Y2K predictions of a different sort

Home Channel News, Jan 10, 2000

Last month, National Home Center News achieved the dubious distinction of being named by Time magazine to its list of the "worst best last lists of the century." Our list of the 100. Luminaries Who Left Their Mark on the Home Improvement Industry (NHCN, Oct. 25, 1999, page 50) was ranked alongside the Guinness Book of Records' 10 Greatest Inventions of the 20th Century, the British Erotic Review's Top 50 Erotic Personalities of the Millennium and the Intercollegiate Studies Institute's 50 Worst Books of the Century.

We got off easy compared to other lists. About the Guinness list, Time writes, "Rubik's Cube, the Walkman and Tupperware made the cut; computers didn't." Regarding the Erotic Review: "No. 1, Marilyn Monroe; No. 4, Margaret Thatcher."

This critique comes from a magazine whose Website features a Person of the Century poll ("the person who, for better or worse, most influenced the course of history over the past 100 years") headed by Elvis Presley. And Madonna finished ahead of Winston Churchill!

Time summed up NHCN's Top 100 in one word: "Riverting."

With apologies to Time magazine, here's my list of 10 home improvement industry key trends to watch in 2000.

1. The Internet will be the top phenomenon.. Time at least got it right by naming Amazon.com founder Jeff Bezos as its 1999 Person of the Year. You can argue that this Internet retailer has yet to show a profit; nevertheless, Amazon has already dramatically changed consumer shopping habits and accelerated the acceptance of e-tailing. This year, the two largest industry retailers will be going head-to-head against Amazon.com for online home improvement sales.

2. The upscale housing market will be hot. Regardless of the general economy's direction, the market for upscale home repair and renovation will be strong owing to financially well off baby boomers. Dealers that focus on this segment will prosper.

3. This year will be marked by accelerated international expansion and consolidation, including some interesting strategic alliances. Companies that are strategically positioned to compete in a one-world market will win.

4. The furniture and home decor market will provide fertile growth for industry players: Home Depot's stores and Expo Design Centers, Sears' The Great Indoors showrooms, Lowe's warehouse stores and perhaps even Home Base's test concept locations will become major players in home decor.

5. Independent dealers, particularly pro-oriented ones, will further specialize: in business segments in which they can compete effectively. It's no longer good enough just to he a "pro dealer." A dealer must focus its resources on a large national builder, regional production builder or custom home builder subsegment.

6. Pre-fabricated housing will grow.

7. More dealers will install the products they sell to builders.

8. Traditional supply channels will he deconstructed as builders demand value-added services at every link of the supply chain.

9. Merger activity will focus on small and regional players being acquired rather than past large chain mergers.

10. The shortage of qualified job candidates will be the No. 1 problem for all industry players, retailers, distributors and manufacturers.

A "riveting' list? Perhaps not. Consequential to your business success? I think so.