Hardware, Plumbing & HVAC Distributors
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 9,750 hardware, plumbing, and HVAC/R distributors in the US consolidate a variety of products from many different manufacturers to offer customers wide selection, reasonable prices, and a single point of contact. Distributors may sell a combination of product categories or specialize.
Construction Drives Demand
Hardware, plumbing, and HVAC distributors depend on construction projects as major sources of revenue.
Consolidation Continues
Distributors continue to expand into new industries and geographical markets or gain market share via acquisitions.
Industry size & Structure
A typical hardware, plumbing, HVAC and refrigeration distributor operates out of a single location, employs about 31 workers, and generates $16.3 million annually.
- The hardware, plumbing, and HVAC/R distributor industry consists of 9,750 companies, employs 302,000 workers, and generates about $159 billion annually.
- Most distributors are small, independent operations - 52% operate out of a single location and 79% have fewer than 20 workers.
- Customers include building contractors, residential and commercial builders, dealers, hardware retailers, government accounts, and industrial and institutional customers.
- Large companies include Ace Hardware, Ferguson, MRC Global, Hajoca (EMCO), Watsco, NOW Inc. (DistributionNOW), and HD Supply.
Industry Forecast
Hardware, Plumbing & HVAC Distributors Industry Growth
Recent Developments
Mar 25, 2024 - Wage Growth Outstrips Pricing
- Producer prices charged by hardware, plumbing, and HVAC distributors were up slightly in Q4, year-over-year, but wage growth slightly outpaced price increases over the same period, according to the Bureau of Labor Statistics (BLS). If hardware, plumbing, and HVAC distributors’ prices can’t keep pace with higher labor costs, margins may suffer. Industry employment increased slightly in Q4 compared to a year earlier, according to the BLS.
- US multifamily construction starts are expected to slow further in 2024 after mounting weakness in 2023, according to the National Association of Home Builders (NAHB). In 2023, multifamily starts fell 14% to 472,000 units. Multifamily starts are forecast to drop 20% in 2024 to 379,000. About 1 million multifamily units are currently under construction, the most since 1973. High levels of fresh inventory coming online will hinder new apartment building activity. A tight lending environment and high borrowing costs also challenge multifamily projects. The NAHB expects the residential remodeling market to remain flat in 2024 compared to 2023, then grow by about 2% in 2025. Remodeling is supported by a lack of existing homes on the market, high homeowner equity, and the aging of US housing stock.
- Apartment buildings are getting taller amid sustained demand for rentals, scarcity of land, and some cities’ willingness to change zoning rules to attract development, according to The Wall Street Journal. Between 2021 and 2023, US cities added more than 2,900 buildings with more than 200 units, a 17% increase of the number built between 2018 and 2020, according to property data firm Yardi. High interest rates and single-family home prices continue to prop up demand for rentals, even among those with relatively high incomes. Some cities are easing some zoning rules, such as minimums for parking. The economics of multifamily development have also changed. Higher construction costs mean buildings need to have more units to be profitable.
- According to the recently released 2024 version of the What Home Buyers Really Want study by the National Association of Home Builders (NAHB), US home buyers are looking for smaller homes. The study found that in 2023, the typical buyer wanted a home with 2,067 square feet of finished area, down from 2,260 in 2003. The NAHB study is supported by data from the US Census Bureau on housing starts. In 2023, the average size of new homes started in the US fell to 2,411 square feet, the lowest in 13 years. The size of homes started has been trending lower since peaking at 2,689 square feet in 2015.
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.