The next Home Improvement Economic Summit is only 2 months away and we are beginning to formulate the itinerary which will include the panelists and topics being covered.
The program is being held in conjunction with the Remodeling Show and a ticket to the Summit will include complimentary access into the exhibitor area at the convention center.
Do you have any pertinent issues facing your business that you would like to see us cover?
Would you like to participate in the event as a panelist? Is so, what is your primary area of expertise?
Please contact me directly at (703) 591-2490 or dave@daveyoho.com.
In the interim, feel free to listen to this complimentary mp3 from the keynote address of this Spring's summit.
According to a recent article from the ARA – while foreclosures are at record rates the vast majority of homeowners are still current with their mortgages. Between the low interest rates and the fact that most of these homeowners are opting to remain in their current houses, it is providing more opportunities for home improvement and remodeling businesses.
There are several very distinct advantages for people to have various home improvements and remodeling projects done and upgrading one or more bathrooms are high on the list. Among the advantages are:
*People want to improve the value of their property during these recessionary times.
*People want to enjoy the benefits of a more luxurious living environment.
*People can recoup as much as 75% of a bathroom remodeling project’s costs when they resell their home as indicated in Remodeling Magazine’s 2008-2009 Cost vs. Value Report.
*People can realize savings in energy and resources consumption through upgraded “green” materials including ceramic tile, water-conserving fixtures and energy-efficient lighting
*People find that investing in baths and fixtures that create a spa-like environment provide a more relaxing experience in their own home, reducing stress and saving them the time and expenses of visits to spas and massage therapists. According to Steven Deland of Acryline Bath Systems, “Demand remains strong for tub experiences that really underscore hat feeling of spa like relaxation in the home bath.”
The U.S. has continually experienced cycles of economic upturn and downturn since World War II. On average, despite these cycles most homeowners have realized a doubling of their home value about every 11 years. Deland says, “Investing in your home is still one of the most sensible ways to spend your money and improve your life.”
There are always opportunities in every adversity. A solid plan, flexibility and innovation are important cornerstones of not only surviving, but also thriving during these challenging economic times.
Q. Will the Energy Star stickers on the windows (or other products) have to be submitted by the customer for their tax credit?
A. It is a good idea to have the customer keep the sticker off a window or the package of their product to substantiate their claim.
Q. How do I give credible information to the customer which eliminates my installation costs without jeopardizing my contract?
A. Construct a formula that is realistic and yet protects you. Give this to the customer as a receipt when they pay. Be sure your formula is fair, practical, and consistent.
There is a lot more information and the answers to more questions in the recorded proceedings of the first Home Improvement Economic Summit recorded in April 2009. The entire summit is available on 11 CDs plus an additional CD Rom with the Summit manual and 220 PowerPoint slides. For more information send an e-mail to admin@daveyoho.com or call our office at (703) 591-2490.
That’s all for this time. I’ll have more useful information in the next posting.
Let’s pick up where we left off in the last posting with some more questions and answers about the Energy Tax Credits.
Q. How do we present the tax credit to prospects?
A. It is best to have it as a page in your presentation book together with a copy of the certification they will receive. Prospects can be advised to search the websites listed in the last posting for the same purpose.
Q. Is there a special form that customers will have to submit with their tax return?
A. Currently, IRS Form 5696
Q. Suppose our product, i.e. bath refitting, coating, cabinet refacing, etc. doesn’t qualify as an energy saving product?
A. Start offering energy audits. You can use the H.E.L.P. package we’ve developed for this purpose. H.E.L.P. (Home Energy Loss Prevention) is a copyrighted package enabling those who sell windows with CDs, graphs, charts, support forms, energy audit folders and formulas to present this. Request information on H.E.L.P. with an e-mail to admin@daveyoho.com.
Q. Then what do we do?
A. Most bathrooms have a window. On the other side of the ceiling may be an attic (insulation). You can offer these products as a bonus or discount to help the energy crisis.
Q. Does the job then qualify for $1,500 tax credit?
A. Only the portion that relates to the energy credit that you installed.
Remember, you used energy conservation to get the lead and you have made them energy conscious.
Absorb these ideas and consider how you can implement them into your lead acquisition and sales appointment program.
We’ll answer some more questions in the next posting.
