Head of sales & operations, Phil Croak explains why Kutchenhaus has now focused its business on the middle market
Owned by German kitchen furniture group Nobilia, Kutchenhaus always targeted the premium end of the retail market. However, in a bid to provide greater volume for its factory, it recently made the decision to target the middle market. “Previously we would probably target the top 8% of the market, which is fine and is a customer that will always have money to spend. The problem is the volume isn’t there. So we’ve had to now come into the middle market and go after the volume, and it’s been successful”, says head of sales & operations Phil Croak
But isn’t the middle market very competitive, with many kitchen furniture manufacturers and retailers targeting the masses? Croak tentatively agrees, but points out: “People have had to because that’s they know where the volume is. But where we are now, where we are positioned, we are very competitive within that market.”
Moving consumer markets
To make the move into the middle market, Kutchenhaus has not changed its kitchen offer but looked at how the business could attract a wider scope of customers. So the company has worked hard on showcasing the affordability of their kitchens by advertising its financial packages. Phil says 35% of its sales are on interest-free credit, and this has grown since Kutchenhaus opted to advertise finance products more readily.
In fact, Phil suggests its financial products have helped keep the business going over the last five years, particularly now the business has moved into a different market. And he suggests one of the first questions consumers now ask about is whether the company offers a finance package. Phil continues: “It’s all about trust at the moment. The consumer is not very trusting.”
Certainly the move from top-end into the middle market seems to have been successful for Kutchenhaus, as Phil concludes “Business is very good at the moment. We are currently up on last year about 30% up on last year. I would probably say we are slightly outperforming the market.
The full article appeared in the October 2013 issue of Kitchens & Bathrooms News