BMA CEO Tom Reynolds explains why the results of its latest consumer research gives the bathroom industry a clear reason to be upbeat
Readers of kbbreview don’t need to be told how bad the lockdown was for sales. As suppliers, the volumes leaving BMA members’ factories and warehouses in March and April fell to a small fraction of pre-COVID levels. As sales levels start to recover and we all try to salvage what we can from 2020, one of the biggest challenges is understanding exactly what demand looks like.
Our association is viewing more closely than ever the excellent economic modelling of fellow trade bodies like the Construction Products Association and Builders Merchants Federation. While these sources of intelligence can give a general feeling of confidence levels in the marketplace, they don’t tell us what sentiment looks like for our verticals within home improvement. To try and get a better understanding of consumer demand for bathroom fittings over the next few months BMA commissioned Opinium, an award-winning polling agency, to survey over 2000 nationally representative adults. This is a statistically significant sample, and a decent barometer of sentiment among the whole population.
When presented with a list of nine common bathroom refurbishments plans, our respondents were asked to indicate their likelihood to undertake refurbishments over a two-year time frame. Positively, nearly a third said they are likely to undertake a partial or full bathroom refurbishment in the next 12 months. One in five plans to have a full bathroom refurbishment within 18 months. This adds some weight to the hunch many in our industry have had that enforced confinement and limited spending on holidays could lead to a desire to upgrade living spaces.
However, this should be balanced out with the fact that on average, around three in ten adults indicated no plans to undertake bathroom improvements (30%), with just over a quarter indicating they were unsure when they would undertake these improvement plans (26%). Among those who did indicate a propensity to undertake bathroom improvement in the coming months, the average time to undertake any of the improvements is just over 19 months. Within this timeframe, repairing bathroom fittings (17.1 months), replacing shower controls (18.2 months) and completion of partial bathroom refurbishments (19.0 months) are of highest priority.
An interesting and unexpected insight from the study was that there is an insignificant difference in the average time before any bathroom improvements will be undertaken between homeowners and the population at large. This suggests both an appetite among tenants for bathroom improvement and a confidence they can get the jobs done in the same time, despite barriers such as landlord approval.
Our research with Opinium is admittedly a blunt instrument. The data we have gathered about consumer sentiment would have been many times more valuable if we’d had a pre-COVID version of the study to benchmark against. However, it is a starting point and becomes the benchmark for future surveys so we can understand the impact of the twists and turns in the recovery. Its also not out of step with earlier home renovation trends analysis, with similar research from 2018 reporting ~30% homeowners planned a bathroom refurb. The BMA/Opinium findings should also be considered alongside more detailed consumer studies in the offing from Trendmonitor and Eureka Research. These two pieces of work which BMA fully supports will shed more light on consumers’ and installers’ intentions in the months and years to come.
In addition to understanding consumer demand, the Opinium study was also an opportunity for the BMA to test some of the potential policy levers that we are advocating to Government to boost our sector. A potential VAT reduction was something we wanted to explore and our respondents indicated it could make a huge difference in accelerating their refurbishment plans. A quarter said they would be more likely to undertake bathroom refurbishments if VAT on bathroom products was reduced from 20 to 5 per cent. In terms of demographics, the increase in appetite was most closely association among homeowners, workers and those on lower incomes.
Interestingly, the overriding impact of a VAT reduction would be on the quality, use of professionals and speed of works. Four in ten state that they would increase their renovation budget if VAT was reduced. Just over a third (36%) stated that they would use the savings on additional renovation work, whilst one in five (20%) said they would improve the specification of the work. When presented with the prospect of VAT reduction, on average, around half of respondents (49%) who had previously said they would not hire a professional to complete works, claimed they would now do so. Similarly, over a third of respondents (36%) who said that they would not undertake renovation work within the next 3 months, stated that they would complete the work immediately rather than waiting. The research proves a VAT reduction would have a huge positive effect on preserving employment in the sector and would be a shot in the arm with an immediate effect.
As lockdown restrictions have eased, one of the challenges for bathroom manufacturers has been understanding demand. There have been some early causes for optimism in the market. This evidence reinforces our hunch that people stuck indoors for months might be thinking about upgrading their bathroom. There are still many unknown factors that mean we need to be cautious about the recovery, but this poll gives us a clear reason to be upbeat.