Kitchen Cabinets in the U.S.

Aug 1, 2008
159 Pages - Pub ID: SB1812885
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The kitchen is the epicenter of modern American family life and the media’s makeover darling. In spite of all this attention and excitement, the kitchen cabinet industry may very well be in for a sustained slowdown according to a new report by Specialists in Business Information (SBI).

After several years of accelerated growth, apparent consumption of kitchen cabinetry in the United States eclipsed the $14 billion mark in 2006. However, homeowners reigned in spending and homebuilders pared back on construction bringing harder times to kitchen cabinet manufacturers bringing the market down an estimated 13% in 2007. With economic uncertainty and a housing depression unfolding into 2008, it’s pretty clear that the immediate outlook for the kitchen cabinet market looks bleak. But the real questions are when will there be a bottom and how soon will growth return?

This report presents data and analysis on the U.S. market kitchen cabinet manufacturing and its prospects for growth. It explores the key economic and housing related indicators, end-user, product and market trends with expanded coverage of green factors, and competitive issues affecting the kitchen cabinet manufacturing.

Report data were obtained from government sources, trade associations and publications, business journals, company literature, and investment reports. Statistics describing the value of shipments for kitchen cabinets are derived from the U.S. Census Bureau’s Census of Manufacturers and Annual Survey of Manufacturers, and are augmented by estimates and forecasts by SBI. In most cases, historical data are provided for 1998 through 2007, with forecast data from 2008 to 2012. Because some data are taken from the Census of Manufacturers, which is generated every five years for years ending in 2 or 7 (the last census being 2002), SBI occasionally includes 1997 to show an actual base. At other times, estimates for years falling between 1997 and 2002 were used.

Statistics describing the value of imports and exports for kitchen cabinets were derived from the U.S. International Trade Commission database. SBI defines the market for kitchen cabinets as apparent consumption, which is calculated as the value shipments, plus the value imports, less the value exports.

Other data analyzed in this report include several metrics describing residential construction and housing such as home improvement spending and new home sales.

