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 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 13,400 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 million annually.

    • The interior design services industry consists of about 13,400 companies that employ about 45,000 workers and generate $13.6 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

                                    Coronavirus Update

                                    Apr 7, 2022 - Return to Offices Slows
                                    • Workplace occupancy, an indicator of demand for interior design services, has been slow to rebound, even as pandemic conditions have eased. During the first week of December 2021, about 40% of workers had returned to offices in the ten cities monitored by security firm Kastle Systems. By March 30, 2022, the percentage of workers in the office was 42%. Hybrid working models are expected to be the new norm, with long-lasting impacts on office occupancy. “It’s hard to imagine, when you look at office workers who can do their jobs remotely, that those numbers are going to get above 60% to 65% nationwide,” said Brian Kropp, chief of human-resources research for advisory and research firm Gartner.
                                    • Retail openings, a driver of demand for interior design services, are expected to outnumber planned retail closures in 2022, according to Coresight Research. About 1,910 openings are expected, compared with 742 planned closures over the year. That would continue a trend from 2021, when major retailers announced 5,083 store openings compared to 5,079 store closures, and it is an improvement over 2019, when a record 9,300 stores closed.
                                    • As of April 3, the Small Business Administration had forgiven more than 85% of the $789 billion in PPP loans issued since the program was launched in 2020. About 86% of all PPP loan recipients have submitted forgiveness applications.
                                    • The coronavirus pandemic has bolstered corporate interest in redesigning workspaces to simulate nature, have better air filtration systems, and use more sustainable materials, according to Business Insider. Companies are embracing biophilic design — the concept of bringing the health benefits of the outdoors inside. Biophilic concepts include incorporating green walls with plants that help clean the air; using natural materials like wood; creating indoor water features like ponds and waterfalls; and installing circadian lights that provide different color temperatures to keep the body's internal clock in line, such as lighter white lighting to mimic daylight.
                                    • New single-family home sales decreased 6.2% month over month and declined 7.1% year over year in February 2022, according to the US Department of Commerce. According to the National Association of Realtors (NAR), sales of previously-owned homes fell 7.2% month over month and 2.4% year over year in February 2022. The median existing-home price for all housing types increased 15% year over year to $357,300. "Housing affordability continues to be a major challenge, as buyers are getting a double whammy: rising mortgage rates and sustained price increases," said Lawrence Yun, NAR's chief economist. "Some who had previously qualified at a 3% mortgage rate are no longer able to buy at the 4% rate.”
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