Metal Coating, Engraving & Heat Treating
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 4,830 metal finishing companies in the US provide finishing services for manufacturing and construction customers. Major revenue categories include metal coating and engraving; electroplating, plating, polishing, anodizing, and coloring; and metal heat treating. Companies provide finishing services for customer-supplied metal goods and may sell finished metal goods. Some companies offer finishing services for alternative materials, such as plastics and composites.
Waste and Regulation
The metal finishing industry is highly regulated because processes often involve dangerous chemicals and the generation of hazardous waste.
Captive Finishing
Companies may compete with manufacturers that opt for in-house metal finishing activities instead of outsourcing to a third party (“captive finishing”).
Industry size & Structure
The average metal coating, engraving, and heat treating service provider works out of a single location, employs about 26-27 workers, and generates $6-7 million annually.
- The metal coating, engraving, and heat treating services industry comprises about 4,830 firms that employ about 130,000 workers and generate about $29.5 billion annually.
- Most industry categories are concentrated, with the top 50 companies accounting for about 59-66% of industry revenue. The electroplating, plating, polishing, anodizing, and coloring sector is less concentrated, with the top 50 companies accounting for 34% of sector revenue.
- Companies specializing in metal coating and engraving account for about 47% of firms and 54% of industry revenue. Companies specializing in electroplating, plating, polishing, anodizing, and coloring account for about 41% of firms and 27% of industry revenue. Companies specializing in metal heat treating account for 12% of firms and 19% of industry revenue.
- Large companies include Material Sciences Corporation, Metal Improvement Company (Curtiss-Wright Surface Technologies), and Bodycote. Some large companies are owned by foreign companies or have international operations.
Industry Forecast
Metal Coating, Engraving & Heat Treating Industry Growth
Recent Developments
Dec 21, 2024 - Prices Rising Amid Falling Sales
- Producer prices for metal coating, engraving, and heat treating firms increased by 3.8% in November compared to a year ago after rising 6.7% in the previous November-versus-November annual comparison, according to the latest US Bureau of Labor Statistics data. Employment by the industry dipped 0.8% year over year in October, while average wages at metal coating, engraving, and heat treating firms jumped 10.6% over the same period to $24.10 per hour, down slightly from their peak in July, BLS data show. Producer prices have continued to climb amid falling sales for fabricated metal products companies, which were down 18.7% in the second quarter compared to a year ago, according to the Census Bureau.
- The Gardner Business Index Future Business Index (FBI) – an indicator of the future state of the finishing market as reported by industry respondents – registered 63.5 in November, reflecting strong optimism about 2025 business conditions. (A reading above 50 indicates expansion and under 50 contraction.) The positive outlook for the new year is due to anticipated growth in automotive production and aerospace finishing demand, Products Finishing reports. November’s election results are fueling the recent surge in the FBI and industry optimism, with the incoming Trump administration’s increased focus on manufacturing competitiveness, possibly accelerating investment in finishing technologies. The GBI, which measures the current state of the finishing industry, registered 45.4 in November, showing improvement from October’s reading. New orders and production increased month-over-month in November suggesting improved demand particularly from automotive customers as manufacturers adjust production schedules, per Products Finishing.
- Declining orders and production at US factories and recovery in the labor market is leaving less work for robots, The Wall Street Journal reported in October. According to the Association for Advancing Automation, orders for factory robots in North America plunged by nearly one-third in 2023 from 2022’s record volume and orders continued to slide during the first six months of this year. The pandemic-induced surge in demand for robots – driven by a shortage of factory labor and rising production as the economy reopened – has fallen steeply as manufacturers cut back on purchases of automation equipment, manufacturing executives told WSJ. The slowdown in electric vehicle production due to soft sales has also cooled demand for robots. US industrial production and manufacturing output fell in September, according to the Federal Reserve, while capacity utilization at US factories stood at 77.5%, compared with August's 77.8%.
- According to recently released Census Bureau figures, US capital expenditures for robotic equipment totaled $12,960 million (not statistically different than 2021) and accounted for 1.1% of total equipment expenditures in 2022. The manufacturing sector was the largest investor, accounting for more than half (56.2%) of all robotic equipment expenditures – nearly $7.3 billion that year. Amid a stubborn labor shortage, manufacturers rely increasingly on automation, including robots, for some tasks to achieve greater productivity. Metal finishing firms use robots for various applications, including robotic buffing, deburring, grinding, and polishing.
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