K&B Market Growth: 10.7% in 2021
HACKETTSTOWN, N.J. — Kitchen-and-bath industry sales continue rising from last year’s COVID-19 slowdown and indicate a better 2021, according to a recent study.
The National Kitchen & Bath Association (NKBA) and John Burns Real Estate Consulting (JBREC) report detailing the fourth-quarter 2020 Kitchen & Bath Market Index (KBMI) shows industry sales in the last three months of 2020 grew 2% from the third quarter and 4% year-over-year from fourth-quarter 2019.
Retail sales are experiencing especially impressive growth, with average sales up 7.9% from last year, followed by manufacturing (5.5%), building/construction (3.8%) and design (2.4%).
The report sees an increase of 10.7% in industry sales in 2021 from last year.
The KBMI reached a rating of 65, representing a third consecutive quarter-over-quarter increase. The index stood at 61.9 in third-quarter 2020, and was below 50 in both the first and second quarters of last year. Scores above 50 indicate expansion and scores below, contraction.
All indicators of this report have improved over the last several quarters — with kitchen and bath market respondents ranking current conditions at 59.8; future conditions at 72.7; and the health of the industry (measured on a scale of one to 10) at 7.1, just below the pre-pandemic 7.2 registered in Q4 2019.
Supply-chain disruption, cost of materials, concerns around keeping COVID-19 under control and availability of skilled labor are the top concerns of industry professionals. More than half (56%) say COVID-19 has worsened the pre-existing labor shortage by fueling demand, with 58% reporting their pipelines are larger now than at the same time in 2019.
The report also noted consumer trends, such as:
Homeowners are undertaking larger projects, including expanding and rearranging floorplans or creating dedicated offices, to increase home functionality.
Pandemic circumstances driving demand to 60% of kitchen and bath companies, with consumers are beginning remodeling projects they planned while sheltering in place in 2020.
Higher demand for lower-priced products and finishes. Homeowners also seek out wellness design, perhaps unsurprisingly given the focus on physical and mental health spurred by the pandemic.
“We’re seeing an incomparable surge in homeowners looking to rearrange floor plans, tear out complete kitchens, baths and other rooms to make space for increased activity within the home, and generally create a space that better suits their evolving needs,” said NKBA CEO Bill Darcy. “Our industry’s greatest challenge will be operational, as our members aim to meet growing demand from homeowners with an unmatched appetite for remodeling.”
The study also showed strong growth in retail sales across all price points, and demand continues to exceed supplies for manufacturers. And, more than half (56%) of building and construction firms reporting a zero rate in cancellations and postponements.
The National Kitchen & Bath Association (NKBA) is the not-for-profit trade association that owns the Kitchen & Bath Industry Show® (KBIS), as part of Design & Construction Week® (DCW). John Burns Real Estate Consulting is an independent research provider and consulting firm focused on the housing industry.
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