1. Copyright ©2004 Global Insight, Inc. Analyzing the Home Improvement Market Market Sizing and Forecasting Mike Sweet Senior Consultant, Business Planning Solutions Michael.sweet@globalinsight.com 781-301-9039

2. Copyright ©2004 Global Insight, Inc. Agenda  Capabilities and Approach  Case Studies

3. Copyright ©2004 Global Insight, Inc. Overview  We segment the market across a number of different dimensions:  Products and Services  End Purchasers –DIY, BIY, Contractors and Builders  Structure Types –New Residential, Residential Remodel, Non-Residential  Store Types/Distribution Channels  Geographic markets –Global, National, Regional, State and County

4. Copyright ©2004 Global Insight, Inc.  Premier economic analysis & consulting organization with 3,300 clients, 600 employees and 24 offices worldwide  Most comprehensive coverage of countries, regions and industries available from any single source  Common analytical framework and a consistent set of assumptions applied to diverse capabilities and products  The BEST track record among commercial forecasters. Wall Street Journal, January 2, 2004  Expertise Serving the Home Improvement Industry  Home Improvement Research Institute (HIRI) Developing an Outlook for the Home Improvement Market for over 10 years  Global Construction Study Sizing and Forecasting construction activity by structure type in 55 country markets  U.S. Construction Services Detailed forecasts and analysis on the U.S. construction market by structure type with state-level detail  Home Improvement Retailers and Manufacturers Product line forecasts and geographic market potential models

5. Copyright ©2004 Global Insight, Inc. Unique Value Proposition We explain how demographics, income, the macro economy and customer trends influence future demand for your products

6. Copyright ©2004 Global Insight, Inc. Transforming Information into Planning Solutions

7. Copyright ©2004 Global Insight, Inc. Where We Fit Into the Planning Process

8. Copyright ©2004 Global Insight, Inc. Developing Business Planning Solutions – A Proven Process

9. Copyright ©2004 Global Insight, Inc. Agenda  Capabilities and Approach  Case Studies

10. Copyright ©2004 Global Insight, Inc. Average Annual Growth 1997-2003 Average Annual Growth 2003-2006 Slowing Markets Recovering MarketsHigh Growth Markets Lagging Markets Average US Service X Growth 1997-2003 Average US Service X Growth 2003-2006 Los Angeles New York Chicago Boston Atlanta Orange County Denver Tampa -St. Petersburg Washington DC Newark Pittsburgh St. Louis Cleveland Seattle Detroit Philadelphia Minneapolis St. Paul Baltimore San Francisco Oakland Kansas Houston Phoenix Dallas San Diego Case Study #1 – Segmenting a Retailer’s Geographic End Markets

11. Copyright ©2004 Global Insight, Inc. Case Study #2 – Paint Manufacturer

12. Copyright ©2004 Global Insight, Inc. Case Study #2 – Paint Manufacturer Will over exposure in this channel hurt performance? Does lower penetration signal a potential growth opportunity?

13. Copyright ©2004 Global Insight, Inc. Case Study #2 – Paint Manufacturer

14. Copyright ©2004 Global Insight, Inc. Case Study #3 – Analyzing the Demographics of the Home Market  Second home demographic demand is growing nearly twice as fast as repeat demand and four times as fast as first time purchase demand  As the baby boom ages, second home demographic demand growth will remain strong.  First time demographic demand growth edges up as Generation Y starts forming households. Source: U.S. Census Bureau & Global Insight; age distribution data from The National Association of Realtors. Demographic Demand Growth