Mark Richardson, CR, is an author, columnist, and business growth strategist. He authored the best-selling book, How Fit Is Your Business? as well as his latest book, Fit to Grow. He can be reached at firstname.lastname@example.org or 301.275.0208.
One way to combat the labor shortage is by using methods—such as modular construction—that require fewer workers and less time. Modular builds have picked up steam in the commercial market and many are predicting a slow, but steady, increase on the residential side as well. Installing a custom modular addition typically takes less than half the time as building an addition on site.
While some people like to think in black and white, the reality is that change generally comes in shades of gray. Most of the following predictions are about these subtle shifts. That said, what I do see different in 2018 is that the shifts will be more significant and happen more quickly than in the past.
My top 10 predictions for 2018:
1. A strong business environment
The market and key economic indicators are all looking positive. The five that I like to watch are a) home appreciation b) interest rates c) employment d) new housing e) the stock market. When these are mostly pointing up, then consumer confidence is high, which makes for a great remodeling environment. I predict these will remain strong in 2018 and create a nice tailwind for remodeling.
2. A new approach to the labor shortage
Many are highlighting the labor crisis as a reason for falling short in 2017 financial returns. Given the magnitude of the shortage, I believe the solution will not be through immigration or getting more young people into the field. I predict that the better companies will find ways to reduce the labor required to complete projects. This will come through process improvement; new designs and solutions that require less labor; and products that are less labor intensive to install.
3. Younger clients
Historically, the majority of remodeling clients are baby boomers. In 2018, I predict a noticeable shift to a 30-something homeowner. This might even account for one-third of your clients in 2018. With that in mind, marketing, selling and communicating with this generation will be critical to your success.
4. The decline of in-home selling
This may be one of the most disruptive predictions, and I do see it coming quickly. Over the next few years, the in-home selling process will shift to become a blend of in-person and online sales and product selection. We will start to see real evidence of this in 2018. Most homeowners don’t like the kitchen table sales ritual, and it’s not cost effective or predictable for businesses.
5. A change in project types
I believe that home additions will continue to decline in 2018, or we will find better prefab solutions. I also predict that the importance of the outdoor space will dramatically increase. As we see cultural changes in the way cars are used, we will see fewer garages built and more electric car chargers installed. Many homeowners also will continue to make energy efficiency and solar power a priority in their lives.
6. A backlash against too much choice
More and more homeowners are overwhelmed by too many options. This causes clients to become paralyzed by stress and take much longer to make even simple product selections. You can help your customers in 2018 by becoming the voice of reason. Suggest they resist the urge to endlessly browse tile online, and instead allow your expertise to help them. This will increase sales, improve profits and create more delighted clients.
7. More socially conscious homeowners
While most clients don’t want to spend twice as much just to help a particular cause, they’ll often pay a premium to work with cause-driven businesses.
8. Increase in speed
In 2018, the speed at which we live will continue to increase. That speed, and the convenience it creates, also will become a more important remodeling sales benefit. The amount of time it takes a company to respond, design and build will make the difference between a satisfied or delighted client. That’s not to say quality and experience are no longer important because they are,but speed will take on an increasingly significant role.
9. The importance of data
This needs to be an integral part of your remodeling, marketing and sales process. Data is more available and affordable now. This data will allow you to pair up the right sales process and people with the right client. It will allow you to filter in ways to increase close rates and reduce waste. This data will help your messaging and communication.
10. Online reviews
In 2018 homeowners will begin to stop asking friends and family who to call for remodeling. It is much more efficient and effective to just go online and read many reviews (especially the local community-based feedback), not just one word-of-mouth referral. Making the online review process a top priority will help lead flow and the closing process. Past clients will become potential future clients, but less of a predominant referral source.
Most of these predictions are not a “wow.” The biggest prediction I have is that the speed at which these predictions are all taking place really requires you to spend the time now thinking through the chess moves for your business.
The stars and planets in 2018 are aligned very well for home improvement. It is a time to grow and to gain market share. It is a time to make hay and not slow down. The key will be to find the right balance and stay in the wave.