Prefabricated Wood Building Manufacturers

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 600 prefabricated wood building manufacturers in the US produce modular homes and commercial building units, log cabins, detached garages, sheds, sauna rooms, gazebos, wooden geodesic domes, and farm buildings such as barns, chicken coops and corn cribs. This industry does not include mobile home manufacturers, although some modular building manufactures also offer mobile homes and park models.

Variable Building Material Prices

Prefabricated wood building manufacturers rely on supplies of lumber, particle board, drywall, electrical wiring, plumbing fixtures, windows and doors, roofing and siding materials, insulation, flooring materials, cabinets, paint, and hardware.

Demand for Affordable Housing

Firms stand to benefit by working with land developers, lenders, and the government in creating affordable housing projects.

Industry size & Structure

A typical prefabricated wood building manufacturing firm operates out of a single location, employs about 37 workers, and generates about $11 million annually.

    • The prefabricated wood building manufacturing industry consists of about 600 companies which employ about 22,000 workers and generate about $6.5 billion annually.
    • Just 50 firms have 100 or more workers.
    • The industry is somewhat concentrated: the 20 largest firms represent just 3.5% of the total number of firms but they control 59% of industry revenue.
    • Large companies include Skyline Champion (modular homes), Southland Log Homes, Backyard Products (sheds, gazebos), Country Carpenters (barns and sheds), and JDM Structures (barns and sheds).
                                  Industry Forecast
                                  Prefabricated Wood Building Manufacturers Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  May 13, 2024 - Steady but Flat Industry Growth
                                  • The prefabricated wood building manufacturing industry is expected to return to stronger sales growth in 2025 after sluggish performance in 2023 and 2024. The industry’s year-over-year sales growth slowed to 1.3% growth in 2023 after a rise of 10.2% in 2022, according to Inforum and the Interindustry Economic Research Fund, Inc. Sales growth in the prefabricated wood building manufacturing industry is expected to improve slightly in 2024 with a gain of 2.7, then see average annual growth of about 4.6% through 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
                                  • The NAHB/Westlake Royal Remodeling Market Index (RMI) reading for the first quarter of 2024 was 66, down one point from the fourth quarter of 2023, according to an April 2024 report by the National Association of Home Builders (NAHB). Any RMI reading over 50 indicates that most remodelers feel market conditions are good. In the first quarter, the Current Conditions Index portion of the RMI remained unchanged in Q4 2023 at 74. The Future Indicators Index component of the RMI was also unchanged at 59. While the RMI remained solidly in positive territory in Q1 2024, the NAHB noted that high prices for labor and materials continue to pose challenges to the remodeling industry. The NAHB said that although the Current Conditions Index and the Future Indicators Index were unchanged in Q1, the overall RMI dropped a point due to rounding. Remodeling spending can help drive demand for sheds and other prefabricated wood buildings.
                                  • The US commodity producer price for lumber increased by 2.1% in March 2024, according to the US Bureau of Labor Statistics. However, March’s lumber prices were down 3.4% compared to a year earlier. Higher lumber prices that can’t be passed on to prefabricated wood building customers can hurt company margins.
                                  • To cope with housing shortages and a lack of affordability, many municipalities are changing their zoning rules to encourage more housing development, according to NPR. Cities find their zoning rules rigid and outdated, making building new housing stock difficult and expensive. Some cities are changing their rules to allow more multifamily developments, including townhomes and apartments, and permitting accessory dwelling units (ADUs), which add a secondary structure on one lot. Some cities have also reduced lot-size requirements, encouraging greater density and the number of available housing units. Allowing more ADUs could increase demand for prefabricated wood dwellings.
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