January 6th, 2011
Viewing $1,500 Tax Credit Expiration as a Positive
At the end of this past year, I was speaking to the owner of a long-time remodeling company. We were discussing the new version of the tax credit, and the fact that it has been significantly altered from the 30 percent, up to $1500, that our industry has enjoyed for the past two years.
A quick summary of the 2011 Energy Tax Credit is this – 10 percent up to $200 on Energy Star qualified windows and up to $500 on Energy Star qualified doors.
When discussing the new program, I was expecting this person to express his disappointment. But he surprised me with his comment, “Thank goodness that is over!” I was perplexed and asked him why is he happy that the $1,500 tax credit has been replaced with this new one.
He explained, “Now I can get back to marketing my company again.” He went on to say that the expiring tax credit was certainly good for business. But it also put his business on the same playing field as all the other home improvement companies out there. And to his credit, he believes his company is significantly better than his competitors. “And with everyone offering a $1,500 tax credit product, many times it just came down to price,” he said.
He explained that he has been in business for 20-plus years. He has strengths and weaknesses like all companies. But the tax credit certainly didn’t allow for him to take advantage of all of his strengths. By switching up the tax credit for 2011, it will allow him to use his marketing prowess and as he put it, “…to have even an better year in 2011!”
Frankly, I am hearing more and more stories like this. And many dealers that I have spoken with have a good bit of optimism entering the first quarter. There is strong momentum building, and with hard work, we can keep it going!