Simmons Market Research Bureau’s winter 2008 survey, based on a sample of over 20,000 respondents, provides the primary research data on consumer remodeling habits and kitchen cabinet expenditures.
Chapter 1 Executive Summary
Scope of the Report
Methodology
Market Size and Growth
Market Drops 13% to $12.4 Billion
Figure 1-1 U.S. Kitchen Cabinet Value of Apparent Consumption 1998-2007
(in billions $)
New Home Market Drags Down Remodel Market
Figure 1-2 Total New and Remodeled Kitchens and Share of Total Kitchens
1998-2007 (millions units, percent)
Figure 1-3 U.S. Kitchen Cabinet Value of Apparent Consumption 1998-2007
(in billions $)
Market Forecast
Kitchen Cabinet Market to Reach $12.9 Billion
Figure 1-4 Projected U.S. Kitchen Cabinet Value of Apparent Consumption
2007-2012 (in billions $)
Economic Issues
Producer Prices
Lumber Prices Plummet, Provide Relief in Tough Times
Total Residential Investment and Rates
Figure 1-5 Comparison of Total Residential Investment, Residential
Improvement Spending, Average 30-Year Mortgage Rate and Average Prime
Rate 1990-2008, Quarterly (in billions $, percent)
Building Permits by Region
Residential Markets Head South
New Home Sales
Existing Home Sales
Home Maintenance and Improvements Lose Some Steam
Trends and Growth Factors
The Multi-Faceted Kitchen
My Lifestyle, My Ego, My Kitchen
The Outdoor Lifestyle
Design With Single Women In Mind
Baby Boomers Aging in Place
Universal Design
Remodeling Opportunities
DIY Home Improvement
Form Gets More Function
Consumers Comfortable With Color
Aesthetic Focus on Natural, Reusable and Sustainable
Clutter Leads to Increased Storage Needs
Mainstreaming Green
Market Outreach
Changing Distribution Landscape
Big Box Affecting Distribution and Manufacturing
Consolidation Affects Marketplace
Marketing and Promotion
Magazines and Websites
Trade Shows
Word of Mouth Goes Hi-Tech
Targeted End-User Marketing
Strange Cabinet Partners
Reality TV: A Product Placement Haven
Importance of Company Ethics
Consumer Home Improvement Activity
Household Remodeling Activity and Intent Stable
Bathroom Most Popular Improvement Area
Kitchen Cabinet Purchase Steady
Demographic Characteristics of Recent Kitchen Cabinet Purchasers
Household Expenditure on Kitchen Cabinets
DIY vs. Service-Supplied Kitchen Cabinet Work
Retail Preferences
Table 1-1 Percentage of Kitchen Remodelers, Planners and Cabinet
Purchasers Who Shopped in the Last Three Months, by Store, 2008
Chapter 2 Market Size and Growth
Scope of the Report
Methodology
Market Size and Growth
Market Drops 13% to $12.4 Billion
Figure 2-1 U.S. Kitchen Cabinet Value of Apparent Consumption 1998-2007
(in billions $)
Value of Trade Components
Table 2-1 U.S. Kitchen Cabinetry Value of Shipments, Imports, Exports and
Apparent Consumption, 1998-2007 (in millions $)
Imports Making Inroads, Capture 7% of Market
Figure 2-2 Kitchen Cabinet Net Shipments (Shipments minus Exports), by
Value and Percent of U.S. Apparent Consumption 1998-2007 (percent)
Figure 2-3 Kitchen Cabinet Imports, by Value and Percent of U.S. Apparent
Consumption 1998-2007 (percent)
Canada, China Top Countries for Imports
Table 2-2 U.S. Kitchen Cabinetry Value of Imports by Country of Origin 1998-
2007 (in U.S. $)
Figure 2-4 Top Ten Kitchen Cabinet Value of Imports by Country of Origin 2007
(percent)
Value of U.S. Exports Boom
Figure 2-5 U.S. Kitchen Cabinets Value of Shipments and Exports, and Exports
as a Percentage of Total Shipments, 1998-2007 (percent)
Table 2-3 U.S. Kitchen Cabinetry Value of Imports by Country of Origin 1998-
2007 (in U.S. $)
Figure 2-6 Top Ten Kitchen Cabinetry Value of Imports by Country of Origin
2007 (percent)
New Home Market Drags Down Remodel Market
Figure 2-7 Total New and Remodeled Kitchens and Share of Total Kitchens
1998-2007 (millions units, percent)
Figure 2-8 U.S. Kitchen Home Improvement Spending 1998-2007
(in billions $)
Market Forecast
