The Hardware Journal continues its interview series sharing the insights, opinions and insider knowledge of leading figures drawn from all sectors of the hardware industry, ranging from merchanting to distribution. In the second of the series, The Hardware Journal spoke to Padraic McGuinness, Chief Operating Officer of The Albany Group, the home décor specialists with 30 stores nationwide.
The Hardware Journal : Could you give your overall assessment of the home decor sector in Ireland at the moment?
Padraic McGuinness: The home décor sector in Ireland is in an interesting place at present. In trading terms the sector has made a significant rebound from the darkest days of the recession which witnessed a contraction of some 40% in values in certain product categories between 2007 and 2012/13. While some higher end consumer items in the furnishings and fabrics category were hit very hard, the paints and general decorating categories were not as severely impacted as the general hardware and building materials sector was. I believe that Albany Home Décor’s strong dependence on paints has been a positive over the past number of years. However, other interiors goods and soft furnishings, particularly blinds, have become strong categories for the Albany group and help combat the seasonality of paint sales. Overall, across our 30 stores we have had had three consecutive years of growth in all product categories including paints, wallpapers, curtains and blinds, lighting and décor accessories.
Also, the home décor sector in Ireland has emerged from the recession in better shape than before. There is a greater emphasis on the quality end of the business with interior design and colour consultancy playing key roles. Product innovation and design has been a key feature in textiles and furnishings as well as in decorative paints. The consumer is more confident and informed now, and we see more unique requests for products than before.
We’re increasingly being told about how busy people’s lifestyles are becoming. Do you find that people are still making time for DIY decor or do they tend to employ trade professionals more these days?
It is an interesting question and on balance I believe both trends are evident. On the one hand, trade professionals are much busier in the past year to 18 months with domestic private work and, simultaneously, more and more retail customers are taking on décor projects also.
In particular, we have seen a growth in specialist and hobbyist tasks like furniture painting and upholstery. The chalk paint movement has been a major fashion trend and people are more informed and aware of the possibilities with paint these days. Another major DIY trend has been the application of bold colours to exterior fixtures like garden furniture and fences and sheds.
Do you see the popularity of home improvement, as indicated by the proliferation of design and home improvement TV programmes, translating into sales in your stores?
Most definitely…There is a much greater sense of style confidence and awareness of the possibilities of achieving ‘that designer look’ among the buying public. The media and TV attention to décor has been a great boost for the sector. We are in the fashion game ultimately, so décor and design celebrities drive public interest.
At Albany what’s the balance in your customer profile between the DIY-ers and the trade?
Our customer base is split roughly 70% retail and 30% trade but this can vary from location to location. The Albany stores have traditionally been a go-to supplier for the trade, especially in rural towns where there are no trade centres. We have been able to appeal to both customer segments as specialists décor stores offering service, product expertise and specialist ranges.
Do you have any informed estimates on the values of total national sales in the the key sectors within the home décor market?
These are our approximate figures for retail sales values in key categories in the Republic of Ireland (see table, below). I would stress that these are estimates only.
Taking each sector, and based on the over-the-counter data/ experience at your stores, could you highlight the most significant consumer trends in each of the above sectors?
• Paints – neutral colours combined with accent trims and feature walls; higher performance finishes and discerning finishes, e.g., flat matt and acrylic eggshell; environmental paints and anti-bacterial formulations; craft and hobby DIY painting projects, e.g., chalk paint applications and furniture painting. Generally, in paint there is a growth in the market share of designer and premium paints as customers are focused on quality and fashion-led colour pallets.
• Wallpapers – like paints, wallpapers are selling in greater volume in the designer end of the market. Also, more paper is being sold from sample books rather than stock collections. Innovation and design and branding in the wall coverings industry is also driving sales in the sector with examples like faux finishes and high resolution murals providing much greater choice for wall fashion.
• Lighting – low level lighting especially lamps are more popular; there is also a greater diversity of style in ceiling and wall light fitting design; light shades tend to follow fashion in colour and texture.
• Window furnishings – most notable trend in this category has been the growth in blinds over curtains, especially quality roller blinds and, more recently, in roman blinds. The trend has been towards the more minimalist and sharper look that blinds provide over the bulkiness of curtains and the greater colour choice available also. However, curtains have come back with better quality ready mades and greater design diversity. The custom-made curtain market is also showing signs of a resurgence as consumer confidence grows.
• Decorating tools – this category is not very prone to trends as it is very practical in its nature. However, from a market perspective there continues to be consolidation through acquisitions in the decorating ancillaries business with key brands like Purdy and Geocel being brought under the Sherwin Williams umbrella. Product innovation in brush and roller performance also continues to keep the category healthy and competitive.
Paints and lighting have clearly seen extensive design and technological developments in recent years. In terms of staff and sales training, does the increasingly sophisticated nature of the product create new challenges and how are leading companies such as your own meeting these training requirements?
In short, yes. There is always a challenge in meeting training and development needs to stay ahead of the standards and specifications in product innovation, especially in a technical sense but also in a customer service sense. The customer is now better informed, which is a positive thing but it also means that the queries are becoming more complex. This suits operators like Albany as we are specialist retailers, geared towards spending time with customers and helping them with their project rather than a ‘self-service’ model. We tend to largely rely on training and development support from suppliers and manufacturers
for technical expertise and some are better than others. We are also fortunate in that we have extensive expertise within our network and there is a strong culture of sharing information and knowledge between members of the Albany Group.
The wallpaper sector has been perceived as fashionably retro in recent times. What has been done to revitalise this sector and what innovation have you witnessed in it?
Well, if I interpret the question correctly, we are talking about retro design styles from the 1970s being popular and fashionable in wallpapers, as opposed to the whole wallpaper market suffering from backwardness! It is true that these bold patterns and colours have taken the wallpaper market by storm in recent years. We are now seeing clothing and accessory designs being brought across to wall coverings, like Orla Kiely for example. Also very intricate geometric designs are popular, which can have a retro feel to them and heavy Italian vinyls as a wallpaper type are also selling very well. All of this re-engineered ‘retro’ design code is helping wallpaper to be fashionable and current and it is working.
The wallpaper market has also seen a value shift. While actual volumes of rolls are nowhere near what they used to be 20 years ago, the average selling price for wallpaper is much higher. I guess many consumers are figuring that it is worth putting a high quality and classy paper up, given the big cost will often be labour and not the paper, at least in relative terms.
In its first 100 days, what one action could the next Government take to improve the business environment for the home decor market?
The formation of a stable Government will be critical to the economy and consumer confidence. Once that is in place I believe a targeted house building programme in a Public Private Partership model with strong local authority involvement will be the number one priority. In addition to this there is value in the VAT back Home Improvement Scheme and this should be extended. Finally, anything that can incentivise first-time buyers through mortgage interest relief and other improvement measures through the tax credit system. This could also be applied to derelict premises and buildings in our declining towns and villages for dual benefit.
TIME OUT – HOW THE ALBANY COO UNWINDS
• Favourite (or least favourite!) DIY project: Favourite DIY activity is gardening and least favourite is painting.
• Last book read: Le Freak , Nile Rodgers’ autobiography.
• Favourite movie: Sideways – with Paul Giamatti. It’s almost a documentary about wine, but very funny and moving throughout.
• Favourite TV series/boxset: Probably The X-Files , the 1990s original.
• Favourite holiday destination: Spain or Italy, hard to call it between them.
• iTunes or Spotify? I have to say iTunes as I have so much time and cost invested in it, but I guess I will eventually become a Spotify geek!