Wednesday, June 20, 2007

Should You Have a Showroom?

A recent NKBA survey of nearly 700 dealers, designers, builder/remodelers, distributors, cabinet shops and fabricators offers some interesting insights into the showroom/no showroom question.
About 78.2% of those responding had a showroom.
Average annual sales for those retailers with showrooms was just under $2.6 million, while those without averaged $920,000 per year.
Retailers without showrooms averaged 1.3 customer encounters (prospects) per day. Those with showrooms averaged 61.5% more traffic, at 2.1 prospects per day.
Retailers without showrooms experienced a slightly higher closing rate, closing 34.7% of sales presentations, compared to a 29.7% closing rate for those with showrooms (average for all respondents was 31.9%).
Slightly more than three-quarters of those retailers without showrooms charge a design fee, compared to 58.4% of those with showrooms who do.
Retailers with showrooms average much higher design fees; $8,052 for kitchens by those with showrooms versus $1,759 for kitchens by those without showrooms. Average bath design fee for those with showrooms was $6,186, compared to $1,156 averaged by those without showrooms.
This suggests that prospects are more convinced by the concrete examples of design and product in a showroom, and are willing to make a higher cash commitment to their project.

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