Interior Design Services

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 15,200 interior design firms in the US plan, design, and administer projects in interior spaces to meet the physical and aesthetic needs of customers. Revenue comes primarily from design services and product sales. Companies may specialize in a particular sector (hospitality, health care, institutional, residential), room (kitchens, bathrooms, closets), or style (contemporary, traditional).

Demand Driven By Construction Trends

Interior design services are often tied to new construction and remodeling projects.

Design Driven By Trends And Fads

The interior design market is often driven by styles and trends in the fashion world.

Industry size & Structure

The average interior design service provider operates out of a single location, employs 3-4 workers, and generates about $1.3 million annually.

    • The interior design services industry consists of about 15,200 companies that employ about 55,000 workers and generate $19.3 billion annually.
    • The industry is highly fragmented; the top 50 firms account for 15% of industry sales.
    • Large companies that offer interior design as part of a portfolio of services include Gensler, HOK, and Perkins+Will. The majority of firms are small, independent companies with localized operations.
                                    Industry Forecast
                                    Interior Design Services Industry Growth
                                    Source: Vertical IQ and Inforum

                                    Recent Developments

                                    Jun 28, 2024 - AI Apps Aid in Remodeling Design, Project Planning
                                    • More designers, remodelers, and homeowners are using AI-enabled apps to make their decisions about home designs and remodeling, according to The Wall Street Journal. The developers of AI home design apps suggest the tools can save time and money by quickly visualizing dozens of designs and layout ideas, estimating costs, and coordinating interactions between the designer, contractors, and homeowner. Some apps are more focused on remodeling, enabling homeowners to sample different designs after uploading photos or drawings of their rooms. Other apps cater more to the design-build community by generating floor plans and managing project logistics.
                                    • In June, Lowe’s began a pilot program at three store locations that lets customers use Apple’s Vision Pro virtual reality headsets to visualize and customize preset kitchen styles, according to Retail Dive. The pilot allows customers to use the Vision Pro headsets to interface with the Lowe’s Style Studio app to select designs, materials, and appliances with help from store associates. The Lowe’s Style Studio app can create a PDF file of final designs that customers can share with their contractors. Products selected during the design process can be bought in-store or on Lowe’s app.
                                    • Sales of existing US homes decreased by 0.7% in May from April and were also down 2.8% year-over-year, according to the National Association of Realtors (NAR). The median price for all types of homes in May was $419,000, marking an all-time high and up 5.8% from a year earlier. According to Freddie Mac, as of June 20, 2024, the 30-year fixed-rate mortgage averaged 6.87%, down from 6.95% for the same period in 2023. NAR chief economist Lawrence Yun said, "Home prices reaching new highs are creating a wider divide between those owning properties and those who wish to be first-time buyers. The mortgage payment for a typical home today is more than double that of homes purchased before 2020. Still, first-time buyers in the market understand the long-term benefits of owning." Home sales are a strong demand driver for interior design services.
                                    • A recent downturn in Home Depot’s sales could signal that a decade-long surge in home improvement spending is softening, according to The Wall Street Journal. In May, Home Depot reported first-quarter revenue of $37.26 billion, down 4.2% from the same period a year earlier. The home improvement giant also revised its full-year guidance downward to a sales decline between 2% and 5% from a February estimate of flat 2024 growth. Some industry observers suggest homeowners may have completed many of their home projects during the pandemic. Consumers may also be pulling back on their spending amid growing economic uncertainty and high interest rates and inflation. Remodeling activity is a leading demand driver for interior design services.
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