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Subject: Re: Slowing sales prospects for my shop


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Message Thread:

Slowing sales prospects for my shop


My shop builds kitchen cabinets for retail customers in Seattle. We sell all of our work directly to homeowners. We don't sell anything through contractors or architects.

We have a lot of work right now.
We're going to need to push to get it all produced on time.

Just about all of this is work that initially showed up about three months ago. We have some new prospects in the pipeline that possibly could be turned into work but not near as many as we would have seen during this time of year one year ago.

I would estimate that new prospects showing up each month are running maybe 25% of where they were just six months ago.

Is the phone ringing in the rest of your shops?

5/3/18       #3: Slowing sales prospects for my shop ...
Collin Parker  Member

Website: heritagewoodwright.com

We are not slowing a bit, opposite. Sounds like you are missing out on a huge mkt not dealing with contractors. In a hot mkt there will be a lot more cabinet shops opening. These will certainly affect your direct to consumer model in which youíll need to offset with some type of advertising. Contractors on the other hand do their own advertising etc so as long as theyíre booking jobs then so are you.

5/3/18       #4: Slowing sales prospects for my shop ...
Family Man

No slowing of clients or prospects, but definitely a massive uptick in contractors and clients that are tapped out and are having a hard time paying. I've never seen it this bad over such a wide swath of clients, including the tapped out period before the financial crisis. It's been building for a year slowly and while I don't think it has peaked we are requiring our money upfront it has gotten concerning enough.

5/4/18       #5: Slowing sales prospects for my shop ...
Matt Calnen

Itís so hot here, and a lack of good skilled workers, that some general contractors are paying time and a half to their subs. Never seen that before. And also a number of DSA with their names on the sides of the truck and a tool belt from out of town are starting to be seen.

5/4/18       #6: Slowing sales prospects for my shop ...
Pat Gilbert

I posted this before, people's taste in furniture is changing.

People buy furniture when they buy a house.

Maybe this is apt maybe not, ignore at your own peril.

5/5/18       #7: Slowing sales prospects for my shop ...

Website: http://morantzcabinets.com

After 37 years in business in two countries, and being a religious person to start with, my attitude is blessings come from strangest places sometime and even with hard work and savvy marketing,it can be boom or bust. Most of my work for the past two years has been for builders ripping down older homes in affluent areas and putting up new modern construction, as well as high end designers. We have added two more employees this year and just keeping up with the load. The direct retail client that came from Houzz.com or my web site has dropped considerably, and my Houzz clientele which was always higher end clients has become Angieís list tire kickers. I have more work and have not renewed my Houzz contract of 350.00/month and have cancelled my 300.00/month SEO, as I am getting more salicitations from web designers and health insurance salesman than anything else.
This can change anytime and I have seen these shifts over the 37 years often and cannot claim credit for the success or lay blame for slower times. Itís mainly Karma, divine providence or whatever rocks your boat&#128512;

5/6/18       #8: Slowing sales prospects for my shop ...


In another forum you are bragging about how you ripped off somebody $60000 on a kitchen. In this day and age a lot of clients, especially when you are selling directly to the end user get more than one price.
When they can buy a $80000 dollar kitchen for what itís worth from your competition, itís not likely they are going to pay you $140k for the experience.
The worst problem is that with social media it doesnít take long for a lot of people to get the news. With that kind of advertising it wonít be long and you wonít have any work.

5/6/18       #9: Slowing sales prospects for my shop ...

I don't know if you've ever worked in the $100K+ marketplace.

One of our projects was $330K.
Another cabinet shop on the same job billed out $240K. This was for un-finished, un-delivered, un-installed cabinets.

I would guess the fellow who bought this work earned enough during the timeframe of construction to buy & pay for ten of these projects.

About one year after the project was completed a new buyer bought the condominium and ripped everything out because he could.

Trust me. Anybody that can pay $80K can pay $160K.

More on this later.

5/6/18       #10: Slowing sales prospects for my shop ...

I created this post because a lot of different data points have come to my attention lately. I don't know whether or not any of them are linked to each other but taken together their preponderance may coalesce into some kind of cogent observation.

During the first four months of this year I have observed:

1) Tax exemption for mortgage interest has been significantly curtailed in upper end real estate.

2) The Feds have increased their lending rate to banks for essentially the first time in nine years. Money now costs something. You used to be able to borrow it for free.

3) Stock market is no longer a quiet steady march upwards.

4) Zillow is in house flipping business.

5) RedFin is offering 1% mortgage brokerage fees instead of standard 6%.

6) Homelessness is rampant because tech worker wages is pushing people out of the housing market.

7) Seventy percent of all real estate in Seattle is committed to single family residences. The only way to make housing more affordable is to open up the single family neighborhoods to higher density housing.

8) New business inquiries at my shop are down significantly from this year over last.

9) Website statistics show fewer people lingering on the site. We used to have 25 people every month stay on our site for over 30 minutes. These types of metrics for the last four months are running about 30% of what they did for the same four month cycle one year ago.

5/7/18       #11: Slowing sales prospects for my shop ...
Pat Gilbert

The yield curve will likely invert in August. Which usually means a recession (but not necessarily).

If one materializes it will be mild.

I would look more at the age bracket of your customer and how that relates to the demographics of your market.

5/7/18       #12: Slowing sales prospects for my shop ...

Of all these possible yellow flags I think that the housing crisis is most salient for cabinet makers in high tech market places.

Single family homes have become so precious that very few people can qualify to buy them. Tech-Centric communities are creating jobs at about three times the rate they are creating new housing. This pushes up the cost of rent and the cost of purchase.

These tech workers, however, still have a lot of disposable income and they too want to own the homes they live in. They soon will also have considerable clout in local politics. They will eventually band together to support political campaigns that will increase density in these single family neighborhoods.

As soon as these neighborhoods are up-zoned every new kitchen sale will be into a town home instead of a Craftsman bungalow. The people developing town homes won't be buying cabinets from people on the Woodweb.

5/7/18       #13: Slowing sales prospects for my shop ...
Alan F. Member

We do residential when its in a mixed Commercial / environment and is WI certified or FSC TM C.o.C.

We are seeing more and more of this in tech areas.

Someone else did the Visa Offices.

View larger image


5/7/18       #14: Slowing sales prospects for my shop ...
Pat Gilbert

The cause of a recession is over-investment always.

There isn't any right now.

View higher quality, full size image (641 X 474)

5/11/18       #15: Slowing sales prospects for my shop ...
Jim Conklin  Member

Website: http://www.jhconklin.net

East coast furniture refurbishment targeting upper middle class: inquiries and web traffic are suffering the annual 'May-Dismay' as cabin-fevered folks turn their attention to flower beds, patios, and anything outdoors. Our metrics are in a parallel track with last year (dipping together), but are up about 6%.

The web metrics are getting harder to clarify what with the Google My Business listing serving as a de-facto home page especially on mobile devices. Some fair percentage never click through to the website, but just troll the stuff in the listing instead.


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