November 30th, 2017
Consumers are Doing Their Share
Cyber Monday, the recently traditional echo shopping day after Black Friday, set a new record this year, reaching $6.6 billion in sales in a single day. This momentous spending, combined with other indicators, show that the U.S. consumer is spending in ways that bode well for new construction and remodeling.
On a side note, roughly 25 percent of Cyber Monday online purchases were made with cell phones. If consumers are willing to make $1.6 billion in purchases in a single day using cell phones, it’s more urgent than ever for door and window manufacturers to ensure that their websites are configured to allow consumers to fully explore and evaluate their residential fenestration products on smart phones and tablets.
Returning to a higher level view of consumer spending, the recently released Consumer Confidence Index for November came in at 129.5, versus an expected decline to 124 for the month. Consumer confidence is closing in on its previous high of 132.6, which was reached in November 2000. The index began 2017 at 111.8, the starting point of a 15-percent increase to its current level.
This confidence has put consumers in a spending mood. Retail sales in the U.S. are brisk, exhibiting a faster growth rate than the average of the 10 years prior to the recent recession. In 2016, American consumers spent $1.5 trillion on durable goods, such as cars and large appliances, and $2.0 trillion on housing. Such consumer spending has risen throughout 2017. Armed with disposable personal income that broke an all-time record in May 2017, the American consumer is alive and well.
In summary, the vibrant health of the U.S. consumer will continue to drive sales for residentially focused door and window manufacturers over the next few years. With new U.S. home sales hitting a 10-year high this month, the American consumer is clearly doing their part on the new construction front. The NAHB’s prediction of growth in remodeling expenditures of 3 percent and 5 percent in 2018 and 2019, respectively, is also supported by the health of consumer spending.