Finding the Peaks in a Level Market
Nancy Davis spared little expense when she remodeled her kitchen last year.
The Indiana homeowner treated herself to euro-style laminate/almond cabinets with oak trim, a work station with an oak back and teal countertops.
Davis is like many consumers, according to Gerald Johnson, president of the National Kitchen and Bath Association (NKBA), Hackettstown, N.J.
“When they replace cabinets and vanities, they want better-quality, high-end products,” he says.
The 1991 Trends Survey, just released by the NKBA, reveals that between one-fourth and one-half of money spend on kitchen and bath projects is spent on cabinets. The trend toward luxury kitchens and baths has made a big impact on retailers’ margins in cabinets and vanities.
Dave Fultz, buyer for Ace Hardware Corp., Oak Brook, Ill., says Ace dealers are selling opening price point vanities. “We’re selling more combo vanities with tops,” he says. But Fultz cautions that marketing upscale cabinets and vanities isn’t for everyone. “We are seeing a move toward upscale, but it has yet to really hit middle America.”
He suggests retailers take a close look at their market before investing in high-end lines. “While whitewash look and champagne finish look good in the showroom, these products don’t always move well.”
“Don’t get into that niche unless you plan to display a lot of products. You can’t just display two SKUs and sell a lot. It takes time to cultivate that market.”
NKBA’s Johnson, also a certified kitchen and bath designer, echoes Fultz. “We sell what we show,” says Johnson. “Of course, it is much better to display the products that you think will sell.” Retailers and buyers report that a full investment in merchandising and a close eye on what customers want is needed to establish a strong stance in selling cabinets and vanities.
Merritt’s Hardware in La Puente, Calif., makes that investment. The store displays vanities of all different styles, colors and price points, and makes a 25-percent average margin on the products.
Roger Scott, manager of Delta Do-it center in Kingsford, Mich., displays 1,200 square feet of cabinets and vanities in six kitchens and 12 full accessorized bathrooms.
For Scott, oak is still the strongest seller, while some customers opt for hickory. He has seen some European influence and says more customers are asking for almond trimmed in oak.
In November, the Kitchen Cabinet Manufacturers Association, Falls Church, Va., projected a leveling off of cabinet demand for 1991, with a slight decrease in demand for new construction being offset by a modest increase in demand for cabinets used in repair and remodeling.
Aggressive marketing and merchandising is key to getting your share of the remodeling dollar. Johnson suggests that retailers do some sleuthing to determine what will sell in their market. “Go to your competitors’ stores and see what is selling. Look at the NKBA survey (see results in chart), ask builders remodelers and contractors what their customers are asking for.”
Johnson also suggests interviewing customers extensively about their needs.
“Ask them exactly what they plan to use the space for,” Johnson says. “If it is to be a storage and grooming area, you might want to design with a vanity with deep drawers for bottles to stand up in, as well as shallow drawers for cosmetics.” Some consumers want electrical outlets designed around cabinets for hair dryers.