We discussed the excellent marketing potential the new Energy Tax Credits in the massive government stimulus package provide for us in the last posting. There is $6 billion available for home improvement manufacturers and retailers. In order for you to benefit from this opportunity, you need to be well informed and capable of showing the homeowner how they can gain the maximum benefit from this tax credit. So, in the next few postings, we’re going to ask the questions and answer them for you. So, let’s get started . . .
Q: What are the qualifications?
A:Qualified home improvement products installed between January 1, 2009 and December 31, 2010 on homeowner occupied residences.
Q: How much is the tax credit?
A: Homeowners can claim a tax credit of up to $1,500 representing 30% of the purchase price (not including installation costs).
Q: How do we know the product we’re selling qualifies?
A: Get certification from your supplier. You will need this if you’re challenged.
Q: Do we have to leave a copy of the certification with a customer?
A: It is advisable, although not required to send this in with their claim when they report their taxes. They should be reminded to keep a copy for that purpose.
Q: Which products qualify?
A: All products must meet a standard specified within the Act. Windows, doors, skylights, insulation, roofing, certain types of HVAC equipment and solar products.
Q: Where can we get more information on qualified products?
These next two Q’s and A’s are very important to understand and remember so the prospective buyer fully understands how they get their benefit.
Q: What is a tax credit?
A: Homeowners don’t receive the tax credit when they buy the Home Improvement project. They claim the credit on their federal income tax form at the end of the year – 2009 or 2010. The credit then increases the tax refund they receive or decreases the amount they owe.
Q: What is the difference between Tax Credits vs. Tax Deductions?
A: In general, a tax credit is more valuable then a tax deduction. A tax credit reduces the tax you pay, dollar-for-dollar. Tax deductions – (home mortgages or charitable giving) – lower the taxable income. If you are in the 35-percent tax bracket, the income tax you pay is reduced by 35 percent of the amount of the tax credit.
Let’s wrap it up here for this blog post. I’ll have more Q’s & A’s in the next posting
You are probably aware that there is an energy tax credit incentive for home owners built in to the government’s massive Stimulus Bill. Let’s recap this tax credit incentive and examine how this can be a massive opportunity for home improvement retailers.
First, it’s important to understand that this is a tax credit not a tax deduction. There is an important distinction here. A tax deduction means you deduct the prescribed amount from your taxable income before determining your tax liability. A tax credit means you reduce the tax liability you owe by the amount of the tax credit. Thus, if you have a $10,000 tax liability and a $1,000 tax credit, you only owe the IRS $9,000.00. This has huge implications for home improvement retailers.
Another important aspect of this tax credit is that it increases the cap from 10% to 30% for certain home improvement expenditures (energy conservation products.)
Here is a summary of the American Recovery & Reinvestment Act of 2009. The more significant incentives provided under the new law include:
Residential Energy Property Credit – Increased to 30%
The new law increased the Code Sec. 25C residential energy property tax credits from 10 percent to 30 percent, raises the maximum cap to a $1,500 aggregate amount for 2009 and 2010 installations, eliminates the $500 lifetime cap and makes several other modifications. The changes are effective for eligible property placed in service after December 31, 2008 and before January 1, 2011.
Note: Higher energy costs should accelerate the “pay-back” period for qualifying home improvements. The credit was in effect in prior years through 2007, but Congress allowed it to lapse for 2008. Pre-2008 credits are not counted toward the new $1,500 maximum.
Note: Improvements eligible for the Code Sec. 25C credit include insulation materials, exterior windows including skylights, exterior doors, central air conditions, natural gas, propane or oil water heaters or furnaces, hot water boilers, electric heat pump water heaters, certain metal roofs, stoves and advanced mail air circulating fans.
For more detail on these tax credits check out this Energy Star link
Residential Energy Efficient Property Credit
The new law removes the individual dollar caps under the Code Sec. 25D residential energy efficient property credit for solar hot water property, geothermal heat pumps and wind energy property. However, the new law places a $500 credit cap on qualified fuel cell expenditures.
Next time, we’ll answer some of the important questions about this terrific marketing opportunity.
A renowned philosopher once opined that, “in times of great change, it is the learners who have the greatest potential for success, for the learned find themselves equipped to deal only with a world that no longer exists.”
