According to recent surveys by the Home Improvement Research Institute (HIRI), Principia, and other analysts, the home improvement industry is starting to grow once again, hopefully for good this time. Over the last 6 years, professionals have watched as clients have closed their doors and their wallets to new renovation projects. Our home improvement experts managed to survive the recession by adjusting their strategies and finding creative solutions.
Securing New Leads
No matter what the economy is doing, professionals need to strike a balance between completing jobs for revenue and building new leads through marketing and networking. When the recession began, professionals that would ultimately be successful switched their focus to marketing campaigns.
Designer Alan Hilsabeck writes,
“I began marketing heavily, but this time online with as many free opportunities as possible; anything to keep our name ‘out there’.”
By maintaining contact with existing clients and generating name recognition, Hilsabeck was the first person clients would call when they were ready to start on a new project.
Even for successful professionals, the recession was a period of severe adjustment. One of the most common changes was shifting to related fields that were not as affected by the recession.
Tanya Stock of Vida Verde recalls,
“I dramatically changed my business to move out of residential remodeling and into consulting, research, coaching and advising.”
Tanya took her expertise in green remodels and applied it to a different line of work. Consumers tackling their own green projects hire Tanya to advise them, resulting in professional grade projects that mitigate the cost of a full remodel team.
Cutting costs was something that both consumers and professionals had to consider heavily for the hardest parts of the recession.
“We began extensive cutbacks. Slow on the trigger, but we managed to cut back from insurance to trash haulers. Anything and everything was on the chopping block. This made us lean in all our operations. We will continue running a leaner business model and implementing the efficiencies we developed in this time.”,
reported Sam Lazarus of ServiceMaster by Best
Other professionals made adjustments that hit closer to home.
Electrical Instructor Terry Ferguson commented,
“The recession has forced me to reconsider vacation plans for this summer and depending upon the price of gasoline, maybe just start building an electric car.”
Make Money by Saving Money
The biggest source of income for many of our experts was found in industry niches dedicated to remodels and home improvement projects whose ultimate purpose was to save the homeowners money, like energy efficient upgrades.
Neal Walsh from Aeroseal notes,
“Thanks to recent articles by the U.S. Department of Energy, This Old House magazine and others, homeowners are learning that internal aerosol duct sealing is often the most impactful thing they can do to increase their monthly utility bill. As a result, many of our Aeroseal service providers are finding that the recession has shifted customer demand for duct sealing.”
Now that the worst is over, many professionals are looking ahead, wondering what the next few weeks, months, and years will bring in terms of business growth. A recent article in Forbes magazine highlighted the growth and positive future of the home improvement industry.
“Sales among privately held building contractors who specialize in many of the types of jobs that are typical for home improvement – painting, flooring, tile work, cabinet-building – have increased nearly 14 percent over the last 12 months.”
The article was based on information from financial information company, Sageworks Inc. Their graph, featured below, compares the growth rates of finishing contractors and residential building construction.
Such growth is expected to occur for a variety of reasons. Overall increases in consumer confidence should prompt many homeowners to begin putting money into their house, making up for equity lost during the housing slump. Many homeowners are choosing to remodel their existing homes because they simply cannot afford to move, explaining why the home improvement industry has grown at a greater recovery rate than new construction projects. Finally, the cutbacks and leaner business models that were created as a result of the recession have made many home improvement projects more cost-effective, using creative solutions to accomplish the same projects.
With smarter consumer spending and more efficient building procedures, home improvement professionals should see their business sales climb to pre-recession levels and beyond within the coming years.