Kitchen Cabinet Market to Reach $12.9 Billion
Figure 2-9 U.S. Kitchen Cabinet Value of Apparent Consumption 2007 to 2012
(in billions $)
Chapter 3 Competitor Profiles
Overview
Figure 3-1 Share of U.S. Kitchen Cabinet Sales 2007 (percent)
American Woodmark Corporation
Overview
Performance
Figure 3-2 American Woodmark Net Sales Fiscal Year-End April 2004-2008
(in millions $)
Figure 3-3 Percent Change in American Woodmark Kitchen Cabinet Unit
Volume and Price per Unit , Fiscal Year End April 2003-2008 (percent)
New Home Market Hits American Woodmark Hard
Figure 3-4 Share of American Woodmark Kitchen and Other Cabinet Sales by
End Market: New Home Building versus Kitchen Remodeling Fiscal Year End
April 2004-2008 (percent)
Figure 3-5 American Woodmark Customer Mix Fiscal Year End April 2008
(percent)
Product Highlights
Masco Corporation
Overview
Product Highlights
Performance
Figure 3-6 Masco Corporation Net Sales 2003-2007 (in billions $)
Figure 3-7 Masco Corporation Customer Mix 2007 (percent)
Figure 3-8 Estimated Masco Corporation U.S. Kitchen Cabinet Net Sales
2003-2007 (in millions $)
MasterBrand Cabinets, Inc. (Fortune Brands, Inc.)
Overview
Product Highlights
Performance
Figure 3-9 Fortune Brands, Inc. Home & Hardware Net Sales 2003-2007 (in
billions $)
Figure 3-10 Estimated MasterBrand Cabinets U.S. Sales 2003-2007 (in
millions $)
Norcraft Companies L.P.
Overview
Product Highlights
Figure 3-11 Share of Norcraft Sales by Brand 2007 (percent)
Performance
Figure 3-12 Norcraft Companies Net Sales 2003-2007 (in millions $)
RSI Holding Corporation
Overview
Product Highlights
Performance
Figure 3-13 RSI Holding Corp Net Sales 2002-2006 (in millions $)
Chapter 4 Economic Factors
Overview
2008 Real GDP Growth Forecasted at a Meager 1.1%
Figure 4-1 U.S. Current-Dollar GDP vs. Real GDP, 2000-2008 (in trillion $)
GDP Price Index Ticked Up
Figure 4-2 Percentage Changes in U.S. Current-Dollar GDP, Real GDP and the
GDP Price Index, 2002-2008 (%)
Economic Future Uncertain
Personal Consumption Slows
Figure 4-3 U.S. Current-Dollar vs. Real Personal Consumption Expenditures,
2000-2007 (in billion $)
Figure 4-4 Percentage Changes in U.S. Current-Dollar vs. Real Personal
Consumption Expenditures and Inflation, 2001-2008 (%)
Kitchen Cabinets and the Economy
U.S. Dollar Decline
Figure 4-5 Federal Reserve Bank of Atlanta’s Trade-Weighted U.S. Dollar
Index, January 1995-May 2008 (index)
Producer Prices
Figure 4-6 Wood Kitchen Cabinet and Countertop Manufacturing Producer
Price Index and the Wood Kitchen Cabinets and Cabinet Work Commodity
Index 1998-2008 (index)
Figure 4-7 Percentage Changes in the Wood Kitchen Cabinet and Countertop
Manufacturing Producer Price Index and the Wood Kitchen Cabinets and
Cabinet Work Commodity Index, 1998-2008 (%)
Lumber Prices Plummet, Provide Relief in Tough Times
Figure 4-8 Hardwood and Softwood Lumber Commodity Price Index 1998-2008
(index)
Figure 4-9 Percentage Changes in the U.S. Hardwood Lumber and Softwood
Lumber Commodity Price Index, 1998-2008 (%)
Housing Market Trends
Total Residential Investment and Rates
Figure 4-10 Comparison of Total Residential Investment, Residential
Improvement Spending, Average 30-Year Mortgage Rate and Average Prime
Rate 1990-2008, Quarterly (in billions $, percent)
Building Permits by Region
Figure 4-11 U.S. New Housing Units Authorized by Building Permits, January
1998-April 2008 (in thousands of units)
Residential Markets Head South
New Home Sales
Figure 4-12 Seasonally Adjusted Annual Rate of U.S. New Single-Family Home
Sales by Region, January 1998-May 2008 (in thousands of units)
Figure 4-13 Annual U.S. New Home Sales by Region, 1963-2007 (in thousands
of units)
Existing Home Sales
Figure 4-14 Annual U.S. Existing Home Sales by Region, 1997-2007 (in
thousands of units)
Pending Home Sales
Figure 4-15 U.S. Pending Home Sales Index by Region, 2004-2006, January
2007-May 2008
Home Maintenance and Improvements Lose Some Steam
