Credit: Illustration: Barry Blitt
Last fall phones at many home improvement companies around the country fell silent. Faced with a sudden plunge in revenue, owners could either hold their breath and hope sales would rebound or they could take a hard look at the size of their business and make appropriate decisions.
Sales, of course, didn't rebound. Not right away. Even at companies thathad never seen sales go backward, thestory was the same. Average ticket down.Leads fewer and more expensive ?sometimes way more expensive. Prospects harder to close. Fewer consumers were in the market, and those who were knew that companies would do just about anything for their business.
Owners faced with those difficult choices lost money as well as sleep.Some slashed their own salaries. Some ran leads for the first time in years.Some watched their companies fold.The home improvement rumor mill was operating all three shifts.
The recession isn't over. But consumer confidence has risen, and the stock market has stabilized.
For many home improvement contractors,the American Recovery and Reinvestment Act (ARRA), passed in February, was the first good news they'd heard for awhile. Many wasted no time integrating ARRA tax credits into their sales and marketing messages.The idea: Why postpone buying the windows, roofing, or insulation you need when the government will partly reimburse you for the purchase now?
Companies not only promoted the stimulus bill and its tax credits, they crafted offers around it. As a result, many directly benefited from the ARRA and stimulus spending. As of this month, several reported 10% increases in window sales. And those tax credits remain available until the end of next year.
The stimulus bill has been a boon to this industry. Still, no one really knows where things go from here. What we do know is that credit is tight and unemployment remains high. Economists say both will likely stay that way for a while.
But owners of companies that have survived the downturn are savvier than they were a year or two ago. They've learned how to make do with less and how to be more nimble in executing business decisions. Many are more profitable, even if their sales are not as great as they were before the downturn. A year or two from now, they would probably agree that while The Great Recession was an unpleasant experience ? if not a harrowing one ? there were valuable lessons learned.