“Fast Forward” to Better Times Ahead

John G. Swanson
January 15, 2008
COLUMN : Opening Remarks | Management

News in the industry hasn’t been very good as of late. While I generally start new years with renewed optimism, I’m realistic about 2008. So Therma-Tru Doors’ David Haddix struck a chord for me when he noted for our industry forecast (page 51), “The future is bright. I just wish we could fast forward.”

I share his optimism for the future and that eagerness to move on. I also know that it ain’t necessarily all that easy. There are window and door companies out there operating in “survival mode.” Comments that business is “down 30 percent” were fairly common for 2007, and I know the numbers are worse in some places.

Sure, there are manufacturers and dealers out there that bucked the trend and held their own. A handful has also reported they were actually up for
2007, but for many, it was a struggle last year. And, it’s not over yet.

Yes, there are signs of life in the remodeling and replacement market, but there’s still uncertainty about when we’ll start to see a turnaround in the new construction market. So the idea of fast forwarding is very appealing.
Let’s imagine window and door sales are starting on a new upward curve. Depending on the market niche or region, an upturn might consist of a few more builders talking about some small projects they’re starting. Or perhaps a little more traffic in the showroom as rising fuel bills take their toll on homeowners.

Have you thought about what the recovery might look like for your company? If you’re on the new construction side, are the builders you’ve been selling to coming back, or do you need to be talking to new customers? Some builders have pared down their labor force and may now be looking to get their windows and doors installed. Others may be targeting a new market segment and looking to you for different products.

If you sell replacement windows, your customers may be asking more “green” questions. The homeowners you’re calling may have seen an array of color options in some window lines they viewed online, or perhaps they saw a wrought iron doorlite design that would be perfect for their front door. Generally, prospects may want a little more style along with their energy efficiency. And speaking of energy efficiency, more stringent Energy Star requirements are coming down the pike. We don’t know what they’ll be yet, but if you use that label to help you sell, you had better be prepared.

If you’re hunkered down in survival mode—and not preparing for the day demand starts coming back—your company could miss out. Despite the tough times, you can be sure there are competitors out there getting ready for the rebound.

It wasn’t too long ago that some manufacturers would say to me, “We’re having enough trouble getting product out the door,” when I asked about any new initiatives at their companies. Meanwhile, others continued with new product development, plant overhauls, IT implementations, etc., etc. I hope the companies that were “too busy” to start implementing new plans during the good times aren’t saying times are “too tough” now to make any sort of investments.

In an article on page 73, Ron Auletta of GED Integrated Solutions urges window and door manufacturers to take steps now to make sure their processes are as efficient as possible. He wisely advises that even when the recovery comes, keeping costs low will be crucial to long-term success. Competitors are taking steps to improve. And you can add the potential threat of more imports. Simply holding your ground or waiting things out could mean you fall behind.

I realize I’m starting to sound a little negative here, and the intent here was stay optimistic. So to get back on track, I’ll refer to Greg Brooks, a consultant in the lumber and building materials industry who spoke at the recent Association of Millwork Distributors convention. He suggested that when the housing market comes back, it will do so in a big way. The basic reason is demographics. The numbers for household formations over the next several years are expected to be higher than they were even during the housing boom. We may not see another boom, but demand should be strong and fairly steady once it comes back.

The numbers of windows and doors sold should trend upward, and value-added opportunities will expand. First, there’s the ever-increasing need for energy efficiency. Green thoughts will stimulate new ideas about windows and doors. Continued strength at the upper end of the market promises buyers willing to pay more for the look they want.

Personally, I like the trickle of electronic hardware we’re starting to see in our market. We have a growing “aging-in-place” market where these products will increasingly be a necessity. People like new gadgets too. I’ve noted before that growing demand for retractable screens, internal miniblinds and automatic sash locks suggest to me that the general population is ready to opt for added functionality and ease of operation if we can deliver it to them in an eye-pleasing manor. 

We have to keep an eye on the bottom line during these tough times, but it’s important to “fast forward” too. It’s not just optimism. Thinking ahead to better times—even if we don’t know exactly when they’ll be here—is going to be critical to taking advantage of them.