Cut Stone & Stone Product Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 1,900 stone products manufacturers in the US cut, shape and finish granite, marble, limestone, slate, and other types of stone for building projects and other uses. Firms may also work with composites, such as engineered stone or solid surface products. Applications for cut stone products include countertops, floors, and walls. Stone fabricators may have in-house staff dedicated to installation, rely on subcontractors, or use a combination.
Competition from Alternative Materials
Natural and manufactured stone compete with a variety of alternative materials, depending on the application.
Dependence on Imports
Stone fabricators are highly dependent on foreign suppliers for dimensional stone.
Industry size & Structure
The average stone products manufacturer operates out of a single location, employs 16 workers, and generates about $2-3 million in annual revenue.
- According to the Census, the cut stone and stone product manufacturing industry consists of about 1,900 companies that employ about 32,000 workers and generate $5 billion annually.
- Industry groups estimate the number of stone fabricators in the US could be as high as 8,000 to 12,000. A survey by the Natural Stone Institute found that automated shops employ an average of 38 workers, while manual shops, which tend to be smaller operators, employ an average of 10 workers. Average sales volume was between $2 million and $3 million.
- The industry is fragmented; the top 50 companies account for 35% of industry revenue.
- Large, vertically-integrated firms, such as Cold Spring Granite, extract, cut, and finish stone products. Most firms are small and serve a local market.
Industry Forecast
Cut Stone & Stone Product Manufacturers Industry Growth
Coronavirus Update
Nov 20, 2021 - Port Agreement Yields Few Quick Improvements
- An October agreement through which the Port of Los Angeles will operate 24 hours, seven days a week, has been of limited benefit as of late November. Gene Seroka, the Port of Los Angeles executive director, said that the Los Angeles–Long Beach port complex has “24/7 capability”, but a shortage of truck drivers and nighttime warehouse workers, along with difficulty getting importers to embrace expanded hours, poses problems in establishing a nonstop schedule. Eighty-four container ships were waiting to enter the Los Angeles–Long Beach port complex on November 16, slightly down from some prior days when the number topped 100. Stone fabricators are highly dependent on foreign suppliers for dimensional stone. Imports account for 82% of the US market, according to the US Geological Survey.
- The number of US hotel rooms under construction is down 20.3% from the country’s all-time high in April 2020, according to September 2021 pipeline data from hotel industry research firm STR. The final two phases of the pipeline, construction and final planning, are down by double digits from the same time last year while activity in the planning stage has risen significantly.
- Supply chain experts say that it will take at least six months to alleviate intermodal congestion that stretches from Asian ports, across the Pacific to US ports, and on to railroads and their inland terminals. Railroads have experienced congestion for months at inland intermodal terminals, particularly in the Chicago area. Shippers have been slow to pick up their containers, and are keeping them longer for unloading at warehouses and distribution centers, which has created a shortage of chassis and bottlenecks. Railroads say their intermodal networks have capacity to handle current volumes, but only if all links in the supply chain are working relatively smoothly. Imports account for 82% of the US market for dimensional stone, according to the US Geological Survey.
- Annual growth in home renovation and repair expenditures will reach 8.6% by Q2 2022, according to the Leading Indicator of Remodeling Activity (LIRA) released by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. “Home remodeling will likely grow at a faster pace given the ongoing strength of home sales, house price appreciation, and new residential construction activity,” says Chris Herbert, Managing Director of the Joint Center for Housing Studies. “Larger gains in retail sales of building materials suggest the remodeling market continues to be lifted by DIY activity as well,” says Abbe Will, Associate Project Director in the Remodeling Futures Program at the Center. “By the middle of next year, annual remodeling expenditures to owner-occupied homes are expected to surpass $380 billion.”
- Total construction starts will increase 4% in 2021, according to Dodge Data & Analytics. "The dollar value of starts for residential buildings will increase 5% in 2021, nonresidential buildings will gain 3%, and nonbuilding construction will improve 7%. Only the residential sector, however, will exceed its 2019 level of starts thanks to historically low mortgage rates that boost single family housing,” said Richard Branch, Chief Economist for Dodge Data & Analytics.
- Spending on nonresidential building projects is declining and will do so through 2021, according to a mid-year update to the American Institute of Architects’ (AIA) Consensus Construction Forecast. The AIA estimates an 8% spending drop in 2020 and just under 5% in 2021 due to pandemic-induced economic disruptions. This is the first time in nearly a decade that nonresidential construction spending has trended downwards, according to the AIA.
- Total construction spending decreased 0.5% in value month over month on an adjusted basis but increased 7.9% in value year over year on an unadjusted basis in September, according to the US Census Bureau. Residential construction spending decreased 0.4% month over month but increased 19.2% year over year in September. Nonresidential construction spending decreased 0.6% month over month and 1.2% year over year in September.
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