EVANSTON, IL — Business for kitchen and bath design firms remains robust, and is projected to continue on an upward trajectory, as the impact of COVID-19 recedes and remodeling demand continues at record levels. But despite the bullish forecasts, dealers and designers remain hamstrung by several significant challenges – most prominent among them rising product costs and lingering disruptions in the kitchen/bath product supply chain.

Those are among the key findings of a major new survey conducted on behalf of Kitchen & Bath Design News by its exclusive research partner, the Research Institute for Cooking and Kitchen Intelligence (RICKI). The nationwide survey, conducted in mid-May, involved nearly 250 kitchen and bath dealers and designers, including those at firms that maintain a showroom as well as those who operate independently.

KBDN’s survey findings mirror those of other recent polls, which have found that demand for kitchen and bath remodeling is at an all-time high as COVID-19 vaccinations continue, previously postponed projects resume, and both permanent and hybrid work-from-home lifestyles prompt homeowners to reconfigure their residences. However, even as the pandemic’s impact continues to dissipate, project backlogs are reaching upwards of three to six months due to supply chain delays resulting from a combination of record demand and factory closures in the initial stages of the pandemic.

By far, the two greatest challenges that dealers and designers say they currently face are rising product/material costs (82% of respondents) and longer lead times on product deliveries (81% of respondents). Some 54% of survey respondents report that they cannot easily access installers, subcontractors or other labor needed to handle the projects they sell, while other challenges pale by comparison.

Among the wide range of kitchen and bath product categories, supply chain disruptions are most severe in the cases of appliances and cabinetry, survey recipients say. And most surveyed dealers and designers believe that the supply chain disruptions won’t end anytime soon. Specifically, 50% of surveyed dealers and designers believe the disruptions will continue throughout 2021. Another 20% anticipate the disruptions will last only through this fall. On the other hand, a significant number (17%) believe the delays will persist into 2022, and 6% say they have “no idea” when the disruptions will end.

Other survey findings included the following:

• Three in four dealers and designers polled by KBDN report that project requests are currently higher than they were a year ago, when the impact of COVID-19-was far more pronounced. More specifically, 26% of those surveyed say requests are much higher, while 48% say they are somewhat higher. In contrast, only 5% say project requests are somewhat lower, and another 5% say they are much lower.
• Two in three dealers and designers surveyed say they expect to design and sell more kitchens in 2021 than they did in 2020, when the median number of kitchens completed was 14, with designers and dealers associated with a showroom completing significantly more than independents (an average of 31 versus 6). The average price for a complete kitchen remodel in 2020 was $49,700, with independents reporting a higher average price tag ($64,700 versus $44,000) than those associated with a showroom.
• More than half the survey respondents expect to design and sell more baths in 2021 than they did in 2020 when the median number of baths completed was nine, with designers and dealers associated with a showroom completing significantly more than independents (an average of 18 versus 6). The average price for a complete bathroom remodel in 2020 was $26,400, with independents again having a higher average price ($32,300 versus $23,500) for those associated with a showroom.
• Half the surveyed dealers and designers anticipate that their 2021 profit margins on the kitchens and baths they design and sell will increase compared to 2020. Half say project pricing is more important now compared to this time last year, while 43% say the importance of project pricing is currently about the same as in the past.

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CAMBRIDGE, MA — As the U.S. economy continues to recover from the impact of the COVID-19 pandemic, households that weathered the public-health crisis without financial distress are snapping up the limited supply of homes for sale, pushing up prices and further excluding less affluent buyers from homeownership. At the same time, millions of people who lost income are behind on housing payments and on the brink of eviction or foreclosure.

Those are among the key findings of The State of the Nation’s Housing 2021, a major new report which concludes that, while government policymakers “have taken bold steps to prop up consumers and the economy, additional government support will be necessary to ensure that all households benefit from the expanding economy.”

The State of the Nation’s Housing 2021 report, released last month by the Harvard Joint Center for Housing Studies, found that even before the pandemic, household growth in the suburbs and small metros was on the rise, and the pandemic helped accelerate that growth, particularly among younger households who were ready to own homes and were looking to work remotely.

