Hackettstown, New Jersey — Despite ongoing material shortages and rising labour costs, the National Kitchen and Bath Association (NKBA) is reporting an 11 per cent growth in sales for the second quarter of 2021. The findings are courtesy of the quarterly Kitchen & Bath Market Index (KBMI), done in collaboration with John Burns Real Estate Consulting (JBREC).
“We’re encouraged by the findings from our report on the kitchen and bath industry, which reaffirms the longer outlook of the field as one of growth and strong earnings,” said Bill Darcy, NKBA’s CEO.
While the pandemic continues to impact the supply chain and material development industries, the KBMI reports that the price for kitchen and bath products has increased by double digits. The report also highlights that labour challenges still exist as 80 per cent of companies report increasing labour rates to retain employees, with nearly two-thirds report rising rates of as much as 19 per cent.
Despite these hurdles, the KBMI reports there is an apparent demand for remodelling services as 60 per cent of designers have reported a backlog of at least three months. Secondly, 55 per cent of the building and construction industry reported zero projects cancelled in the second quarter of 2021. Lastly, despite an increase in material costs, nearly half of retailers (46 per cent) have begun to see a shift in typical price points demanded by customers, with 89 per cent saying their customers are shifting toward the pricier, higher-end finishes.
The report also highlighted that despite the progression of the Delta variant, NKBA members reported a significant drop in the pandemic’s impact on business, giving it a score of 4.9 out of 10. In addition, a record overall KBMI score of 82.3 per cent was recorded.
“While we are seeing the continued delay of materials and increase in labour costs causing problems and concerns within the sector, it also shows that the sky-rocketing demand for remodelling projects has continued,” said Darcy.