Are you projecting that your sales this year will be about the same as last? If so, your assumption is right in line with that of the Joint Center for Housing Studies of Harvard University. Its latest report, issued last month, concludes that remodeling industry sales may be up slightly for 2012, provided the year's last two quarters “end on a positive note.” Which is what JCHS expects will happen, based on recent housing sales and a less-restricted credit environment. According to JCHS economist and managing director Eric Belsky, “the housing market is finally starting its slow recovery.”
If that prediction sounds hesitant, a more convinced reading comes from Ian Shepherdson, chief U.S. economist at High Frequency Economics. The Wall Street Journal quotes Shepherdson as saying (about an upturn in housing sales): “This is not another false dawn; it's the real deal.”
Of course, after three years of economic doldrums, you may not be inclined to believe the predictions of others or be up for making any yourself. You may have concluded that no matter what anyone says about the economy, a company's performance depends, in large measure, on what executives do to manage that business. That's a lesson all recessions teach.
There are some home improvement companies — the rare handful in each market — that have grown during the last three years. Either they reached out to new market segments or they took business that might otherwise have gone to less aggressive competitors. Generally, those companies did one or more of three things:
1) Stepped up the level of communication with customers to generate additional referral or repeat business;
2) Doggedly went on setting marketing and sales goals as if the recession was just a temporary inconvenience;
3) Adopted unorthodox tactics or practices that made their marketing, sales, installation, or admin efforts more efficient and effective.
If those companies are doing well now, they will probably do even better when a few solid quarters of growth show that the downturn has actually been reversed.
But when industry sales rise, two things that changed in the last three years will likely stay with us: Homeowners who became more frugal will remain that way, continuing to demand the best possible job for their dollars; and no one will ever again believe that the value of real estate never decreases.
Editor