Join me, as we and others, not unlike Don Quixote, buckle on our armor and prepare to battle windmills. While we face the necessity of economic change, the windmills of doom and gloom keep turning. And as we respond to the call for ingenuity, creativity and change, while tightening our belts, the windmills, who create our laws and control the financial security of many with whom we do business, grind on . . . and on.
But, unlike Don Quixote, we have battled these forces before and won. We, the entrepreneurs, are the backbone of this $325 billion industry. We are ready to strive forward till we see the bright and shining El Dorado, which is our future.
In 2007, while researching for a book I authored entitled Why. . . Buy Replacement Windows? I found that there were 22 million windows manufactured for new home construction. During the same period, there were 33 million windows manufactured for replacement installations. The majority of these replacement windows were custom manufactured – to size – and delivered within two to three weeks from the time they were measured by a window expert and purchased by the homeowner.
In most cases, within four to six weeks from the time they were sold, they were installed in the home with little or no disruption to those living in the home – and – the windows replaced were removed and disposed of without damaging the environment.
The largest percentages of these windows enabled homeowners to live with less maintenance and contributed to energy loss reduction with great savings to those homeowners. Plus, the homeowners realized a healthier lifestyle.
This is, but one example. I could cite similar studies for insulation, roofing, heating/air conditioning, siding, gutters, cabinet re-facing, bath refitting and more.
Our industry took great products that might still be on a drawing board and created ways to get viable information to homeowners through creative marketing. We researched tools and equipment to complete the installation. We offered services that ranged from financing – to cost vs. value surveys – to customer service development. All of this, arguably, lifted this fragmented industry to become a cornerstone of the American economy.
A portion of our $325 billion total is comprised of D.I.Y. – do-it-yourself projects. Yet, the actions of promoting and advertising by retailers is what created consumer awareness, which, in turn, stimulated the D.I.Y. market and still does today. And, if you marvel at the growth of the “turnstile” end of the business through companies like Lowes, Home Depot and similar, you can thank the home improvement product and service retailers. They first took great products door-to-door to develop consumer interest and the appeal for so many of the products featured in the “turnstile” home improvement store of today.
Yes! We face economic challenges in our business and personal life. Yes! Our country is enmeshed in a crisis of transition and adjustment. And, yes, we are challenged by the lack of cooperative research and understanding by the political pundits as well as those we have elected. Irrespective of the political party, we have expectations that they will be practical, pragmatic lawmakers who see beyond personal opinions and purposes – to perceive the needs of ALL their constituency.
We ask lawmakers, the press, the public and others to give credence and understanding to our challenges in the home improvement industry and to recognize that we are a $325 billion dollar industry. We are fragmented at best, entrepreneurial in our composition, employers of millions and the progenitor of products and services that were created to enhance the value of homes and continue to effectuate the American Dream.
We drive the market with creative advertising, install the products with unbelievable efficiency and, usually, with little disturbance to the committed lifestyle of the owners.
Our efforts give employment to those in factories, shipping companies, toolmakers, insurance companies AND to many industries, some of whom have little understanding of who we are or what we do. Our efforts have led to improve the real estate values of homes and increased assessments and created taxes for the communities in which we operate. And, by the way, those we employ pay taxes as do we and our companies.
By the very title employed to describe us – entrepreneurs – we acknowledge our role in the business structure – for in truth – entrepreneurs have the power to turn around this economy. We have shouldered our responsibility in the past. We will do so again.
As you read in my last posting, I was commenting at the 2009 Home Improvement Economic Summit earlier this month, on those who denigrate, are critical naysayers and prophets of doom – usually the media.
I reminded those in attendance about a former, wordy Vice-President – I’m sure you remember Spiro Agnew. As you’ll recall, he eventually came into great disfavor and resigned from the second highest office in our country. Mr. Agnew labeled these purveyors of negativity I was speaking of, the Nattering Nabobs of Negativity. It really has a nice ring to it, doesn’t it?
No matter the ultimate downfall of Spiro Agnew, by our history, we understand that that the validity of any statement has little to do with the integrity of the person who made it. Facts still outweigh opinions and negativity is the enemy of your success potential.
Today we are excessively exposed to many nattering nabobs of negativity. They are in the person of our customers, employees, families and friends, the press and our leaders – many, who fall prey to this malaise and proceed to state their opinions as facts.
