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Independent retailers are coming into 2026 with a cooling renovation market and a cost-sensitive customer with a shift toward DIY. Dave King, executive director of the Home Improvement Research Institute (HIRI), says those pressures hit independent retailers differently than big-box chains because they have less pricing power when customers start shopping harder for value.
King says the slowdown in large projects is consistent with the broader pattern they’re watching across national sales data. Retail revenue is mostly flat in dollars, but down in product volume, accounting for inflation. Larger ticket items are where the pullback sits.
“The bigger the dollar amount, the more individuals are saying now isn’t the time to start a project,” King says.
In HIRI’s Q3 Project Activity Tracker, 69% of homeowners say the quarter wasn’t a good time to start a large-scale project. King says that mindset won’t disappear coming into the new year. Real disposable income hasn’t kept pace with higher product and housing costs. As pricing is top of mind for consumers, King says independents have an advantage: customer service. Independents are better positioned to guide shoppers through price tiers and explain what matters at each level.
“Where we see clear evidence of independents winning is in customer service,” he says. “If we can get our independents to really help the consumer understand the different tiers and what you get and don’t get, and where the trade-offs are, I really think that would help consumers and play into the strengths of the independents that I’ve witnessed.”
On the opposite end, King says the pros are also feeling pressure too, and that shows up in foot traffic. As homeowners pull back from hiring contractors, pros compete harder for the limited work available.
“Pros are shopping around more to get better pricing, because it’s being demanded of them by their customer,” he says.
Digital capabilities also play a major role in who keeps the market share. Many shoppers won’t visit a store unless they can see the price and inventory first.
“If you’re not able to communicate that you have inventory available and what the price of that inventory is online, my guess is you’re hurting drastically more,” King says.
Looking forward to 2026, King sees a steady but cautious market. Homeowners will continue delaying big-ticket renovations and proceed with smaller, more cost-effective projects.
“Independent retailers have a very unique value proposition,” he says. “I hope they’re able to adapt without losing that because it’s such a great selling attribute.”