In 2020, existing home sales rose 6% and new single-family home sales jumped 20%, putting total home sales at their highest level since 2006, despite historically tight supply. But the combination of robust demand and limited supply lifted home prices to their fastest pace in over a decade.

“These outsized increases have raised concerns that a home price bubble is emerging,” said Daniel McCue, a senior research associate at the Cambridge, MA-based Harvard Joint Center for Housing Studies. “But conditions today are quite different from the early 2000s, particularly in terms of credit availability. The current climb in prices instead reflects strong demand amid tight supply, aided by record-low interest rates.”

“For those households with secure employment and good-quality housing, their homes provided a safe haven from the pandemic,” said Chris Herbert, managing director of the Joint Center. “But for millions struggling to cover the rent or mortgage, their housing situations have become increasingly insecure, and these disparities are likely to persist even as the economy recovers, with many lower-income households slow to regain their financial footing.

“Policymakers must be attuned to the needs of those who have fallen even further behind, ensuring that they also benefit from the expanding economy,” Herbert said.

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ALPHARETTA, GA — CEDIA Expo, the platform where technology integrators, designers and construction professionals connect, learn and engage, runs September 1 to 3 at the Indiana Convention Center in Indianapolis, IN. The leading residential technology event brings over 10,000 home technology design and construction attendees together with 300+ exhibitors at one of the first 2021 in-person events supporting the technology sector.

“We’re all eager to connect again on a human level and get back to face-to-face events as we celebrate everything we value as a community together again,” said Emerald Group Vice President, CEDIA Expo & KBIS, Jason McGraw.

CEDIA Expo is committed to making both new and established attendees and exhibitors feel connected and engaged by creating fresh programming, show floor activations, education, and training events in a safe, comfortable environment, show organizers noted.

New exhibiting brands include Environmental Lights, a leader in LED lighting solutions; Hisense, a fast-growing consumer electronics and appliance manufacturer that offers cutting-edge televisions and home appliances, and Datum Project Processing, a new to the market and show exhibitor that is participating in the rebranded Launchpad (formerly Innovation Alley).

Crestron, one of the leading complete, engineered smart home systems companies, is also returning to the main show floor. “We have been thrown into this global experiment,” said Crestron Exec. V.P., Global Marketing Brad Hintze. “We’ve had to innovate as a company, but so have our customers and partners throughout this year. It’s been an amazing experience and we’re excited to be back at CEDIA Expo to share our newest innovations and insights.”

DataComm Electronics, an industry-recognized brand name and a leading manufacturer of home theater and HDMI accessories and data/telecom connectivity solutions, also joins CEDIA this year. “I’m looking forward to the in-person CEDIA event in Indianapolis this year,” said Cassidy Jones, president of DataComm Electronics. “We have some new concepts to introduce, and the products really shine when we can talk about and demo them face-to-face.” Jones continues, “It’ll be nice to catch up with the customers and other exhibitor friends we missed in 2020.”

For registration details, visit https://cediaexpo.com/attend/registration-pricing/

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CHICAGO – SEN Design Group, a kitchen and bath industry buying group and business education resource, is accepting registrations for its Business School, to be held in-person at theMart (formerly known as Merchandise Mart) in Chicago. The four-day event – scheduled for July 12-15 and sponsored by Custom Wood Products – empowers business owners and executives in the kitchen and bath industry with the right tools to grow their businesses, according to SEN.

“The Business School is the kitchen and bath executives’ opportunity to move the needle in their organizations. It’s a truly transformational, poignant program that brings industry executives to the next level,” said Dan Luck, SEN Design Group’s senior v.p. “The program covers critical topics to maximize returns, master financials, leverage marketing strategies, improve personnel relations and implement proven methods to quickly and profitably grow kitchen and bath businesses.”

Participants will develop strong strategic planning skills and learn how to manage the business financials, build a successful commission system, learn how to forecast sales, create an effective pricing formula, increase profits, build a powerful sales team, win bank financing requests, develop a three-year budget and more.

