,000 members in all segments of the kitchen and bath industry, the NKBA has educated and led the industry since the association’s founding in 1963. The NKBA envisions a world where everyone enjoys safe, beautiful and functional kitchen and bath spaces. The mission of the NKBA is to inspire, lead and empower the kitchen and bath industry through the creation of marketplaces, networks and certifications. For more information, visit NKBA.org or call 1-800-THE-NKBA (843-6522).
KBIS® and NKBA® are registered trademarks of the National Kitchen & Bath Association.
Showcasing Jones Stephens’ Full Line of Innovative and High-Quality Residential and Commercial Products. Jones Stephens has put the finishing touches on its 2020 Master Catalog, Volume IX, which is now available for download. Well-organized for ease of searching, the Master Catalog displays thousands of SKUs within 14 product categories, offering over 350 pages of products Read more
Showcasing Jones Stephens’ Full Line of Innovative and High-Quality Residential and Commercial Products.
Jones Stephens has put the finishing touches on its 2020 Master Catalog, Volume IX, which is now available for download. Well-organized for ease of searching, the Master Catalog displays thousands of SKUs within 14 product categories, offering over 350 pages of products for the residential and commercial markets.
Showcasing the broad range of items, the catalog includes, among many other categories, kitchen and bath repair products, plumbing specialties, fittings and valves, plastic and cast iron drains, and toilet seats. New PlumBite® push on fittings, insulation and gas connectors are also included! After examining the catalog and its vast array of products, customers will readily agree with the Jones Stephens’ slogan — “We Got It”!
Jones Stephens continues its leadership in the industry by offering customer friendly FFA’s and an unparalleled service proposition with LTL and small parcel orders shipping same day if orders are placed before 10:30 a.m. and 2:00 p.m., respectively. Jones Stephens continues to focus on making every transaction easy for its customers.
Printed catalogs are available for distribution through Jones Stephens’ rep network. For electronic download, please visit www.jonesstephens.com.
E-commerce solutions for the kitchen and bath industry are crucial for contractor suppliers. The right online solution must combine the complexity of business-to-business with the ease of consumer simplicity. It can enhance, develop and support customer relationships. But it involves the relentless pursuit of the exact mix of data, technology, training and support. In the Read more
E-commerce solutions for the kitchen and bath industry are crucial for contractor suppliers. The right online solution must combine the complexity of business-to-business with the ease of consumer simplicity. It can enhance, develop and support customer relationships. But it involves the relentless pursuit of the exact mix of data, technology, training and support.
In the end, it preserves old-school relationships, adds a new-school solution and becomes a tool to spur new business.
A Rich History of Relationships
Contractor supply has historically been a relationship business. Customers go to the supply house and develop face-to-face relationships with staff, who become more than just order-takers.
Tailoring the right online solutions for customers can maintain that personal touch and help everyone get their jobs done faster.
What Customers Want
Distributors are adapting to a changing buyer profile that expects online services – from requesting and checking quotes, to reviewing local inventory and pricing in real time, to placing orders quickly for scheduled delivery.
But e-commerce systems and personnel can do more than help current customers. They can help win new business.
E-commerce is more than just creating a shopping cart. It’s a complete digital transformation.
A Complex Transaction
It’s critical to get input from both customers and from every level of the supplier organization. At MORSCO, we listen closely to customers, as well as our inside and outside sales teams, operations, accounts payable and other internal stakeholders. All these parties must help develop the solution and train customers afterward. It becomes everyday business, not just a one-time project.
Keep it Personal
Even with stakeholder input from all levels, e-commerce can still seem impersonal. But with support from the staff at the local branches – particularly inside sales – and with communication from local contractors, the face-to-face support will remain. Orders and follow ups should go through the local branch – not a call center – so customers know they are still dealing with suppliers at the local level who understand their needs.
The right online solution also frees up time for the outside sales staff. With advanced features, like easy-to-use custom pricing and quoting tools, the outside team can better support new and potential customers. Instead of tracking down invoices and delivery slips, outside sales reps can leverage digital platforms to spark better conversations with customers, bringing sophistication to a centuries-old industry.
Suppliers in the kitchen and bath industry, meanwhile, can continue to serve as personal consultants, troubleshooters and more, all in a face-to-face capacity. That provides better, faster service, while maintaining an unmatched level of local, personal support for customers.
Benefits for Vendors
E-commerce sites can also serve as a vendor’s marketing tool, salesperson and cashier. Benefits include:
- Mobile solutions like phone and tablet access that help customers search for products and inventory at the local level and place orders anywhere, anytime, including on job sites.
- The ability to increase customer reach and become the preferred online vendor for customers.
- Increased sales and loyalty with existing and new customers.
The Right Solutions
So what does it take to offer world class e-commerce? Solutions that:
- Help people get jobs done more efficiently, freeing talent for higher-value tasks. Viewing and paying invoices can now be done online, much more quickly, and at the customer’s convenience.
- Allow access anywhere from desktop computers to job sites through mobile phones. Offer technical documents, catalogs, component and accessory information, as well as substitute items and recommendations.
- Include side-by-side input from customers and support from employees.
- Invest in training for all sales and branch staff, ensuring the face-to-face support can be seamless and add value.
- Offer support that involve local branches, which are critical for both your customers and your employees. Be sure users know the types of support offered and that support tickets are addressed quickly and completely.
- Leverage technology: Power your digital customer experience with top-tier e-commerce, search, marketing automation, analytics, and data platforms. At MORSCO, this gives customers the 24/7 access they need, increases our ability to make complex online transactions that vary by a customer’s needs and creates the customer value that goes beyond the online shopping cart.
E-commerce solutions must remember the importance of the long-standing relationship nature of the business. It’s an exciting time for those who can adapt.
Darren Taylor is a digital transformation marketing executive with a rare combination of market-centric strategy formulation skills, Fortune 500 operational experience, and a track record for driving commercial growth in early stage and large corporate environments. He currently serves as CMO for MORSCO, a leading U.S. distributor of commercial and residential plumbing, waterworks and HVAC, with branches and showrooms across the country. Taylor previously served as Director of e-commerce Strategy & Integration at W.W. Grainger, spearheading the company’s digital strategy and execution. Under his leadership Grainger became one of the top 15 eRetailers in the U.S. Taylor also serves as an Adjunct Professor in Northwestern University’s Masters of Information Technology Program and is a keynote speaker at many industry events such as CMOSummitt, DX Summitt and B2B Online. He also has be featured in INC. magazine and leadership books.