2018
STATE OF THE INDUSTRYHOUZZ INDIA© Houzz Inc.

Big IdeasIdes
REPORTED INCREASE IN GROSS REVENUE FOR 2017
Three in five businesses reported an increase in gross revenue in 2017 relative to 2016 (61 percent), with nearly half of
those reporting that revenues increased by more than 10 percent (48 percent). Design build firms were most likely tohave seen revenue gains relative to 2016 (72 percent), followed by Interior designers and architects (61 and 56 percent,respectively).

CONTINUED GROSS REVENUE GROWTH EXPECTED IN 2018

The majority of businesses are optimistic about continued gross revenue growth (89 percent). Design build firms andinterior designers are most bullish in their expectations for increased gross revenue in 2018 (97 percent and 93 percent,respectively), followed by architects (86 percent). To support that growth, firms plan to invest in more marketing and bringin larger budget projects (each 58 percent).

INCREASE IN REVENUES IS NOT WITHOUT CHALLENGES
Nearly a fifth of businesses reported a surge in the cost of doing business in 2017 (19 percent), along with difficulty finding
prospective customers and increased business competition (38 and 24 percent, respectively). While managing customer
concern over cost continues to be a challenge (37 percent), the report shows a six percent point reduction from theprevious year (43 percent). Additional costs of doing business were felt most significantly by interior designers (25 percent),
whereas architects faced the most difficulty in finding prospective customers (42 percent).

2© Houzz Inc.

Expected Revenues & Profits in 2018
Charts below show the percentage of surveyed businesses on Houzz india reporting expectations for 2018 (vs. 2017).

EXPECTED GROSS REVENUES
84%

Expected changes in 2018

EXPECTED PROFITSExpected changes in 2017

89%

79%
70%

10%+ Rev. Growth11%

Increased

7%

5% 4%

No Change

Decreased

Expected by 76%of Businesses in 2018
(vs. 74% in 2017)20%

Increased

14%

No Change

10%

Decreased

INTERIOR DESIGNER
Expected Increases in 2018

ARCHITECTExpected Increases in 2018

DESIGN AND BUILD FIRM
Expected Increases in 2018

Gross revenues

93%

Gross revenues

86%

Gross revenues

97%

Profit (net income)

81%

Profit (net income)

72%

Profit (net income)

87%

37%

© Houzz Inc.

Top Growth Strategies in 2018
Charts below show the percentage of surveyed businesses on Houzz India expecting revenue growth in 2018 (vs. 2017).

TOP EXPECTED STRATEGIES TO GROW REVENUES

Expected strategies for 2018
Expected strategies for 2017

53%

58%

Bring in larger budget
projects

56%

58%

Increase marketing/sales efforts

57%

54%

49%

Improve customer
experience

43%

Offer new products/
services

38%

37%

Improve employee
productivity

42%

37%

Partner with otherbusinesses

INTERIOR DESIGNER
Top Growth Strategies for 2018

ARCHITECTTop Growth Strategies for 2018

DESIGN AND BUILD FIRMTop Growth Strategies for 2018

Bring in larger budget projects 62%

Bring in larger budget projects 57%

Increase marketing/sales efforts 69%

Increase marketing/sales efforts 62%

Increase marketing/sales efforts 47%

Improve customer experience 62%4© Houzz Inc.

Revenues & Profits in 2017
Charts below show the percentage of surveyed businesses on Houzz India reporting performance in 2017 (vs. 2016).

GROSS REVENUESGROSS PROFITS

Changes in 2017
Changes in 2016

54%

45%

61%

10%+ Rev. Growth24%

Increased18%

No Change

23% 21%37%

35%
28%28%27%

No Change

Decreased

Reported by 48% ofBusinesses in 2017(vs. 43% in 2016)

Decreased

Increased

INTERIOR DESIGNER
Reported Increases in 2017

ARCHITECT
Reported Increases in 2017

DESIGN AND BUILD FIRM
Reported Increases in 2017

Gross revenues

61%

Gross revenues

56%

Gross revenues

72%

Profit (net income)

41%

Profit (net income)

47%

Profit (net income)48%

5© Houzz Inc.

2017 Comparison to The Initial Expectations
Charts below show the percentage of surveyed businesses on Houzz India reporting how 2017 business performancecompared to the initial expectations for 2017 (vs. 2016).

