Monday, May 19, 2008

Home Improvement Centers at the Closing Bell Part 2: How this could work for you

So in my last blog post - regarding The Home Depot closing some of their stores - I made the comment, " wouldn't surprise me if Lowe's announced something similar."

I hoped not. But today they did.

Now if you just look at the numbers, and think of nothing else, it indeed seems scary. Lowe's reported an 18% drop in fiscal first quarter profit... ouch... net sales dropped 1.3% despite adding 150 new stores in the last twelve months... ouch again.

"Many consumers remain hesitant to begin big-ticket projects," said the Lowe's Chairman and CEO Robert Niblock.

Which brings to mind a question to those of you thinking of building a deck around your above ground swimming pool.

Just how "big ticket" is planning and building your own pool deck?

Now, I'm not there to look at your backyard and I won't guess as to what design you're considering. So I'm not going to give you a definite cost analysis. But as to what your deck budget could be, ask yourself some questions.
  • How much does it cost to plan your pool deck?
The answer is not much, if you plan it yourself. For this, your biggest expense will be time. That said, this can be done relatively quickly... like on a Saturday afternoon lets say... and it can be fun, something you do with friends or family or by yourself with a pencil and sketch paper.

Several of our opt-in newsletters offer tips on how to plan effectively and efficiently. And we posted a basic step-by-step guide regarding above ground pool deck blueprints.

But, if you want deck planning software this can be had for up to only $40 USD. Some are less than that. This is certainly reasonable if you're serious about building a pool deck.
  • How much are the tools and supplies?
How much do you already have? Look through your garage or tool shed. I bet you'll be surprised by how much you already have available. And I bet you'll be very pleased to learn that you won't need an arsenal of tools to complete the project.

If you're not sure of what tools are really necessary and you visit a home improvement center admitting your lack of knowledge, you're immediately at the mercy of a salesperson.

Do you really need to buy that super deluxe power saw? Can you just rent one?
Or do you already have an older one that works just fine, or is there one you can borrow?

Yes, your salesperson could be a good guy or gal who won't insist on loading you up with tools or supplies you really don't need. Then again, wouldn't it be better to know some things before hand?

As for supplies, like fasteners for instance, you'll know what's necessary once you plan and you can budget accordingly. I don't recommend being too much of a bargain shopper here, since I'll assume you'll want your pool deck to be safe and hold together.
  • How much will lumber run me?
Well, Lowe's also reported they were having difficulty passing along price increases to consumers... for things like lumber. But that may only last for so long. As the economy starts to improve they will eventually pass along prices.

So the contrarian in me thinks now may be a good time for you to find high quality lumber at good prices. There may even be some sales.

Also, if you learn how to spot defects in lumber you'll only get the best quality lumber available.

Knowing this ahead of time will save you money, and time, because your lumber will be strong enough to last and you won't need to discard weak lumber you've already acquired while you're building your deck.

With that all said, let me just remind you of something important...

Since home values are declining in many areas, now is actually a very good time for you to build an above ground pool deck. As I'm sure you know, anything that is up to code and adds value to your home is always a good thing... especially during times like this.

Also, according to the National Association of Home Builders you can recover up to 75% of the cost of your deck construction when you sell your home.

So if you're seriously thinking of building a pool deck... and if you already have the resources, plus you discover ways to build it efficiently so you don't have to make a huge investment... then my suggestion is you ignore the latest reports from places like Lowe's and just build it.

As always, enjoy your pool!

Best regards,

Paul Ottaviano

P.S. - Learn more about how to build a pool deck efficiently.

Friday, May 9, 2008

Home Improvement Centers at the Closing Bell: “Pool deck it yourself”

By now I’m sure some of you have heard the news that Home Depot is canceling 50 stores they had slated to open and they’re also closing 15 existing stores.

There is little doubt this move is related to the current economic challenges… particularly the credit markets which likely drive much of the home improvement spending.

As of this writing, I haven’t seen or heard other home improvement chains like OSH or Lowes make any announcements similar to Home Depot’s.

And without sounding any unnecessary alarm bells or starting false rumors, it would not surprise me if they did… I hope not… but it goes without saying there is a lot of corrective action being taken in the market right now.

What does this mean for us DIY builders and your above ground pool deck project?

Well, while things might sound really tough… the actual numbers don’t forecast endless gloom and doom.

Much of the deep pain has already been priced into many of the financial, homebuilder, and home improvement retailer stocks. There could be some additional bumps in the road ahead, but the worst appears to be over.

Home Depot, for example, still plans to open 55 new stores this year. For 2009 and beyond, they still plan 1.5% growth in square footage. True, it’s less growth than 2007 but they’re still growing. Which is of course preferable to the alternative.

The company will reduce capital spending by $1 billion over the next three years. This puts them in a healthier position moving forward to preserve capital and spend it in ways that ultimately benefit you, i.e. enough quality tools, supplies, and lumber to still help you build a good deck around your pool for a reasonable price.

So what else can you do?

Remember, in addition to places like Lowes and OSH, there may be local lumberyards and smaller home improvement stores in your area... and the Internet. It’s always a good idea for you to shop around for the highest quality product with good prices, but now that’s especially true.

Challenging economics may make it seem like now is the wrong time for you to do something… like build a pool deck. But if you think about it, you can paralyze yourself with analysis at any time… strong economy or not.

Also, while a lot of people are understandably concerned about the economy… unless you’re a Home Depot employee, investor, or live near one of the closed stores their recent announcement isn't going to affect you much.

There will always be companies there to supply your need for quality DIY products.

With that said, if you’re reading this then it's safe to say you’re likely very interested in building a deck around your pool. So if you think the time is right for you, you should go for it!

As always, enjoy your pool!

Best regards,

Paul Ottaviano

P.S. – For those of you wondering which 15 stores are being closed, here is the list, as announced by Home Depot:

Store #2015 East Fort Wayne, Indiana

Store #2032 Marion, Indiana

Store #2310 Frankfort, Kentucky

Store #379 Opelousas, Louisiana

Store #2819 Cottage Grove, Minnesota

Store #6901 East Brunswick, New Jersey

Store #6904 Saddle Brook, New Jersey

Store #6171 Rome, New York

Store #3702 Bismarck, North Dakota

Store #3874 Findlay, Ohio

Store #3865 Lima, Ohio

Store #4552 Brattleboro, Vermont

Store #4932 Beaver Dam, Wisconsin

Store #4933 Fond du Lac, Wisconsin

Store #4913 NW Milwaukee, Wisconsin