We know they are out there, and I have a copy of an ad to prove it. The they I am referring to are kitchen remodelers, cabinet dealers and shops who are constantly keeping the pressure on the market to expect rock bottom prices. So, what should a shop owner struggling to maintain healthy margins do about it?
Well, here it is in all its glory. The ad says the remodel has a value of $20,000 and includes granite counter tops, labor and materials. It also says members get a 55% discount to $8999.00 and there are only 5 days remaining. I also note that the photo is too small to easily identify the materials used. But the price and the Last Chance 5 day deadline drive the ad home to prospects that may be in the market for a new kitchen.
I got this ad from a rep who was calling on me to buy advertising with his company. It made an impact on me. And it got me thinking about some things very basic to the cabinet business.
click image to zoom Why are you in business for yourself? If you’ve been running your own shop for a while, you probably have already come to the crossroads where you needed to determine the answer to that question for yourself. If your answer is something like your love of woodworking, your ability to create beautiful things where money is secondary, your answer won’t be the same as another owner who is in business to earn a profit and uses his craft as a means to that end.
I think many of us who have weathered the recent economic storm have been staying alive because we were able to capture a slice of the market we would have previously passed on. Diversification can be a wonderful thing, and can keep food on the table.
Is it possible to earn a profit on an $8999 full kitchen remodel? It may be. Regardless of whether you choose to operate in that end of the market, you can count on most of your prospects have seen similar offers and ads while they have been shopping for their new kitchen. Odds are they have (or will) stop at the local big box store or retail showroom to see what is available, they’ll research kitchen cabinets, styles and trends on line, they’ll study circulars and Sunday newspaper ads and they’ll be bombarded with many, many offers just like this one.
There is no shortage of competition anywhere that I know of, and those who are attracted by a low, low price may never find you. If they do somehow contact you, how would you respond to an offer like the $8999 kitchen if the prospect sitting in front of you brings it up? How you answer that one depends very much on how much you value that prospect sitting at your desk and what your answer is to why you are in business.