How Will Cabinet Manufacturers Respond to the Slow Down?

How will they fare?

In last week’s blog, I talked about the decline in the number of cabinets that are being manufactured today. So, what are they going to do now that the price increases can’t go out left and right anymore? It might be a good time to take inventory of their customer base and what they are looking for in price points and lead times.

With housing prices dropping too, the builders are going to be looking for something that can save them money. I think the hardest hit will be in the semi-custom category. They were certainly having a heyday with it when demand was so high, they could almost just set the price and a long lead time and people still bought from you.

The impact is not just going to happen on the new construction side but on remodeling as well which is their sweet spot. As house prices drop, and interest rates go up, with the amount of equity in current home and a shaky/unstable economy, I am afraid that we are going to see the remodeling gravy train pulling out of the station. I am not suggesting that the market for kitchen or bath replacements or remodeling is going to dry up, but it is certainly going to slow down some.

One thing that will be interesting to watch is how market share is going to start shifting with the cabinet market. During the height, a number of manufacturers had to cut off dealers or extend their lead time to “we can’t see that far out”. 😊 This allowed several new kids on the block to spread their wings and grab some business. Will they retain their foothold and keep growing their business? It all comes down to about three things when you are looking at which manufacturers will grow and take market share.

  1. Customer Service – It always has been and always will be number one over others. Right now, when someone calls you back, the bar has been set on expectations.
  2. Price point, lead times, and reliability – I think most of the dealers are tired of ordering cabinets and having issues on every job. Do what you said you were going to do.
  3. Your customers are life insurance for your company. They are what you are betting on in the future. Are you just going to cheer them on and hope for the best?

I’d really like to see some cabinet manufacturers come out with programs that will help dealers grow. We have already started working with Independent Rep agencies and individuals on how they can add more value to their dealers by partnering with them and providing resources that will make them “pie-eaters” and not the ones that are getting their lunch handed to them. It’s there for the taking but it’s going to be a change in their thinking. Easy Peasy.

KABS is a Software Designed for Kitchen & Bath Dealers
Take your dealership to the next level
using a cloud-based ERP system.
(2020 Design Software Integration, QuickBooks Online Integration)
Join one of our weekly demos to see it in action and learn more!