Digging into how independent home improvement operations are performing throughout the year helps the entire channel understand how they compare to others in the industry and how to use that data to make improvements to their operations.
Since 2022, the North American Hardware and Paint Association (NHPA) has partnered with The Farnsworth Group to produce the Independent Retailer Index, which tracks key performance metrics quarterly.
Every quarter, the index asks independent home improvement retailers to share year-over-year changes in:
• Transaction count and size
• Inventory investment
• Cost of goods
• Profit margin dollars
• Future operational investments
We surveyed retailers on their performance in the fourth quarter of 2024 compared to Q4 2023. See highlights of the data here and download the full report at Your NHPA.org/retailer-index.
Respondent Profiles
A wide range of independent retailers participated in the survey, with over half of respondents from rural stores (57%) and almost two-thirds (65%) having just one store.
- 73% of respondents were store owners
- 41% have 11-50 full-time employees
- 26% have annual sales of less than $2 million
Changes in Total Sales (year over year)
30% of retailers saw year-over-year sales growth in Q4 2024, 7% higher than the previous year’s performance but lower than the 53% growth from two years prior. On average, total sales decreased 0.2% year over year, an improvement from Q4 2023.
Changes in Gross Profit Margins (year over year)
More retailers are seeing an increase in profit margins over both Q4 2023 and Q4 2022. The average change in profit margin is up from Q4 2023 (-3.0%), and now a positive at 0.4% average change.
Investment Plan for the Next 12 Months: Top Responses
As the new year is in full swing, here are the technology solutions respondents are planning to allocate funds to in 2025.
- Digital Marketing: 63%
- Web/E-Commerce: 58%
- Point-of-Sale System: 33%
- Task Management System: 21%
- Store Communications System: 17%
- Inventory Management System: 13%
- Miscellaneous: 4%
Dig Deeper
Download the NHPA 2025 Market Measure report, an annual overview of the state of the independent home improvement industry. This resource offers opportunities to look back at a year of changes, successes and challenges in the industry and provides insights into how things might change in the year ahead. Learn more at YourNHPA.org/market-measure.
Access the Index
Be sure you’re on the list to receive the newest data from the Independent Retailer Index quarterly. Head to YourNHPA.org/research to subscribe today.
