New construction profitability depends largely on whether you're dealing with a new homeowner, a contractor with a spec home or a larger multi-unit project.  These days, contractors are cutting every penny out of a project they can.  I can't tell you how many new construction sites I've cold called over the years and the only thing that the contractor wants to know is how 'cheap' can I do it for.  My experience with new construction is that there is either a sizeable allowance for closets, or absolutely nothing - simply sprayed mdf.  You just can't compete with that product (unless you want to eat a lot of mdf dust).  If you've developed a relationship with a quality builder and they do high end work, then you can work the numbers and make money.  Individual homeowners/builders involved with the design decisions offer the best opportunity to make money although they have a budget also.  Larger multi-unit projects are only for companies with deep pockets and are in no hurry to get paid.  And the most important thing to remember with new construction, by the time any project's timeline is ready for designing closets, most all are significantly behind schedule and over budget - there's just nothing left in the checking account for luxury fluff like closets.  It's just a reality.  Additionally, most builders truly don't give a crap about closets.  It's just one additional sub that they prefer not to deal with.  They figure that closet designs are enough of a personal preference that they simply choose to install the cheapest stuff they can get away with and let the new homeowners worry about it down the road.  Which now leads me to retrofitting exisitng residential - it is still the surest way to develop a personal relationship with the customer and use your sales & design skills to develop awareness and upsell your product and bottom line.... of coarse that's my opinion.  One last point... be weary of builders who want to see a design... the majority are simply looking for ideas to pass onto their finish carpenters who are putting on their dust masks to protect them from the mdf dust up that's coming.