The Initial Impacts of COVID-19 – NKBA Research Findings
March 30, 2020
NKBA members are weathering the coronavirus storm as best they can, but the numerous impacts of a country under virtual quarantine and uncertainty over short- and long-term prospects for economic recovery – and most significantly, unknowns surrounding the health of the world – are taking an obvious toll on all business, including remodeling and home building.
NKBA fielded a survey from March 18 to 24 among members, including designers, building/construction professionals, manufacturers and retail/sales pros, to determine the impact of COVID-19 on the residential kitchen and bath business. The results, culled from nearly 1,000 respondents, provide a snapshot of member sentiments on the situation. The association will continue to monitor these sentiments periodically, including through research gathered in the quarterly Kitchen & Bath Market Index (KBMI), conducted in collaboration with John Burns Real Estate Consulting.
The average benchmark rating of COVID-19’s impact on business is 7.4 on a scale of 1 (no impact) to 10 (significant impact). Designers and building & construction pros rated the impact at 7.4, manufacturers reported the least impact at 6.8, while retailers were highest at 7.6.
What’s Impacting Design Pros
The four factors with the greatest impact cited by designers and builders are not surprising: 70 percent said customer desire to practice social distancing; 68 percent cited their own desire to practice social distancing; 65 percent pointed to customers’ financial uncertainty, and 62 percent said the need to take care of themselves and their families.
Wall Street’s plunge and the resulting disruption of many 401K plans, as well as rising unemployment, certainly contribute to clients’ financial uncertainty. Among designers and builders, 52 percent said they’re experiencing delays on current or upcoming projects, and 19 percent said they had some jobs cancelled.
Among retailers and dealers, 44 percent said some of their projects were delayed; 16 percent said some current or upcoming jobs had been cancelled.
The top factors impacting retail sales were consumers’ desire to practice social distancing, cited by 65 percent, while 61 percent cited the need to protect the health and safety of their workers. Consumers’ financial uncertainty was cited by 60 percent, and 57 percent cited their own desire to practice social distancing.
What’s Impacting Manufacturers
On the manufacturers’ side, worker safety and financial concerns topped the list. Some 67 percent cited the need to protect the health and safety of their employees; 66 percent said economic uncertainty was having a significant impact; 58 percent cited customers’ financial uncertainty, and 52 percent called out stock market volatility.
The top measures being implemented or considered to confront the threat mostly concern limiting contact with other people: 92 percent said they’re postponing or canceling large events; 87 percent cut back on trade show attendance; 81 percent have restricted employee travel; and 80 percent are encouraging telephone meetings or videoconferencing instead of face-to-face meetings. Additionally, 11 percent said they’ve already laid off employees.
Innovating During the Chaos
Although NKBA members are facing unprecedented challenges, many are responding with creativity, grit and determination, adjusting their business models, interacting virtually with clients to keep current projects moving and to cultivate new projects. Some are using video-chatting platforms to stay connected to clients.
“We’ve moved to zoom for all possible meetings,” said one designer. “When an in-person meeting is required, I’m choosing larger showrooms with more space so we can be distant. There are stone and tile companies that offer free samples shipped; Material Bank has been helpful to get samples quickly. I’ll be sending more inspiration images to clients whose projects have been delayed. This will help keep them excited.”
Even though most showrooms are closed, and everyone wants to be mindful of social distancing, designers and specifiers are still responding via email and video conference so their clients don’t feel forgotten and business feels as “normal” as possible while abiding by health guidelines.
“We want to continue specifying and procuring,” said another respondent. “I think the key is communication, kindness and being transparent about what is going on from our side of the project.”
Others are using the time that their showrooms are closed to create digital brochures and are sticking with – or amping up – internet marketing planned for 2020, updating their websites and creating new content. Software like Chief Architect and 2020 allows clients to see renderings of their new spaces.
“We are using every technological opportunity available to maintain contact with clients and continue planning stages,” said one designer. “We’re working to keep everyone safe, our employees and clients. We’re also reaching out to future clients, since 80 percent of work is from home anyhow.”
NKBA members have proven to be resilient and determined to use their exceptional creativity to power through almost any challenge. The housing recession of 2008-2009 tested everyone, and the strong survived. While this may be a bigger test, NKBA members will find a way to work in this new world as well.
NKBA will continue to report additional findings in an effort to determine industry trends during the pandemic.
– By Dianne M. Pogoda, article original posted
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