Knock on wood: A rise in housing starts will revive demand, but competition will threaten growth

Over the past five years, the Lumber and Building Material Stores industry has struggled to rebuild itself, even as the overall economy strengthens. Industry goods are purchased by professional contractors and consumers engaged in remodeling and construction projects. Rising consumer confidence and household income have helped ignite remodeling activity forestalled during the recession, providing additional demand for lumber and other building materials used in home improvement projects. Even so, rising competition from large home improvement stores has stifled revenue growth for lumber and building material stores...read more.

Industry Statistics & Market Size
Revenue
$107bn
Annual Growth 12-17
4.4%
Forecast Growth 17-22
Profit
Employment
301,881
Businesses
45,069
Market Share of Companies
What Our Customers Say

Industry Threats & Opportunities

  • Rising consumer confidence and household income have helped ignite remodeling activity, benefiting the industry
  • Industry operators have started adopting technology for their everyday business practices
  • The industry will continue to compete with home improvement stores
  • Industry Report - Industry Investment Chapter

    The Lumber and Building Material Stores industry has a low level of capital intensity. On average, stores will spend an estimated $0.07 on capital for every dollar spent on wages in 2017. The size and number of stores operated influences the level of capital expenditure undertaken by industry players. Capital costs for this industry include fixtures and fittings, cash registers and Point of Sale (POS) systems. The advent and implementation of computerized scanning technology, while applicable to this industry, has not had a significant impact on the capital costs of operators. Players have been slow in applying this new technology, though some larger operators have made the initial steps for the transition. In ...purchase to read more.

    Additional Insights for the Lumber & Building Material Stores Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Lumber & Building Material Stores Industry are

  • Attractive product presentation
  • Ability to control stock on hand
  • Experienced workforce
  • IBISWorld analysts also discuss how external factors such as Housing starts and Consumer Confidence Index in the Lumber & Building Material Stores industry impact industry performance..

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    What is the Lumber & Building Material Stores Industry?

    This industry consists of stores and dealers (e.g. lumberyards) that retail building materials such as lumber, hardwood, stones and brick. This industry also supplies cabinets, floor coverings, roofing materials, electrical and plumbing goods, doors and windows to the construction market. The industry does not include home improvement centers, paint and wallpaper specialty stores or hardware stores.

    Industry Products
  • Lumber and other structural building materials
  • Hardware, tools, plumbing and electrical supplies
  • Doors and windows
  • Industry Activities
  • Retailing building materials
  • Retailing cabinets
  • Retailing ceiling fans
  • Retailing doors and windows
  • Retailing electrical supplies
  • Retailing fencing
  • Retailing floor coverings (wood or ceramic only)
  • Retailing lighting fixtures
  • Retailing masonry (e.g. block, brick and stone)
  • Retailing plumbing supplies
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Housing starts
  • Consumer Confidence Index
  • Private spending on home improvements
  • Value of residential construction
  • Price of sawmill lumber

  • Current Performance
  • Rebuilding demand
  • Remodeling the industry
  • Restructuring the industry
  • Chart: Revenue Growth

  • Industry Outlook
  • Mounting competition
  • Going green
  • Table: Lumber & Building Material Stores Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Lumber & Building Material Stores Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Electricians
  • Masonry
  • Carpenters
  • Flooring Installers
  • Roofing Contractors
  • Fence & Swimming Pool Construction
  • Consumers

  • Key Selling Industries
  • Electrical Equipment Wholesaling
  • Lumber Wholesaling
  • Manufactured Home Wholesaling
  • Plumbing & Heating Supplies Wholesaling
  • Roofing, Siding & Insulation Wholesaling
  • Stone, Concrete & Clay Wholesaling

  • Products & Services
  • Lumber and other structural building materials
  • Hardware, tools, plumbing and electrical supplies
  • Doors and windows
  • Other
  • Chart: Lumber & Building Material Stores Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Professional contractors
  • Household Consumers
  • Other
  • Chart: Major Market Segmentation for the Lumber & Building Material Stores Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
    ProfitPurchasesWagesRent and other costs
  • Chart: Cost Structure Benchmarking – Sector vs Lumber & Building Material Stores

  • Basis of Competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Lumber & Building Material Stores Industry

  • Industry Globalization
    Builders FirstSource
  • Table: Builders FirstSource - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Lumber & Building Material Stores Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Lumber & Building Material Stores Industry
    Includes:
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Housing Starts (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Table: Industry Financial Ratios
    Do-It-For-Me (Difm)
  • A category of customers who purchase materials themselves and hire third parties or professionals to complete the projects.
  • Do-It-Yourself (Diy)
  • A category of customers that includes homeowners who purchase products and complete their own projects.
  • Professional Contractors
  • Professional remodelers, general contractors, repairmen and tradesmen.
  • Why buy this report?

    IBISWorld’s industry research report on Lumber & Building Material Stores can be used to help you understand the industry’s market size, growth potential and major companies. Five-year forecasts provide insight into the industry’s prospects, so you can make decisions with confidence. This information is perfectly suited to informing your business plans, pitch books, benchmarking and SWOT analysis.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Lumber & Building Material Stores:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Lumber & Building Material Stores market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Lumber & Building Material Stores, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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