Painting & Wall Covering Contractors
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 36,500 painting and wall covering contractors in the US apply paint, stain, coatings, and wall coverings to walls, buildings, bridges, and other structures. Companies may specialize in a particular type of application, such as residential, industrial, or decorative painting. Other services include pressure washing, deck finishing, wood staining, drywall finishing, and exterior waterproofing/sealing.
Risk Of Injury And Illness
Workers are constantly working at heights that require ladders, scaffolding, lifts, or harnesses.
Dependence On The Construction Industry And Economy
Demand for painting and wall covering services is closely tied to the health of the construction industry, which is influenced by the state of the economy.
Industry size & Structure
The average paint and wall covering contractor operates out of a single location, employs 5-6 workers, and generates about $695,000 annually.
- The paint and wall covering contractor industry consists of about 36,500 establishments that employ about 197,200 workers and generate about $25 billion annually.
- The industry is highly fragmented; the majority of firms are small, independent operators. Many painting and wall covering contractors are self-employed.
- Large companies, such as the Brock Group, offer industrial painting as part of a larger portfolio of services.
Industry Forecast
Painting & Wall Covering Contractors Industry Growth
Recent Developments
Mar 16, 2023 - Home Builder Sentiment Improves
- Tight existing home inventories are pushing buyers into the new home market, which helped move home builder confidence higher in March, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), rose two points to 44 in March 2022 2022, although the HMI remained in bearish territory. Any HMI reading over 50 indicates more builders see conditions as good than poor. While stress in the US financial system pushed mortgage interest rates down, affordability is still a significant roadblock to homeownership for many. The NAHB said a side effect of the increased pressure on regional banks will be a further tightening of acquisition, development, and construction (AD&C) loans for home builders. In March’s HMI survey, 40% of builders rated lot availability as poor.
- Mortgage rates dipped slightly after the collapse of Silicon Valley Bank, but housing industry watchers are uncertain if lower rates will persist long enough to provide much relief from the affordability issues that have slowed the US housing market, according to Yahoo Finance. Some financial market watchers note that the banking sector's jitters could slow the Federal Reserve’s strategy of taming inflation with rate hikes. Redfin chief economist Daryl Fairweather told Yahoo Finance, “There's still a lot of uncertainty but in the near term, I do expect mortgage rates to drop. And I expect buyers to take advantage of those mortgage rates because we've seen buyers be incredibly sensitive to those interest rates.” However, some industry insiders suggest that rates would need to drop and stay low for a sustained period to lure more buyers into the market.
- Residential remodelers’ average gross and net profit margins declined in 2021, according to the 2023 edition of the Remodelers’ Cost of Doing Business Study released in March by the National Association of Home Builders (NAHB). Remodelers’ average gross profit margin grew steadily from 26.8% in 2011 to 30.1% in 2018, but in 2021 fell to 24.9%. The drop in gross margins was primarily due to higher trade contractor and homebuilding costs. However, remodelers’ average net margins were more resilient, dropping to 4.7% in 2021 from 5.2% in 2018. Steadily falling operating expenses between 2018 and 2021 held back a steeper decline in average net margins. The study also showed that residential remodeler participation in the single-family homebuilding market is rising. In 2018, 6% of total remodeler revenue came from single-family construction; in 2021, the share rose to 11%.
- The Dodge Momentum Index (DMI) increased 1.9% in February 2023 to 203.0 (2000=100), up from the revised January reading of 199.3. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which has been shown to lead construction spending for nonresidential buildings by a full year. On a monthly basis, the commercial planning component rose by 1.4%, and institutional increased by 2.9%. Commercial planning got a boost from an almost 20% rise in office planning and stronger data center project planning. In the institutional sector, education and healthcare planning saw gains, with research laboratories being a noted bright spot. Dodge’s associate director of forecasting said, “The continued elevation in the DMI should provide hope that construction activity will grow in 2024. Owners and developers tend to put projects into planning until well after economic conditions weaken. During the Great Recession, for example, the DMI did not substantially decline until 2009. Therefore, the anticipated mild economic growth in 2023 could cause the DMI to moderate over the year, but it is unlikely to fall below historical norms.”
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