Houzz: Growth strong for residential market Email
Thursday, March 12, 2015 06:23 PM

Healthy landscapesLandscape pros showed highest strength over other home-related professions (architects, interior designers, builders/remodelers, specialty trades, etc.) in 2014 with 84% reporting that annual revenues met or exceeded their expectation.

Comparative growth data for the residential landscape market and related professions was reported in the U.S. Houzz Barometer Highlights for February 2015.  Findings showed strength in the residential market during 2014 and point to continued, but more stable growth for 2015.  Stats reveal a variety of trends related to homeowner buying habits and that small landscape firms can expect company growth.

Revenue growth:  landscape pros reported the highest revenue growth among home-related professions in 2014 at 79% which was 6 percentage points higher than the next group which was specialty trades.

Conversion rates:  more than half of the firms said homeowners were more ready to commit to projects in 2014 than in prior years.  Landscape pros reported a 63% increase over the prior year.  

New projects and scale of projects:  landscape pros reported an 80% increase in number of projects and scale (price) of projects in 2014.  Landscape pros were a few percentage points ahead of architects, builders, and interior designers.

Profit and revenue:  across all professions polled, profit growth lagged behind revenues.  Landscape pros reported the highest growth in revenues at 79% and increased profits lagged at 73%.  The lag in profits was attributed to increases in overhead costs, products and materials prices and the costs of “red tape.”

Expansion of smaller firms:  across all industry groups, about one-third of firms with 1-4 employees increased their number of employees.  Stats showed that 36% of landscape firms with 1 to 4 employees increased the number or employees in 2014 and 50% of firms with 5 or more employees also increased their numbers.

Outlook for 2015
Across all professions polled, increased in revenue and positive rates of growth are expected for 2015, but only 4-6% of companies expect growth rates to exceed 50% in 2015 which suggests firms anticipate markets will stabilize in 2015.    Among landscape companies – less than 15% expect growth to be 25% or more.  The majority of companies anticipate slower growth:  about one-third of companies expect growth in the range of 5 to 13%.  One-fourth expect growth at 15 to 24%.

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