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Scouting trends in the bathroom

BY Kate Fazzini

Futuristic toilets and state-of-the art bathtubs are familiar trends at the Kitchen and Bath Industry Show (K/BIS), held last month in Chicago. This year, new colors and technological advances were two top highlights in the toilet and bath categories.

One of the most notable trends on the show floor was in bathtubs, particularly high-end models that played on the consumer preference toward more choice. Manufacturers including American Standard and Jacuzzi offered a host of new models with new choices in color and more varied functional controls. Others featured innovative—and sometimes novel—ways of looking at relaxation, including expanded lines of light “therapy” models from Kohler and TOTO.

At American Standard’s Porcher brand, a cast-iron tub offered an exterior that can be painted by interior designers any color to match a customer’s specifications. This tub, like many new models at the show, was a stand-alone model meant for soaking.

“Consumers tell us they would like a deeper soak,” explained Gray Uhl, director of design for American Standard. “This also gives the opportunity for a designer or decorator to paint the outside of the tub for a more dramatic effect.” In this case, the bathtub was painted black and presented in a black and white bathroom vignette.

“Black is on the rise. It’s something we see first in commercial applications that is moving into the consumer side,” Uhl said. That demand is carried through to other bathroom fixtures, including darker finishes on bath hardware and in porcelain items such as toilets.

Other companies at the annual event concentrated on introducing touch panels and other high tech features to the bathroom. Jacuzzi, which offers its line of products through Lowe’s and Fergus on stores, featured a number of new products, including a tub from the Fuzion collection that featured a combination of both air and water jets, as well as a control panel that operated in a way similar to the scroll wheel of an iPod. The trend of the circular-scroll interface was repeated in many other products at the show, from refrigerators to washers and dryers.

“It’s intuitive, and consumers are used to operating controls in this way, and they’re very familiar with the iPod. People are very used to this kind of technology, they’re comfortable with it,” explained Rose Boyd, product and strategy manager for Jacuzzi Bath Products.

The manufacturer, which is focusing on expanding its Italian-made line of bathtubs, toilets and showers in the United States, also shrunk its luxury Fuzion model to fit into a wider range of bathroom sizes. The company also introduced an ADA compatible walk-in tub, the Finestra, with a 256-color “chromatherapy” feature.

“Chromatherapy,” which integrates colored lamps into bathtubs and showers, has been a growing trend in both baths and faucet fixtures. Kohler has been no stranger to the chromatherapy trend—one high profile example has been its VTS line of fully programmable showers, which include a touch pad, chromatherapy controls, steam room and temperature controls.

Aside from the lighting features, Kohler has also carried the technology trend through to toilets as well this year—in that case, technology used to appeal to customers who are concerned with keeping the bathroom clean. Kohler introduced a hands-free toilet seat that automatically lifts up and down and includes an automatic flush feature.

On the lower-cost side of the anti-germ movement, Bemis Manufacturing introduced a new toilet seat hinge with no visible hardware or fasteners, meant to provide an easier-to-clean surface.

Easy-to-clean surfaces also were a selling point of new one-piece models from Jacuzzi, Kohler and American Standard. The streamlined look of one-piece toilets has been catching on with consumers, said Eric Moore, an interior designer with Kohler.

“The one-piece models are especially popular with people who either want a streamlined look, or who want some thing that’s much easier to keep clean and to keep looking clean,” Moore said. At the show, Kohler introduced its first one-piece dual-flush toilet, a model that is certified under the Environmental Protection Agency’s new Water Sense guidelines.

Dual-flush Water Sense toilets were featured by numerous manufacturers, at price points from high to middle to low. At TOTO, known for its high-tech bidet features and modern Asian designs, the Japanese manufacturer introduced the “Neorest” line of fully-automated bathroom products, mixing the eco-friendly and technology trends. The compact toilet includes a wireless remote that can activate one of two dual-flush choices or lift the lid up or down.

Harkening back to the emergence of black in the bathroom, several manufacturers featured black new products. Unlike many kitchen appliances and housewares products, where a colorful palette has been a years-long trend, color in toilets and baths has remained relatively staid at white or off-white. This year’s show, however, featured several toilet and bath models in more varied hues, especially black. According to research firm Synovate, unit share of colored toilet models is up slightly year-over-year to 14.3 percent of sales in 2007 from 13.4 percent the previous year.

Home Depot carries several of Kohler’s black one-piece and two-piece models, including the Serif, Wellworth and Rialto collections. American Standard’s Town Square “Right Height” and Repertoire toilets are also available in black at the retailer, and, for both brands, the black models run at a significantly higher price-point than their white counterparts.

The black trend will be a primary one to watch in the future. According to research from NPD Group, the popularity of black stretches into the washer/dryer and kitchen categories. For example, unit share of refrigerator sales are up 13 percent in black and down 7 percent in white. For washing machines, sales of black units are up 113 percent and flat for white.

