The survey we used to create the 2017 Remodeling 550 asked several dozen questions of America's biggest remodelers and their kin. And what we learned wasn't solely related to where companies ranked. Here are some notables finds that can help you understand your own company and then improve it.
The No. 1 through 100 full-service companies in the 2017 Remodeling 550 accounted for 69.7% of the $1.53 billion in total revenue for the group in 2016. The 10 biggest firms overall generated 21.4% of total revenues all by themselves. The second tier on our list provided 20.3% of all 300 companies' revenue, or nearly $311 million. And the bottom third delivered 10%; that's about $153.7 million.
Full-service remodelers and replacement contractors often have quite different predictions of their prospects, but this year's report shows consistency with regard to how much better 2017 will be than 2016. The top 300 full-service firms predict an 11.2% rise in revenues this year, while the 150 biggest replacement contractors are looking to grow by 12.1%. Within the full-service crowd, companies in 101st to 200th place predict 20% growth, much better than the top 100's 8.6% anticipated gain and the bottom 100's 11.7% expected rise. For replacement contractors, it's the bottom third that expects the biggest growth—a 25.8% increase—while the middle third forecasts a 9% gain and the top 50 predicts their revenues will rise 11.7%.
Americans will spend $31.2 billion in 2017 to remodel 1.8 million kitchens and 2.5 million bathrooms, according to a Farnsworth Group study commissioned by the National Kitchen + Bath Association. Thus, it's no surprise that kitchen and bath projects are the most popular work done by full-service remodelers, with 95.7% saying they work on K+B renovations and 14.7% doing kitchen cabinet refacing. Replacement contractors, on the other hand, are far more often found doing jobs involving the exterior of the house. Only 22.7% say they do K+B jobs and just 8% offer cabinet refacing.
Both size and style matter when you look at how big a share of revenue remodelers spend on marketing. Full-service remodelers and replacement contractors who are in the top third of their group spend a significantly higher share of their revenue on marketing than do their counterparts in the bottom third. But operating style is an even bigger factor, as even the bottom third of the replacement contractor list devotes a higher share of revenues to marketing than does the top third of the full-service group. That makes sense, because full-service contractors historically start by engaging with a customer and then deciding on a project, while replacement contractors begin with a service to sell and then go looking for customers.
|Full Service||Replacement Contractors||All Businesses||Business Type|
|*P=Private employers. C=Civilian employers, including state and local governments|
There’s scant consistency in the benefits offered by Remodeling 550 companies, except when it comes to the cost of the benefit. The top 300 full-service companies trail the top 150 replacement firms in their average likelihood of offering medical, life, and disability insurance and retirement plans. That’s no surprise; full-service firms tend to be smaller than home improvement shops. But full-service firms are even with replacement contractors in areas like vacations and sick days.
Time Off for Baby
Less than 30% of firms offer maternity leave to employees and fewer than 20% provide paternity leave: