The Why, the Who and the How of Disruption in the K&B Industry
There has always been a lot of discussion surrounding the idea of disruption in the Kitchen and Bath Industry. In fact, it almost feels like people have been predicting it for so long that it’s not going to be the big storm they were calling for but more like a mild afternoon shower. Maybe that’s the way it will play out. A slow transition to new technology that will leave plenty of time for Dealers to adapt to the changes. Hmmm well that would be nice for folks that need a little more time to get acclimated to space outside their comfort zone.
It sounds so nice; I almost feel like making a cup of hot cocoa along with a warm cinnamon bun while I’m writing this. Boy, doesn’t that sound relaxing? Maybe I’ll take a morning stroll up on the deck of this beautiful new ship I’m travelling on. What a lovely name for an Ocean Liner, Titanic, Titanic, Titanic…. It almost rolls off the tongue like a …. BAM!
What in Sam’s Hill was that?? Not one of those ice cubes floating around in the water. I mean really…. How much damage could that cause to my business, I mean to the ship? Wake up son and grab your water wings and a raft!
Well, we all know the story of how 2,208 people boarded the Titanic and only 705 survived. That’s about 32% or 1 out of every 3. Could that be the destiny for K & B Dealers over the next 5 years? Say roughly, just for rounding purposes, there are 30,000 independent Kitchen and Bath Dealers in the U.S. That would mean only 10,000 of those would still be around. I’m not referring to showrooms but to the companies.
How could that possibly happen? Well let’s take a step back first and try to understand what this bad word “disruption” means to an industry. I guess the best way to characterize it is by saying that it is a big shift in market share. Because if there isn’t, what’s the big deal? Everybody holds on, more or less, to the business they have. Huh. Do I think that’s what is going to happen? Do you? I’m pretty sure you know my take on it, or I wouldn’t be up at 5 AM writing this stupid blog!
Okay, I digress as usual 😊 Time to get into the meat and potatoes of this whole disruption idea. First, let’s ask ourselves three questions to see if this circus even has wheels. (don’t ask, it’s early)
- Is the industry very fragmented with numerous small dealers? Oh yeah!
- Would you reckon that most of these Dealers are a little antiquated when it comes to technology? Abacus please!
- Is this an Industry that is large enough to attract the attention of a lot of investors? You bet your bottom dollar it is! Just for fun we will peg it around 60 billion. That’s a lot of cheddar!
Okay, let’s say we have a pretty good idea that this industry is ripe for disruption. Well, there has to be something that causes this shift in market share. Let’s investigate that next.
- The customer experience. Yes, this has to top our list, because at the end of the day, it’s their call!
- A new product that is better than whatever anybody else has? Maybe, but doubtful.
- Market inefficiencies? Do we even have to go there? So yes!
- Evolving competitive landscape. Like the continuation or entry of non-traditional competitors. Get Creative. More manufacturer direct, online consumer selling platforms? Indeed, it could.
- Technology advancements that would include AI, Augmented and Mixed Reality, 3D printing, etc. I’ll bet some pretty cool platforms could we built with those things. Yeah, I think it’s safe to say we can throw that hat in the ring.
- Collaboration and Partnerships. It’s like a collective ecosystem that brings together the different players through technology, manufacturers, dealers, fabricators, installers, customers etc. A big nod to that one.
- Bonus Round! Data Utilization. It may sound fancy, but it could bring huge changes to the competitive landscape. Consumer profiles, marketing, productivity optimization and the list goes on. It’s like a look into meaningful data that leaders can learn from then apply. Say it ain’t so!
I knew that this subject would be long(winded) but it’s that important! thad
Until next time…close your eyes and swing for the fences!