Is Tesco the future of the home improvement industry?

The home improvement industry has never had a big name behind it. Sure, companies like Anglian and Everest are well known, but they are not a global brand.

So what happens when a business that everyone knows and trusts, and most people trade with, and that holds a world-class brand, enters the home improvement market?  What happens to established window installers, many of which are struggling to generate enough business as it is?

I am talking about Tesco of course.  The global brand that generates £1 billion sales per week and makes circa £3.5 billion pre-tax profit per year – greater than the entire size of the window industry.

Tesco Home Services has now launched and promises to provide homeowners with quality home improvements through a network of approved partners. Oh, and Tesco Clubcard points too.  If and when Tesco roll this out nationally, it could change the home improvement industry.

The implications are far reaching.  Installers who sign up as partners could have all the sales leads they could ever cope with, and sales conversion rates they can only dream about.  Homeowners trust Tesco. So will this benefit or mark the end of organisations such as the Double Glazing & Conservatory Ombudsman Scheme? (DGCOS), Insurance Backed Warranty providers (IBG’s) and online lead generation sites? What about the product manufacturers? Will Tesco control the supply chain?

Many won’t take this move seriously. But this would be a mistake.  With over 280,000 UK staff, along with their family and friends, they already have a captive market before launching the service.

So why has Tesco moved into home improvements? Well why not. They have recently launched their own record label, movie company, and a chain of hairdressing/beauty salons. They acquired a 24-strong chain of major garden centres. And Tesco Bank provides mortgages, loans, credit cards and insurance. Lots of insurances. So why not home improvements?

It won’t happen overnight. But it will happen. I would welcome your views on this, please comment below, and you can visit the Tesco website here:  www.tesco.com

Andrew Scott, Managing Director, Insight Data Ltd.

Market research, trends, and analysis for the window and conservatory industry. www.insightdata.co.uk