Paint and Varnish Wholesalers
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 940 paint, varnish, and supply wholesalers in the US act as middlemen between manufacturers and a variety of end users, including retailers, other wholesalers, collision repair centers, OEMs, and building contractors. Special purpose coatings, which include automotive paints, account for over 40% of industry sales. Architectural coatings account for one third of industry sales. Other products include architectural coatings, enamels, primers, stains, solvents, and lacquers; paint supplies (brushes and rollers); OEM coatings; and wallpaper and wallpaper supplies.
Dependence on Automotive Collision Repair Business
Because automotive paint and coating sales account for a significant percentage of the market, the industry is influenced by demand from the vehicle collision repair market, which consists primarily of small independent businesses.
Dependence on Construction Industry and Economy
Demand for architectural paint and coatings is dependent on the health of the construction industry, which is cyclical and influenced by economic conditions.
Industry size & Structure
The average paint, varnish, and supply wholesaler employs 20-22 workers and generates $7-8 million annually.
- The paint, varnish, and supply wholesale industry consists of about 940 firms that employ 20,000 workers and generate $7 billion annually.
- The industry is concentrated; the top 50 companies account for about 84% of industry revenue.
- Large automotive paint, body, and equipment (PBE) wholesalers include LKQ Corporation and ThePaintStore.com. Large manufacturers of paints and coatings include PPG, Sherwin-Williams, and RPM. Sherwin-Williams is one of the largest wallpaper distributors in the US.
Industry Forecast
Paint and Varnish Wholesalers Industry Growth
Recent Developments
Nov 25, 2024 - Remodeling Spending Expected to Rebound by Mid-2025
- Home remodeling spending is expected to resume stronger growth by the middle of 2025, according to the Leading Indicator of Remodeling Activity (LIRA) report released in October by the Joint Center for Housing Studies at Harvard. Homeowner improvements and repairs are expected to decrease 2.1% to $469 billion in the fourth quarter of 2024 compared to Q4 2023. In the first quarter of 2025, remodeling spending will drop 2.1% from Q1 2024 to $454 billion. Spending will then rise to $473 billion in Q2 2025, up 0.6% from Q2 2024. In the third quarter of 2025, year-over-year spending is forecast to increase by 1.2% to $477 billion. The Joint Center expects improvements to be supported by improving existing home sales and higher home values, which will boost spending for necessary replacement and discretionary remodeling projects.
- High sticker prices and borrowing costs are keeping some potential car buyers away from dealers, according to The Wall Street Journal. US light vehicle sales were down 1.9% in the third quarter of 2024 compared to the same period in 2023, according to Ward’s Intelligence. While auto sales have been sluggish, they are expected to see a slight gain over 2023’s 15.7 million units. However, 2023 sales were hurt by lingering supply-chain disruptions. For the five years before the pandemic, US auto dealers sold about 17 million units per year. Affordability is a significant issue, experts say. In September 2024, the average new car price was $44,467, according to JD Power. While that is down about 3% compared to the same period in 2023, the average price of a new car in 2019 was $34,600. New light vehicle sales are a demand driver for automotive paints.
- Home builder confidence in the single-family market increased in November, marking the third consecutive month of sentiment improvement, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), rose three points to 46 in November 2024. Any HMI reading over 50 indicates that more builders see conditions as good than poor. The NAHB said builders are generally upbeat about the election outcome, and future sales expectations improved in November. The HMI survey also showed that 31% of builders reduced home prices in November, and the average price reduction fell slightly to 5% from 6% in October.
- Home improvement industry observers expect remodeling spending to rise in 2025 as more homeowners borrow against the rising equity they have in their homes, according to The Wall Street Journal. After a significant uptick during the pandemic, as people were stuck at home, remodeling spending has been lackluster. Higher interest rates also made it more expensive to finance major renovations. In September 2024, the Federal Reserve cut interest rates for the first time in four years. Rates are expected to continue dropping, which could prompt many homeowners to leverage the value locked in their homes and take out loans for improvements.
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