But a successful business cannot rely solely on financial and business skills. Kitchen and bath business owners must also advance their personnel management skills, which is why the Business School includes a module dedicated to helping participants motivate and lead employees effectively.

The third day of the intensive program will focus on how to leverage marketing strategies to grow the business. This module will cover strategies to stand apart from the competition, the importance of creating a marketing plan, how to effectively use customer relationship management (CRM) tools, how to implement digital marketing campaigns and creative data-driven analytics to generate more leads.

Visit here to see the Executive Business School program and email Skyler Ille to register for the event. The cost to participate is free for SEN Design Group members and $1,195 for non-members; $995 Early Bird registration by June 30th, 2021.

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RESTON, VA — Major domestic kitchen cabinet and vanity manufacturers continued to post strong sales gains through the first five months of 2021, as demand remains at record heights and the impact of COVID-19 continues to dissipate, according to the latest in a series of monthly surveys by the Kitchen Cabinet Manufacturers Association.

The KCMA’s latest “Trend of Business Survey” reflected a year-to-date sales increase of 21.6% through May when compared to the same five-month period last year. Custom cabinet sales through the first five months of 2021 were up 23.5% over the same period last year, while semi-custom cabinet sales rose 21.3%, and stock cabinet sales gained 21.4%, the Reston, VA-based KCMA said, adding that overall May sales were up 32.9% compared to the same month last year.

Survey participants include stock, semi-custom and custom companies whose combined sales represent approximately 75% of the U.S. kitchen cabinet and bath vanity market, according to the KCMA.

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Europe’s kitchen retail specialist Wren Kitchens has launched its third U.S. showroom, this one located in Levittown, NY, bringing its total number of branches to 108 across the U.S. and the U.K.

The kitchen remodeler opened the biggest ever kitchen showroom in Milford, CT last November and its expansion plans will continue with the opening of showrooms in Selden, NY and Lawrenceville, NJ in the coming months.

The brand-new Levittown showroom at 2993 Hempstead Turnpike has created a significant jobs boost to the local area, with 30 new roles in retail. In addition to this, it’s created a further 30 jobs across manufacturing and logistics at its state-of-the-art headquarters in Wilkes-Barre, PA, where all Wren kitchens are made to order for its U.S. customers.

All under one roof, the new 19,500-sq.-ft. showroom has 61 full-sized kitchens on display, as well as various cabinet styles, colors, appliances, storage solutions, countertops, sinks, faucets, accessories and much more.

“The state-of-the-art showroom is a one-stop shop for everything that kitchen remodelers need to transform their kitchen space,” notes James Langdon, Wren Kitchens Levittown design manager. “We pride ourselves in offering quality luxury kitchens at affordable prices, and all of our kitchens are designed and made by us in the USA.”

At the heart of the showroom are two virtual reality studios where customers can use VR headsets to view their kitchen in 3D. It also encompasses two dedicated interior design suites that are free to use for local designers and architects to work with clients. Sessions can be booked by calling or visiting the showroom.

There are 16 design desks where customers work with expert designers to create their dream kitchen. They have L-shaped sofas and a large screen for customers to watch their dream kitchens come to life in 3D.

A child-safe kitchen is on display at the showroom, and it features design tips to keep children safe, such as door safety catches and locks, appliances located out of reach, cool-to-touch induction hobs and storage ideas for cleaning products.

Wren has invested $15.4 million in its 252,000-sq.-ft. facility in Wilkes-Barre, PA, and is transforming its onsite headquarters to provide support for showrooms across the East coast. Wren has also invested in its own fleet of trucks for delivery across the country.

All of Wren’s showrooms are pet and child friendly with play zones, baby changing facilities, a stroller park and a relaxing coffee area.

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LE SUEUR, MN — U.S. Customs and Border Protection has determined in a preliminary finding that two Chinese importers of quartz surfaces have allegedly evaded antidumping and countervailing duties imposed by U.S. trade officials, according to Cambria Company LLC.

