Research Shows Larger Remodeling Firms Doing Better in Downturn

[ChrWright]

Research Shows Larger Remodeling Firms Doing Better in Downturn
Not taking the hit on jobsize that smaller companies are
By Jonathan Sweet, Editor in Chief
December 14, 2009
HousingZone

New research by Professional Remodeler shows that the largest firms are not seeing as big a decrease in job size as the rest of the industry.

According to a survey of more than 400 remodelers that will be published in the January issue of Professional Remodeler, 62 percent of companies have seen their average job size drop this year by more than 10 percent and 11 percent report a drop of more than 50 percent.

But for those firms that have annual revenues of more than $2 million, the numbers are much less discouraging. Only 5 percent of those firms have had job sizes drop by more than 50 percent. Half of those companies have seen no decrease or one of less than 10 percent. In fact, 16 percent of them reported an increase in average job size, compared to only 8 percent of all remodelers.

Every month, Professional Remodeler surveys its readers to produce exclusive research. The full results of the Professional Remodeler project trends research will appear in the January issue of Professional Remodeler and on HousingZone.com.


http://www.housingzone.com/article/ca6711522.html?nid=&rid=


400 seems like an awfully small sample to me. I'm sure that can be considered statistically significant.

[Silvertree]

Interesting, so why would that be true?

[ChrWright]

Pride and ego for one. That's the challenge of any survey--how to ensure the honesty of the data you receive.

I met a lot of guys with big companies at the RS, and most were complaining about smaller projects and smaller gross sales. (That's anecdotal evidence, I know.)

I'm not saying the survey is junk--it's as you say: "interesting".

[OGStilts]

OK complete speculation on my part but it may be because the guys doing $2M and more in renovations every year cater more towards the bigger projects in the first place. These aren't the guys doing $10k bathrooms or $35k basements, so their market tends to be wealthier clients. Wealthy people tend to always have money, it's just whether they are in invest and protect mode or if they are in splurge and show off mode to how they spend their money. Some people never get out of splurge and show off mode. Regardless, there will always be projects of all sizes. I think the problem isn't in the size of projects as much as it is the quantity of projects.

The bigger companies with all the marketing and name recognition to go around are still getting these big projects but maybe fewer of them so their average job size is staying about the same or may be increasing. And since there are fewer big projects to go around, there is less left-overs that the smaller companies are picking up or beating the bigger companies out of. One or two less "big" projects for one of these smaller companies will dramatically affect the average size of their jobs more so than it will the bigger companies.

Just because they aren't seeing a drop off in average job size doesn't mean they aren't seeing a drop off in the number of jobs or in their profitability.

[orson]

How can their data possibly be accurate in this respect when they don't allow remodelers with less than 500k in income subscribe to their publication?

[Eieio]

How can their data possibly be accurate in this respect when they don't allow remodelers with less than 500k in income subscribe to their publication?


We do not need any noise out of the remodeling peasants.. :laugh3:

[bconley]

How can their data possibly be accurate in this respect when they don't allow remodelers with less than 500k in income subscribe to their publication?

You told them the truth?:)
Pride and ego for one. That's the challenge of any survey--how to ensure the honesty of the data you receive.