GROSS REVENUES RELATIVE TO EXPECTATIONS

Relative to expectations for 2017
Relative to expectations for 2016

42%
30%
21%

31%

28%

22%
12%
7%

Significantly below
expectations

Somewhat below
expectations

INTERIOR DESIGNER
2017 Comparison

Met expectations

Met expectations

Somewhat above
expectations

ARCHITECT2017 Comparison

34%

Above expectations

15%

Met expectations

Significantly above
expectations

DESIGN AND BUILD FIRM
2017 Comparison

40%

Above expectations
64%

2%

14%

Met expectations

29%

Above expectations

23%© Houzz Inc.

Staffing & Business Costs in 2017
Charts below show the percentage of surveyed businesses on Houzz India reporting performance in 2017 (vs. 2016).

NUMBER OF EMPLOYEESCOST OF DOING BUSINESS

Changes in 2017
Changes in 2016

81%

60%
51%

60%

1-2 Employees

39%
23%

Increased

17%No Change

10%

32%

Hired by 8%of Businesses in 2017(vs. 8% in 2016)17%
2%

Decreased

INTERIOR DESIGNER
Reported Increases in 2017

Increased

ARCHITECT
Reported Increases in 2017

Number of employees

33%

Number of employees

Costs of doing business

50% Costs of doing business

7No Change

8%

Decreased

DESIGN AND BUILD FIRM
Reported Increases in 201739%

Number of employees

53%

61%

Costs of doing business84%© Houzz Inc.

Top Business Challenges in 2017
Charts below show the percentage of surveyed businesses on Houzz India reporting challenges in 2017 (vs 2016).

TOP CHALLENGES AFFECTING BUSINESS

Challenges in 2017
Challenges in 2016

38%

43%

37%

29%

32%
24%

24%
16%

Difficulty finding
prospective
customers

Consumers - overly Increased businessconcerned about
competition
costs

INTERIOR DESIGNER
Top Challenges in 201723%

Weak/uncertain
local economy

ARCHITECTTop Challenges in 2017

30%
22%

Weak/uncertainnational economy

21%

Difficulty collecting
payments

DESIGN AND BUILD FIRM
Top Challenges in 2017

Consumers - overly concerned about
costs 44%

Difficulty finding prospective
customers 42%

Consumers - overly concerned about
costs 48%

Difficulty finding prospective
customers 44%

Weak/uncertain national economy
33%

Difficulty finding prospective
customers 42%8© Houzz Inc.

Description of Businesses
Charts below show the percentage of surveyed businesses on Houzz India with the specific characteristics in 2017.

MORE THAN ₹50'00'000 IN GROSS REVENUES*ONE OR MORE EMPLOYEES*

47% of Businesses

88% of Businesses

Up to ₹10'00'00'000 or more in revenues*Up to 500 or more employees

TEN OR MORE YEARS IN BUSINESS*

SOLE OWNER RESPONDING TO SURVEY

41% of Businesses

60% of Businesses*Up to 30 or more years in existence9© Houzz Inc.

Methodology
The survey was sent to businesses with profiles on Houzz India and fielded between
December 5, 2017 – 22 January, 2018. N=196.

Description of Business Groups by Core Services*
Pro Categories in Survey (Sample N)

Top Pro Types in Survey (Sample N)

Architect/Designer (N=99)

Interior designer (N=60)

Design and Build (N=34)

Architect (N=36)

Speciality - Decorating (N=28)

Design and build firm (N=33)

Builder/Contractor/Installer (N=16)
Speciality - Building & Renovation (N=9)
Speciality - Landscaping & Outdoor (N=6)*Business groups were defined based on services that contributed to the largest share of business grossrevenues in 2017, as identified by respondents in the survey.
10© Houzz Inc.

Links to Pros on Houzz
Houzz is the easiest way for people to find inspiration, get advice, buy products and hire the professionals theyneed to help turn their ideas into reality.
Design, Renovation & Building

Home Improvement Services

Other Professionals

Architects & Building Designers

Furniture & Accessories

PhotographersInterior Designers & Decorators

Flooring & Carpets

Civil Engineers & Contractors

Bedding & BathDesign-Build Firms

Speciality Contractors

Home Builders & Construction Companies
Kitchen & Bath Designers
Landscape Architects & Contractors
Tile, Stone & Countertops

11© Houzz Inc.