The Le Sueur, MN-based Cambria, the leading domestic supplier of quartz surfaces, said that the pair of importers were found in violation of trade sanctions by misclassifying the products in question as “crushed glass,” which is outside the scope of the AD/CVD orders. U.S. Customs now has seven months to continue its investigation and determine appropriate penalties.

“This announcement by U.S. Customs confirms that there are U.S. importers who are falsely claiming that their quartz surfaces are not covered by the AD/CVD orders because they are “crushed glass” surfaces,” said Marty Davis, president and CEO of Cambria. “By making these false claims, unscrupulous importers continue to import Chinese merchandise without paying the applicable AD/CVD duties.”

Other importers evade the AD/CVD duties, Davis charged, through trans-
shipment of Chinese merchandise through third countries before entering the U.S. without payment of the duties.

“The industry should now know that U.S. Customs and Cambria are fully aware of the ways that importers are undermining the AD/CVD duties that were imposed to stop illegal trade violating U.S. trade law and level the playing field for American companies like Cambria,” Davis said.

“Additional research by Cambria has revealed that a significant portion of the merchandise being imported from China as ‘crushed glass’ surfaces is actually covered by the scope of the AD/CVD orders,” Davis said, vowing that Cambria “continues to work with U.S. Customs to identify and hold responsible any foreign exporters and U.S. importers that are evading the AD/CVD duties through this or any other evasion scheme.”

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The nation’s housing, residential remodeling and kitchen/bath markets each continued to respond to post-COVID realities as 2021 enters its final months and the impact of the global pandemic dissipates. Among the key statistics and forecasts released in recent weeks by government agencies, research firms and industry-related trade associations were the following:

HOUSING STARTS & NEW-HOME SALES

Continuing a trend from the beginning of 2020, low-density, low-cost markets continue to outperform other regional geographies with respect to home construction, according to the National Association of Home Builders. “With the shift to telework brought on by the COVID-19 pandemic, housing demand continues to show the strongest gains in lower-density markets as people have flexibility to live outside some metro areas,” said Chuck Fowke, chairman of the Washington, DC-based NAHB. “As workplaces increasingly adopt hybrid work models, renters and buyers will have increased (need) to minimize travel times and reduce both housing and transportation cost burdens,” noted NAHB Chief Economist Robert Dietz, adding that homebuilding is expanding most rapidly in locations with the shortest commuting times.

EXISTING-HOME SALES

Although housing supply continues to fall short of demand, additional inventory is expected to enter the market later this year as further COVID-19 vaccinations are administered and the number of homeowners in mortgage forbearance continues to decline, according to the National Association of Realtors. Although housing demand is still strong compared to one year ago, existing-home sales have lagged in recent months, the Washington, DC-based NAR reported, noting that total housing inventory was down more than 20% from a year ago. Despite the recent lag in sales, however, “the additional supply projected for the market should cool down the torrid pace of price appreciation later in the year,” NAR Chief Economist Lawrence Yun predicted. Total existing-home sales were pegged at a seasonally adjusted annual rate of 5.8 million units, up 44.6% from a year ago, according to the latest figures. “Home sales are now approaching pre-pandemic activity,” observed Yun. And although a lack of inventory continues to be the overwhelming factor holding back home sales, the outlook, Yun said, remains “encouraging.”

CABINET & VANITY SALES

Major domestic kitchen cabinet and vanity manufacturers continued to post strong sales gains through the first five months of 2021, as demand remains at record heights and the impact of COVID-19 continues to dissipate, according to the latest in a series of monthly surveys by the Kitchen Cabinet Manufacturers Association. The KCMA’s latest “Trend of Business Survey” reflected a year-to-date sales increase of 21.6% through May when compared to the same five-month period last year. Custom cabinet sales through the first five months of 2021 were up 23.5% over the same period last year, while semi-custom cabinet sales rose 21.3%, and stock cabinet sales gained 21.4%, the Reston, VA-based KCMA said, adding that overall May sales were up 32.9% compared to the same month last year. Survey participants include stock, semi-custom and custom companies whose combined sales represent approximately 75% of the U.S. kitchen cabinet and bath vanity market, according to the KCMA.

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