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Has the trade fallen out of love
with conservatories?
According to new research, 1.2
million homeowners are considering erecting a
conservatory. What better time to start selling
them.......
Once the holy grail of the
double-glazing sector, conservatories offered the
opportunity for increased and additional sales.
Installers were able to re-visit previous customers and
sell them an affordable extension to the home. However,
over the last 12 months the market for conservatories
has stagnated, with fewer companies reporting sales
growth and fewer trade suppliers promoting their
products.
At its height, the size of the
conservatory market ranged between 200,000 and 300,000
installations per year. Over the last few years many
industry commentators have estimated that this figure
has dropped significantly. Nevertheless, at a time when
the housing market is in severe trouble with the number
of people moving home dropping by 50%, the desire to
expand living space remains. With the average price of
a conservatory currently running at around £8,000
the outlay represents a very cost-effective way of
extending the home compared to a traditional extension.
With a larger budget, homeowners can even have a
conservatory installed with a tiled roof (see page 62).
Healthy additional sales
Despite all these strong selling
propositions, conservatories are no longer perceived by
many installers as being the product line that is going
to reward them with healthy additional sales. What is
evident is that installers are looking for alternative
revenue streams they can add to stagnating window
replacement sales. But are they missing a trick? Should
installers be turning their backs on conservatories?
According to Sainsbury's Home
Insurance, the slowdown in the housing market may be
having a direct impact on the nation's plans,
encouraging homeowners to make the most of where they
currently live rather than move. It appears that a
fifth (21%) of British homeowners plan to undertake
major structural changes to their properties in the
next 12 months. Sainsbury’s new research puts the
average amount to be spent on these changes at
£17,361 per household. Although nearly a fifth
(19%) of those who are planning works intend to spend
more than £20,000, 4% plan to spend over
£50,000 and 1% expect their works to cost between
£100,000 and £200,000.
Up to 5.3 million homeowners
intend to undertake some sort of major structural work
in the next 12 months. What is extremely encouraging
for the fenestration sector is that according to
Sainsbury's Home Insurance, 1.2 million of these
homeowners intend to erect a conservatory. That's an
incredible potential £9.6 billion of conservatory
sales. Even if this is a gross exaggeration, the
message is clear _ conservatories are still high on the
agendas of householders who are planning home
improvements. In Sainsbury's report, top of the list
are loft/roof conversions favoured
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by 1,344,000 homeowners. After
conservatories come rear extensions at 949,000; garage
extensions 713,000; side extensions 679,000; conversion
of outbuildings 554,000 and finally basement
creation/conversion 498,000.
Neil Laird, Home Insurance
Manager at Sainsbury's Finance said: “In the
current housing climate, creating extra space in your
home is another option for those who have maybe decided
to put their plans to move on hold. In addition, the
consequence for homeowners is that the additions of
extra rooms may impact on their insurance
premiums.”
In other interesting data
revealed in the Sainsbury's report, it was revealed
that conservatories are most popular in the South East
/ Anglia (397,000) and that loft and roof conversions
are more often planned by people in the North West
(260,000). Side extensions are most likely to be
carried out in the North East/Yorkshire and Humberside
region (256,000).
All this research makes very
positive and interesting reading. So are installers
right to turn their backs on conservatory sales?
This question and others relating to the current
market conditions were discussed by a number of the
South’s leading installation firms at a
recent industry forum held by a leading PVC-U trade
fabricator.
What was surprising was the
common belief that trading conditions had been holding
up for the first quarter of 2008. For one South-East
based company, the average conservatory order value was
£15,000 and window installations were running at
about £8,000. The key to this success was the use
of traditional sales channels and high calibre
sales-generating staff. Door canvassers were still
pulling in the leads and in some cases were earning up
to £3,000 per week in return for 50 leads per
week. Conversion rates for salespeople were still
running at around 1 in 3, although this did include
sales for a full range of products including windows,
doors, conservatories and porches.
Preferred methods
Different installation companies
have their preferred methods for generating leads, but
what was consistent with those that attended the forum
was the successful use of door canvassing, in-store
demonstrations and customer recommendations and
re-visits. All agreed that the free newspaper
advertising and internet promotions were generating a
limited number of leads. The internet is an interesting
one. Consumers are turning to the world wide web in
their droves to research and make purchases. However,
the number of direct leads finding their way to
installers is few and far between. It's an area that is
slowly improving and a number of attendees at the forum
were currently using www.trustatrader.com. No doubt there are regional
differences in sales techniques, but there is strong
evidence that door canvassing is still effective. New
products such as self-cleaning glass, composite door
and white woodgrain PVC-U windows have all helped to
expand customer choice and create greater desire and
interest. But it should also be remembered that
traditional products such as conservatories should not
be ignored. 1.2 million homeowners considering erecting
conservatories amount to a lot of potential business.
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