These new trends will undoubtedly be highlighted as consumers look toward ways to improve their homes in the next year. Finding a market share niche will be important—according to K/BIS research, bathroom remodeling projects overall are expected to fall by 14 percent in 2008, but do-it-for me projects for bathrooms are expected to grow by 22 percent. In all, kitchen and bath do-it-for-me projects are expected to rise by 12 percent in the next year.

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Home Depot to close 15 stores

BY HBSDEALER Staff

Home Depot will close 15 underperforming stores, the company has announced, and remove 50 future openings from the new store pipeline. The closings will include layoffs of about 1,300 employees.

The closings, at locations in the Midwest and Northeast, will generate approximately $547 million in pre-tax charges in the company’s first quarter. The company will release first-quarter results on May 20.

The stores to be closed are as follows:

• Store no. 2015 in East Fort Wayne, Ind.

• Store no. 2032 in Marion, Ind.

• Store no. 2310 in Frankfort, Ky.

• Store no. 379 Opelousas, La.

• Store no. 2819 Cottage Grove, Minn.

• Store no. 6901 East Brunswick, N.J.

• Store no. 6904 Saddle Brook, N.J.

• Store no. 6171 Rome, N.Y.

• Store no. 3702 Bismarck, N.D.

• Store no. 3874 Findlay, Ohio

• Store no. 3865 Lima, Ohio

• Store no. 4552 Brattleboro, Vt.

• Store no. 4932 Beaver Dam, Wis.

• Store no. 4933 Fond du Lac, Wis.

• Store no. 4913 Milwaukee, Wis.

Home Depot said in a statement it still intends to build 55 new stores this fiscal year, including 36 new stores in the United States.

As for other stores in the works, the company said it has “determined that it will no longer pursue the opening of approximately 50 U.S. stores that have been in its new store pipeline, in some cases for more than 10 years. Accordingly, the company will record a charge of approximately $400 million related to capitalized development costs and ongoing obligations associated with those future store locations.”

“This is a continuation of our disciplined approach to capital allocation that we outlined last year,” said Frank Blake, Home Depot chairman and CEO, in a statement. “We will invest in our core retail business, in this case our existing stores, which drive our most profitable sales. Our capital efficiency model will also provide improved returns for our shareholders through dividends and share repurchase.”

Home Depot added that investments in existing retail stores will continue to include “maintenance, merchandising resets and other initiatives to improve all elements of the customer’s shopping experience.”

The company reiterated that its total capital spending for the current fiscal year is projected to be approximately $2.3 billion, down from $3.6 billion last year.

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Sherwin-Williams earnings fall in the first quarter

BY HBSDEALER Staff

Sherwin-Williams saw earnings fall in the first quarter of 2008, but the worldwide paint and coatings giant is still seeing strength in international sales.

Earnings fell 30.3 percent in the first quarter to $77.9 million from $111.8 million in the same period last year. Net sales grew just over 1 percent to $1.78 billion from $1.76 billion in the same period last year.

The stronger net sales were in large part due to strong Global Group sales, as was the case last quarter. Favorable currency rates and eight acquisitions since last year’s first quarter helped aid international sales, according to the paint company.

In the company’s retail Paint Stores Group, net sales were $1.031 billion in the quarter, 1.9 percent lower than in last year’s first quarter. Sales were weak due to “soft architectural paint sales and weak sales in non-paint categories partially offset by improved industrial maintenance product sales.”

Same-store sales decreased 6.5 percent compared with last year, and earnings decreased 31.9 percent. Earnings were weaker because of increased product and freight costs, the company noted.

The company’s Consumer Group, which includes paint products like Dutch Boy, saw sales decrease 4.8 percent in the quarter to $286.9 million. The sales decline was due primarily “to soft DIY demand at most of the segment’s retail customers.” Earnings in the Consumer Group were down 23.7 percent due to higher raw material costs, as well as a lower volume of movement at the company’s distribution centers.

The Global Group’s net sales increased 14.8 percent to $461.9 million due to market share gains, selling price increases, favorable currency translation and acquisitions. Earnings for the Global Group increased 21.7 percent to $7.7 million.

“Paint demand in the domestic new residential, residential repaint, DIY and commercial markets was weaker during the first quarter than we had anticipated at the start of the year,” said Christopher Connor, chairman and CEO of Sherwin-Williams. “We continue to be pleased with the strong sales improvements of the foreign business units in our Global Group and the continued growth they have been achieving in the architectural, industrial maintenance, OEM and automotive finishes product lines.”

Connor also noted that the Paint Stores Group opened 17 new stores in the first quarter and closed 23 “redundant stores.”

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