Neil Cooper-Smith, senior analyst, Business Pilot
The Business Pilot Barometer offers monthly analysis of the key trends defining window and door retail. It draws on real industry data collated by Business Pilot, the cloud-based business management tool developed by installers, for installers.
Returning to offices and showrooms after three positive days at the Fit Show in Birmingham, it is reassuring to see that positivity reflected in the figures up to May 2023. As predicted, the ‘slowdown’ we saw in April 2023 was a blip.
Leads in May climbed 7% on April’s figure, bringing leads back in line with March 2023. When we track these figures against 2022, May 2023 is 23.1% up on the same period as last year. This runs counter to some anecdotal evidence in the industry that window companies are starting to see work dry up.
Once we get the elephant in the room out of the way – average sales – then the forecast for the second half of 2023 starts to look very encouraging. At 38.4%, average sales for May 2023 dropped 14.9% on April, which was to be expected given the fall in leads in April. But when compared to the same period last year, May 2023 was 8.9% up on May 2022.
Given that we’ve had an extra bank holiday for the king’s coronation, coupled with the other public holidays, this annual dip should not come as a surprise. When we look at other influences on household spending then the positive picture continues to emerge. For example, headline inflation has dropped to 8.6% and wholesale energy prices are dropping from the highs we experienced at the start of the year.
Since we’ve felt the sharp sting of inflated energy prices, now should be the time to push the energy efficiency message at the point of retail because people now have the money to invest – as well as the experience of energy-inefficient homes. Our figures prove that there is a desire among homeowners to invest in whole-house improvements: the average order value is up 25.9% in May 2023 on April 2023.
As we pointed out last month, those in the 50+ age group category are sitting on record levels of wealth. While they are less affected by high inflation, a drop in inflation to 8.6% could provide the stimulus necessary for them to invest. Coupled with a desire to improve on whole-house thermal efficiency following a period of high energy prices, this could be the boost that our industry needs.
Window companies appear to be capitalising on those opportunities. At 41.3%, the average conversion rate is 7% up in May 2023 on April 2023. Against May 2022, the average conversion is up 19% year on year.
On our stand at the Fit Show, we saw the appetite from owners and managers of window companies for both a broad product offering and greater control over business processes, since both are vital for maximising opportunities. With a sophisticated lead tracking capability, lead heat mapping and a sales pipeline management tool, Business Pilot helps you maximise leads, and supports their conversion through strategic data management and analysis. It also helps you maximise your profitability on every job, through drag and drop installation scheduling and real time financials.