Flooring Contractors
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 17,400 flooring contractors in the US install resilient floor tile, carpeting, linoleum, and hardwood flooring. Single-family homes and office buildings account for the majority of sales. Other sources of revenue include apartment buildings; health care and institutional buildings; retail establishments; and educational buildings.
Dependence on General Contractors
Flooring contractors often work with general contractors (GC), which act as a gateway to construction jobs, especially large projects.
Vulnerability to Trends in the Construction Market
The flooring industry and demand for installation services are vulnerable to trends in the construction market, which is cyclical and influenced by economic factors.
Industry size & Structure
The average flooring contractor operates out of a single location, employs about 5 workers, and generates $1 million annually.
- The flooring contracting industry consists of about 17,400 establishments that employ about 80,400 workers and generate $18 billion annually.
- Most firms are small, independent businesses that served a limited geographical area. The largest firms, such as Redi Carpet, Bonitz Flooring Group, and Spectra Contract Flooring, operate regionally.
- Large flooring retailers include LL Flooring, Empire Today, and Floor & Décor. Retailers typically refer customers to third-party flooring installers.
Industry Forecast
Flooring Contractors Industry Growth
Recent Developments
Jun 12, 2024 - Industry Growth Poised for Rebound
- The flooring contracting industry is expected to see almost flat sales growth this year, but demand is projected to improve in the following four years. The industry’s year-over-year sales increased by 10.6% in 2022 before dropping to 3.2% in 2023, according to Inforum and the Interindustry Economic Research Fund, Inc. Sales growth is projected to fall to 1.1% in 2024, then rise by 6.9% in 2025. The industry will then see steady average annual growth of about 6.8% through 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
- High interest rates have slowed the US housing market, a key demand driver for flooring contracting. In May 2024, the average 30-year fixed-rate mortgage rose seven basis points to 7.06% compared to 6.99% in April, according to Freddie Mac. May’s rate was up 64 basis points from May 2023, when the average 30-year fixed-rate mortgage was 6.34%. The National Association of Home Builders (NAHB) expects 30-year mortgage rates to linger in the 6.66% range through the end of the year and dip slightly below 6% by the end of 2025. The NAHB projects that the Federal Reserve will announce a rate cut at its meeting in December, and there will be another six cuts in 2025.
- A lack of affordability in the US housing market is prompting a building boom of for-rent homes, according to The Wall Street Journal. Amid high interest rates and home prices, many affluent potential home buyers are priced out of the single-family and townhome markets. In 2023, US builders completed 93,000 for-rent homes - the most ever in a single year and up 39% over 2022, according to John Burns Research and Consulting. There are another 99,000 for-rent homes currently under construction, but the breakneck pace of development is expected to slow as lending standards tighten. However, some industry watchers believe any lull in built-for-rent home demand will be brief as economic conditions make renting a better financial option than buying. As of March 2024, the average monthly mortgage payment was 38% higher than the average monthly apartment rent, according to CBRE.
- The total value of nonresidential building construction starts increased 17% in April from March, according to Dodge Construction Network. The April gain was led by a doubling of manufacturing projects over March levels. April’s institutional starts rose 16% amid an increase in healthcare and transportation starts. Commercial construction starts dropped by 1% due to weakness in the parking and warehouse markets. Year-to-date, nonresidential building starts were up 5% compared to the first four months of 2023. Residential starts fell 1% in April compared to the previous month as a 13% rise in multifamily starts wasn’t enough to offset single family’s 7% decline. Dodge Construction Network chief economist Richard Branch said, “The rebound in starts in April was certainly good news for the sector. While the uncertain timing of Fed interest rate cuts is causing concern, developers and owners are feeling reasonably confident that end-market demand will sustain project starts in some sectors. While risk remains in the sector for interest rates, labor, and material prices the value of projects in planning has been reasonably stable indicating future confidence.”
Get A Demo
Vertical IQ’s Industry Intelligence Platform
See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.
Build valuable, lasting relationships by having smarter conversations -
check out Vertical IQ today.