Figure 4-16 U.S. Quarterly Expenditures for Home Maintenance/Repairs and
Improvements, 2004-2007 (in billion $)
Chapter 5 Trends and Growth Factors
The Multi-Faceted Kitchen
My Lifestyle, My Ego, My Kitchen
Service Me!
Design Me!
Customize Me!
Virtual Cabinets
The Outdoor Lifestyle
Design With Women In Mind
Baby Boomers Age In Place
Boomers Prefer Staying Put, Investing in Home
Universal Design
Remodeling Versus Refacing
DIY Home Improvement
Form Gets More Function
Consumers Comfortable With Color
Aesthetic Focus on Natural, Reusable and Sustainable
Clutter Leads to Increased Storage Needs
Getting Green
New Infrastructure for a Green Market
The Consumer Has Spoken…a Little
Differentiating What is “Green”
The Coming Residential Wave
Manufacturers Pour on the Green
Can Green Boost Kitchen Cabinet Industry?
Green Opportunity For Small Businesses
Self-Cleaning Paints
Chapter 6 Market Outreach
Changing Distribution Landscape
Big Box Affecting Distribution and Manufacturing
Consolidation Affects Marketplace
Marketing and Promotion
Magazines and Websites
Trade Shows
Word of Mouth Goes Hi-Tech
Targeted End-User Marketing
Strange Cabinet Partners
Reality TV: A Product Placement Haven
Importance of Added Values
KCMA Making Green Inroads
Importance of Company Ethics
Chapter 7 Consumer Home Improvement Activity
Note on Simmons Market Research Bureau Consumer Data
Household Remodeling Activity and Intent
Table 7-1 Percentage of Households Who Did or Plan to Do Remodeling, 2004- 2008
DIY vs. Service-Supplied Home Improvement Work
Table 7-2 Percentage of Households Who Did Work Themselves or Hired a
Professional, 2004-2008
Demographic Characteristics of Recent Remodelers
Table 7-3 Demographic Indicators for Households Who Have Remodeled in the
Last 12 Months, 2008 (index)
Table 7-3 (cont.) Demographic Indicators for Households Who Have
Remodeled in the Last 12 Months, 2008 (index)
Demographic Characteristics of Future Remodelers
Table 7-4 Demographic Indicators for Homeowners Who Plan to Remodel in the
Next 12 Months, 2008 (index)
Home Improvement Expenditures
Table 7-5 Percentage of Homeowners Spending on Home Improvements in
Last 12 Months, by Spending Range, 2004-2008
Home Improvement Activity By Room and Intent
Table 7-6 Percentage of Homeowners Who Remodeled in Last 12 Months, by
Room, 2004-2008
Table 7-7 Percentage of Homeowners With Plans to Remodeled in Next 12
Months, by Room, 2004-2008
Demographic Characteristics of Recent Kitchen Remodelers
Table 7-8 Demographic Indicators for Households Who Have Remodeled
Kitchen in the Last 12 Months, 2008
Demographic Characteristics of Future Kitchen Remodelers
Table 7-9 Demographic Indicators for Households Who Plan to Remodeled
Kitchen in the Next 12 Months, 2008
Other Kitchen Improvement Specific Product Activity
Table 7-10 Percentage of Total Population Who Purchased Kitchen Products in
Last 12 Months, 2004-2008
Table 7-11 Percentage of Kitchen Remodelers and Cabinet Purchasers Who
Purchased Kitchen Products in Last 12 Months, 2008
Demographic Characteristics of Recent Kitchen Cabinet Purchasers
Table 7-12 Demographic Indicators for Households Who Bought Kitchen
Cabinets in the Last 12 Months, 2008
Household Expenditure on Kitchen Cabinets
Table 7-13 Percentage of Kitchen Remodelers and Cabinet Purchasers
Spending on Kitchen Cabinets in Last 12 Months, by Spending Range, 2008150
DIY vs. Service-Supplied Kitchen Cabinet Work
Table 7-14 Percentage of Kitchen Remodelers and Cabinet Purchasers Who
Did Kitchen Cabinet Work Themselves or Hired a Professional, 2008
Retail Preferences
Table 7-15 Percentage of Kitchen Remodelers, Planners and Cabinet
Purchasers Who Shopped in the Last Three Months, by Store, 2008
Table 7-16 Percentage of Kitchen Remodelers, Planners and Cabinet
Purchasers Who Purchased in the Last Four Weeks, by Store, 2008
Appendix Selected Addresses

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