EVP & CSO Suzie Williford shared the latest research with international brands exploring North American opportunities at SICAM, the international kitchen and bath components event, in Pordenone, Italy.
By Dianne M. Pogoda
NKBA joined SICAM (Salone Internazionale Components, Accessories and Semi-Finished Products) for its annual trade fair in Italy to share information about the North American kitchen and bath market and the benefits of joining the NKBA Global Connect program.
SICAM, a Global Connect Strategic Alliance Partner, hosted October’s four-day showcase of European interior and kitchen furniture, hardware and technology in Pordenone, just north of Venice in northeastern Italy — the heart of the Italian furniture manufacturing region. Some 500 components exhibitors participated in the expo, which attracted an international audience of about 20,000 from all over Europe and Asia.
The Market Outlook
Suzie Williford, NKBA’s EVP and Chief Strategy Officer, presented “Understanding the North American Kitchen and Bath Market” to manufacturers and trade organizations exploring opportunities in the U.S., and brought them up to speed with the latest economic research and exclusive data from NKBA’s own research department.
“We prepare an extensive annual economic outlook and update, as well as the quarterly Kitchen and Bath Market Index [KBMI], in collaboration with the highly regarded John Burns research firm. This gives us real-time data across the entire kitchen and bath channel,” Williford began. “It helps us to gauge the current and future health of the market and provide growth estimates. We poll a wide cross-section of manufacturers, dealers, builders and designers to analyze changes in consumer spending patterns and shifts in the housing market that affect remodeling, and provide keen insights about potential impacts of recession. It’s invaluable research that our members can act on quickly and stay ahead of shifting market dynamics.”
Williford shared that the updated market outlook revealed that short-term prospects for new construction, professional installation, repair and remodeling all show single-digit declines, “although the market is still stronger than it was even pre-pandemic,” she noted.
“The long-term outlook remains strong, thanks to aging housing stock,” Williford added. “More than 22.4 million homes are in their prime remodeling years of 20 to 39 years old, and that number is growing by an additional 2.2 million over the next five years. Plus, homeowners are sitting on record levels of home equity that they can tap into once rates normalize.”
The overall forecast for 2023 kitchen and bath spending in North America is projected at $179 billion — slightly down from 2022, but 21 percent higher than pre-pandemic levels. While new construction spending is currently outpacing remodeling because of the ongoing housing crunch ($110.8 billion compared to $68.2 billion), remodeling typically drives greater profit margins and has bigger budgets.
“We’ve found that higher-income households tend to shop for better products at independent kitchen and bath specialty showrooms — not at the big box retailers,” Williford observed. “This indicates a ripe market for new and interesting brands coming into the market at a better price and quality level.”
Further, K&B pros are looking for a rebound in 2024. Designers and dealers expect revenues to be 50 percent stronger than 2023, and manufacturers project revenue levels 60 percent higher.
The Global Connect Advantage
Williford explained the benefits of the omni-directional Global Connect program, including access to NKBA research, access to Global Connect advisors and subject matter experts who can help brands navigate entering and doing business in the North American market, and important networking and learning opportunities throughout the year and especially at KBIS, taking place Feb. 27 to 29 in Las Vegas.
NKBA has designed a Global Connect lounge at KBIS in the heart of the international area, where delegations may meet, mingle and make connections with buyers and distributors in North America. Among the Global Connect activations are smaller kiosks for new-to-KBIS brands to test the waters, product spotlights and presentations, panel discussions with designers and distributors, dedicated educational programming and much more.
Learn more information about NKBA’s Global Connect program here.