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The National Kitchen & Bath Association (NKBA) – one of the world's leading non-profit trade association for the kitchen and bath industry providing tools, research, certification, and events to thousands of professionals – has released its final Kitchen & Bath Market Index (KBMI) for 2021. The quarterly report, which is aimed at measuring the health of the kitchen and bath industry, found that the industry ended the year on a positive note.
"We're extremely encouraged by these results as they confirm that the industry remains optimistic about its future – with the sector remaining nimble and creative in order to continue to be successful in the face of continuing challenges," said Bill Darcy, CEO, NKBA. "While we're keeping our eye on a few things such as ongoing supply chain issues and pricing inflation, the fundamentals for the industry remain strong including continued consumer demand with strong home values and equity levels."
The remodeling industry has been the beneficiary of a seller's home market, with homeowners leveraging their home's market value to renovate spaces within their home to both increase value as well as live-ability and flexibility. In Q4, all kitchen and bath segments reported double-digit sales growth YOY, as well as a solid quarter-over-quarter performance with an increase of 8.1% in total spending. While challenges persist, some of these may be helping the industry see long-term growth by spreading out projects into 2022. For example, the report found that 58% of designer respondents reported backlogs of over 3+ months, with a further 23% experiencing a backup of more than 6+ months. This has helped lead industry professionals to project 13.1% annual growth in 2022.
However, while there is a silver lining, the issues from 2021 continue to persist in the background. Once again, industry members rated supply chain disruption, material costs, labor availability and inflation as their top concerns. An overwhelming 96% of businesses in the kitchen and bath industry have reported supply chain issues affecting their bottom line, while 28% have given material shortages a maximum rating of 10. These ratings indicate a severe impact on their day-to-day business.
"Virtually every sector of the economy has been affected by the ongoing supply chain, material and labor issues, with the kitchen and bath industry being no exception. The report showed that the price of industry products has increased across the board by double-digits, underscoring the cost pressure our sector is under. However, the kitchen and bath industry continues to be resilient in the face of this adversity, setting themselves up for another year of growth." Darcy continued.
Among the report's key findings include the following:
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