Home improvement on fast track

By Ray G. Sponsler President Millers Falls Tool Co.

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ing starts will probably remain at or slightly below the levels reached in 1984, but home improvement demand will continue its strong solid growth, at least through the end of this decade. The d-i-y segment remains the fastest growth portion of home improvement, and by 1990 will represent over 6090 of the total market for all home improvement products.

Story at a Glance

60% of home improvement market in d-i.y by 1990...con. tractor business must be vigor. ously pursued...quality prod. ucts can improve ROl...invigorating year ahead.

The importance of the d-i-yer is very evident to manufacturers, suppliers, distributors and retailers of building materials, hard goods and hardware, and power and hand tools. Although the d-i-y market growth rate of nearly 1590 for 1984 will probably not be repeated, a compounded growth rate of approximately l09o per year is expected from 1985 through 1990. Very few markets in our whole U.S. economy will be able to grow at this outstanding rate!

To "be alive in '85" and beyond, and to grow with the d-i-y market, retailers, wholesalers and manufacturers must expand their market share, increase d-i-y awareness, and improve their sales productivity. The natural "pull-through" of building materialshardware-tools creates excellent opportunities for those willing to make the extra effort.

Manufacturers' support programs, through wholesalers andlor buying groups which provide advertising programs, point-of-purchase displays and d-i-y education, can help retailers improve their sales per square foot, which will improve margins and R.O.I. which in turn will provide funds for increased advertising and additional d-i-y awareness. During 1985 we will see improved service from manufacturers on those quality products which have high perceived value by customers. Dealers and retailers who take advantage of these services will increase market share.

Even though 1985 will show increasing importance of the d-i-yer, the contractor portion of the home improvement market should not be overlooked. Generally speaking in the hard goods industry, and particularly in tools, the contractor is becoming more qualityronscious and less priceconscious.

In 1985 more and more lumber yards and home centers will introduce the proven successful concept of the "contractor's corner" or some similar special area set aside for displaying only highquality professional tools and equipment geared toward the building tradesman. A bonus of this plan is that in addition to capturing more of the professional market, which produces higher sales dollars and margins, it encourages many serious d-i-yers to "up-grade" themselves to items of higher perceived value.

Undoubtedly, 1985 will provide exciting opportunities and programs for all of us to participate in and nurture our businesses in an expanding market with excellent growth potential.