Why? I believe it’s because it is human – to believe and to want to believe that the newspaper, the radio and the television convey fact – and not to believe what you see and hear – which might demean you as ignorant.
Did you ever wonder why radio, newspaper and, particularly, television are each referred to as a medium. I believe it is a medium because it is rare that we see or hear news that is well done.
To prove my point, try this experiment for the next 21 days. Start telling your employees, associates, customers or clients – in fact, almost everyone you come in contact with:
That you – now know that in the U.S. we employ 92% of our employable workforce and that no country with a population of over 300 million has ever accomplished this.
Tell them that when our country is considered at full employment that the unemployment rate is normally at 4 to 4.5%.
Tell them that 90% of the mortgages in this country are paid on time.
Remind them that the highest percentages of mortgage defaults are in 2 states and a good percentage of foreclosures are on 2nd homes and vacations properties.
Remind them that in 1982 the unemployment rate in the U.S. was 10.7% and mortgages carried an interest rate of 15-20%.
Let them know that despite the demise of real estate values, most homeowners enjoy ownership and will continue to care for, maintain and improve their most valuable possession and the lifestyle it provides.
Portions of this last particular statement are supported by the Joint Center for Housing Studies at Harvard University.
Think about these statements and then consider if you want to buy into the, so called, facts we are hammered with from those nattering nabobs of negativity.
That’s right! The 2009 Home Improvement Economic Summit Conference is now part of the history books of our industry. On April 1st and 2nd, about 100 industry leaders representing the manufacturers, retail sellers, installers, trade media and providers of ancillary services to our industry, gathered at the Westfields Conference Center in Chantilly, VA. Additionally, we had industry experts who specialize in this industry in attendance and as speakers. They included an economist, a corporate lawyer, a CPA, a retail financing specialist, an energy specialist, an advertising specialist and Internet marketing specialists. This was a singularly powerful information event.
In future postings of this blog, you’ll read pieces of some of the massive body of information. But, to start off, here is a short piece from my opening remarks as I challenged those in attendance to participate with an open mind and be ready to consider new ideas during these critical times.
Abraham Maslow, a noted behaviorist who developed the theory known as “the hierarchy of needs,” also studied the concept of accepting new information. He concluded that you and I are at the top of our game when we reach that level when we are aware of – most – or almost all available knowledge in our chosen field. Maslow called this achievement our conscious competency. This is a time when you really know – and you know that you know – that you know. We’ve all been there.
Yet, Maslow dashes our hopes when he concludes that at this point in your learned process, you also measure any new information against that which you already know, thus, judging what is new – and most frequently settling for – what you already know.
Do not let it be denigrated or neutralized by the critical nay-sayers or the prophets of doom who permeate our sight and sound each day.
Some of these are in your own organizations or your circle of friends – while others are in the media – they, who by sight and sound, present themselves as expert prognosticatorsin a format where opinions are projected as facts.
The entire Summit Conference was recorded by Oakhill Press and is being produced into an eleven CD package with nearly 12 hours of vital information for anyone in the home improvement industry. There will also be a twelfth CD that will contain all of the PowerPoint presentations, some supplemental material and a special one hour bonus audio program. You can go to our Web site at www.daveyoho.com or call our office at (703) 591-2490 for more details.
The Home Improvement Economic Summit is upon us. April 1st and 2nd are rapidly approaching when the movers and shakers from the Home Improvement Industry will be gathering in Chantilly, VA at the Westfields Conference Center to discuss the current state and the future of this major economic force in our global economy.
This is no insignificant gathering of colleagues for the purpose of socializing and swapping war stories. The Home Improvement Industry annually represents an amount of revenue equal to nearly 50% of the amount of money the U.S. Congress recently authorized under the “Economic Stimulus Plan.
According to a recent release by the joint center of studies at Harvard University, The Remodeling Market in Transition – 2009, this giant industry has stimulated the market for home ownership, and created millions of jobs for manufacturers and those who install and service the products manufactured. The home improvement industry uses more building products then the new construction industry.
The US government and the media have taken scant notice of the issues and concerns of this great industry and therefore its future will be determined by the pioneers, innovators and creative marketers who have brought new products and ideas to the largest homeowner base in the world.
