Following a Strong 2015, Firms Grow Headcount and Marketing Efforts
LONDON, May 10th, 2016 – The majority of UK home renovation and design businesses anticipate widespread revenue and profit growth in 2016 (75% and 70%, respectively), according to the 2016 Houzz UK State of the Industry study.
The report from Houzz Inc., the leading platform for home renovation and design, provides a review of 2015 and an outlook for 2016 for residential renovation and design businesses, including architects, based on data reported by nearly 500 UK-based professionals in the Houzz community.
Revenue growth expectations vary slightly by industry group. Growth is expected among 73% of architecture and design businesses, 76% of design and build companies, 72% of decor companies, and 69% for all other groups. Across the board, half of businesses in the Houzz UK community expect revenue to grow 10% or more (49%). To accomplish their projected growth for 2016, businesses plan to increase marketing/sales efforts (58%), bring in larger budget projects (48%), offer new products/services (38%) and improve customer experience (37%). Furthermore, over a quarter of professionals in the Houzz UK community plan to increase their headcount in 2016 (29%).
“With a community of more than 2 million unique monthly users and more than 40,000 active home professionals, Houzz UK has unprecedented insights into the health of the home renovation and decorating industry around the globe,” said Nino Sitchinava, principal economist for Houzz. “Our research points to healthy growth in 2015 among architecture, design, renovation, decor, and other small home-related businesses in the Houzz UK community, and a positive outlook for 2016.”
2015 in Review
2015 was a year of revenue growth for more than two-thirds of residential renovation and design companies in the Houzz UK community (71%) while 60% reported an increase in profits. Nearly three-quarters of companies in the Houzz UK community reported that revenues met or exceeded expectations in 2015 (73%). Revenue and profit growth was reported among 74 and 63% of architecture and design businesses, 74 and 61% of design and build companies, 66 and 52% of decor companies, and 68 and 57% for all other groups.
While revenue and profit increased in 2015, the cost of doing business also went up, according to 59% of respondents, driven by product/materials costs (50%), employee wages (47%) and marketing costs (37%). Many firms also hired employees to keep up with growth (29%), with over one in ten hiring three or more employees (12%). Meanwhile, just 4% of firms decreased staff size. Top challenges facing businesses in 2015 included managing consumers’ concerns around cost (39%), difficulty finding prospective customers (30%), managing consumers’ expectations (24%) and increased cost of doing business (23%).
Among businesses in the Houzz UK community, 41% have no employees and another 38% have between one and four employees. Across businesses of all sizes, more than two thirds plan to expand and grow in the next five years (69%). 63% of businesses in the Houzz UK community have been in existence for five or more years.
The full 2016 Houzz UK State of the Industry report can be supplied on request.
There are more than 1 million active home renovation and design professionals on Houzz globally, including architects, interior designers, home builders and design and build firms.
The Houzz UK State of the Industry Study was conducted among home renovation firms in the Houzz UK community that offer services related primarily to residential renovation and/or design. The study was fielded February 16-March 30, 2016. N=485
