The Midwest's home furnishing icon, Masco, tries recession-proofing itself
Cabinets don't get enough appreciation... Holding up Nana's china like a never-ending bench-press is hard. But that's Michigan-based Masco Corp's bread-and-butter — producing home furnishings under brands like Hansgrohe, Delta, and Behr. Now Masco's selling its window division for $725M. And that's critical to its grand recession-proofing plan.
Homes get built, repaired, and remodelled... Masco wants to focus on those last 2 and sell the first. Here's what's in and what's out of Masco's feng shui makeover:
- What it's selling: The parts of homes that only happen during new-house construction, like windows, doors, and kitchen cabinets.
- What it's focusing on: The parts of homes that get repaired and remodelled over the years on existing houses, like paint, lighting fixtures, paint, showers, sinks, and more paint.
"But Masco's cyclical, and a recession could be coming"... Execs at Masco hate hearing that, but it's kind of true. Masco is 'cyclical': business is good when the economy is good, bad when it's bad. During the '05-'11 housing downturn, fewer homes were built so Masco's profits dropped. Masco's sprucing up its business model in order to recession-proof itself — and shut up Wall Street critics.