Highlighting the Economic Summit will be the presentation of the information contained in the Harvard Studies, regarding the remodeling industry.
Speakers at the Summit include:
Dr. Robert Geneski, internationally known economist, www.classicprinciples.com will lead the discussion on the economic issues which face the US with projections for the balance of 2009.
D.S. Berenson, senior managing partner of Johanson Berenson, www.johansonberenson.com will chair two panels introducing information regarding new tax laws, opportunities in the “green market” and new forthcoming legislation on the control of independent contractor status.
Additional panels on a wide range of economic issues will be chaired by industry leaders. Some of the topics include:
Energy Tax Credits and Marketing Them
Retail Financing in a Changing Market
Growing You Business in a Changing Economy
Internet Marketing
Diversity in a Changing Marketplace
I will act as the host of the Summit. It is my position that retail financing is a ‘must’ for those who labor in this industry at the behest of homeowners who require the ability to make sensible loans which enable them to keep their property maintained and energy efficient. Further, I believe that the ability to market products is severely impaired by the abundant negativity replete with doom and gloom expressed by congressional leaders and a sorely misguided media.
Those attending the Summit represent the most successful dealers, installers and manufacturers, all with an eye to strengthening the industry through creative and innovative new approaches to assist their customers in maintaining and improving the investment in their homes and increasing energy efficiency as part of a global initiative.
The Summit is being recorded by Oakhill Press and the proceedings will be available in CD format. Watch for complete details on this blog. And, stay tuned to the blog for a lot of great information and ideas to help improve your business and the economy as we release them.
Thank you for checking out the inaugural posting of this new blog created specifically for YOU, the Home Improvement Professional. Read on and learn how this blog is going to assist you and your business not only to survive, but to thrive during these challenging times.
This blog is your way to keep up to date on important issues, concepts and information that can impact your business. There is no need to belabor the fact that we’re going through an unprecedented economic event. The event has been called a crisis, a recession and some economists are even referring to it as a depression. Well, those are all just words. Another word that is just as relevantto you during this economic event is opportunity. As Napoleon Hill stated, “Every adversity, every failure, every heartache carries with it the seed of an equal or greater benefit.
So, through this blog you can expect to read powerful ideas and concepts you can put to work in your business. You’ll learn about events, seminars, conventions, shows and training programs that will increase your effectiveness and that of your people. There will be quick tips and techniques that we’ve used successfully at Dave Yoho Associates as well as proven ideas and tips from other business leaders both from within and outside our industry. You’ll read excerpts from interviews with successful home improvement business owners, sales managers, salespeople and other industry professionals. Our legal beagle, D.S. Berenson, will keep you on top of the law.
There may be days when several entries will be posted here. There may be a few days that pass without any new postings. But, rest assured, you will learn from the leaders - and - the movers and shakers in this great industry. We solicit your contributions, too. You’ll be able to make comments on what you read in the postings. You will find a place below each blog posting to leave a comment – please do so. We can’t encourage you strongly enough to participate. Your experiences, opinions and thoughts are important to everyone reading this blog.
You may also have some important information that is valuable enough to be a posting in itself, Don’t hesitate to contact our blog editor at admin@daveyoho.com and we’ll evaluate it and post your information as a guest contributor.
Finally, you will soon receive a notice about the new podcast we’ll launch in the very near future. The podcast will be available on a weekly basis and, once again, it will be targeted directly to you and your business in the home improvement industry. You’ll hear from me and many others including our blog contributors and other industry leaders. You’ll even be able to hear the actual recorded interviews with the people we excerpt and feature in blog postings.
What is the value of one great idea? You’re getting on the idea and information express track. You can count on current, up to the minute, cutting edge information that will not only help you weather this economic event, but reveal the opportunities to grow your business at a time when many around you will fall by the wayside. These information tools will benefit you most if you read the blog and listen to the podcasts regularly. When you APPLY them in your business, you’ll avoid many pitfalls and experience amazing growth while other businesses around you are floundering. I can’t emphasize, enough, the value of subscribing to this blog and to the podcast for FREE, so you have it delivered directly to your computers as soon as the latest postings and podcast episodes are released. We’re doing our part to help you grow your business. We can throw the ball to you. YOU have to catch it or you’ll miss the value!
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