Strategic Planning in the Small Business

HO 2-4 (cootinued)

Unit

2

25-44-year-old

age group. This group

is important beciuse

they are more likely

to take on remodeling projects

than other

age groups.

The

segment of home improvement

outlays will increase

as the age ot the

stock of single-family homes

increases because

the older the hoases

the more repairs are

necessary. The high

cost of new construction

will discourage consumers

from buy­

ing new homes so the aging

of the housing stock will

continue.

Home improvement expenditures

also rise during

periods of

high

housing turnover. People

tend to make changes in

their

newl,-purchased

home to conform

with their tastes soon

after

they move

in. However, since a majority

of home improvement

projects represent

large expenditures,

consumers will commit

themselves

to such outlays when

the economy is perceived

to

be improving.

HAH is also

considering moving into

the ,uLmotivt parts

and equipment segment

of the do-it-yourself

market. The av­

erage sales for suppliers

of motor vehicle parts and

accessories

have

been forty billion annually

in recent years.

This annual

sum points

to attractive profit opportunities

available to inno­

vative and efficient

suppliers.

There are

a number of factors which

will affect demand

prospects for replacement

parts this year

and in the coming

years. These

factors include:

"A more prosperous

national economy

"A greater number

of vehicle miles traveled per car

"Changing fuel costs

"Deferral of repairs on cars

by some owners during the

reces­

sion

while others choose to repair

rather than replace their

cars

"A growing

number of vehicles while

the population of the

area is stabilizing

"More rapid parts

deterioration

There is indication

that modest long-term

growth trends

in unit demand for auto

replacement parts will continue,

re­

flecting

the steadily mounting

number of motor vehicles

in use

and

other factors already cited

above.

49

Chapter One Environmental

Analysis

192