Site Prep 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 38,400 site preparation contractors in the US prepare land for construction activity. Services include excavation work; wrecking and demolition; trenching; sewer and water main installation; construction machinery rental (with operator); and road construction. While private sector projects account for the majority of revenue, site prep contractors also provide services to federal, state, and local governments.
Dependence On General Contractors
Because site preparation is just part of the construction process, companies often depend on general contractors to secure client business.
Seasonal And Weather-Related Factors
Seasonality and weather conditions affect project timelines and site prep contractors’ ability to perform work.
Industry size & Structure
The average site preparation contractor operates out of a single location, employs 9-10 workers, and generates about $2-3 million annually.
- The site preparation services industry consists of about 38,400 companies that employ 396,000 workers and generate about $97 billion annually.
- The industry is fragmented; most site preparation contractors serve a limited geographical market.
- Some large general contractors, such as Granite Construction and Sterling Construction, offer site preparation services in addition to other construction services.
Industry Forecast
Site Prep Contractors Industry Growth
Recent Developments
Dec 13, 2024 - Housing Market May Not Rebound in 2025
- The 2024 housing market is on track to be the slowest in nearly 30 years as high mortgage rates and home prices combined with extremely low housing inventories have kept homeowners locked in place and would-be homebuyers priced out of the market, according to The New York Times. The National Association of Realtors estimates that four million homes will be sold in 2024, marking the second straight year of historically weak activity and the slowest home sales since 1995. Market observers note that the housing crisis is a product of weak supply. Builders have struggled amid lingering pandemic-era problems, including high borrowing, labor, and materials costs. Freddie Mac estimates the housing shortage equals about 3.7 million homes. The outlook for 2025 remains uncertain as home prices and mortgage rates are expected to remain stubbornly high.
- The missing-middle segment of the US multifamily housing construction market saw its biggest gain in 17 years in the third quarter of 2024, according to The National Association of Home Builders (NAHB). The missing middle, which consists of housing properties with 2-4 units, has been weak since the Great Recession. However, in the third quarter, there were 6,000 construction starts for projects with 2-4 units, more than double the amount in Q3 2023. The missing middle’s share of overall multifamily construction was just over 6% in Q3 2024, down considerably from about 11% that was typical between 2000 and 2010. While the NAHB notes that missing middle developments are likely to continue lagging absent zoning reforms, the recent increase is encouraging.
- Some building contractors are concerned that the Trump administration's promises of tariffs and a tougher stance on immigration could increase their costs and make their labor difficulties worse, according to The Wall Street Journal. Some industry observers suggest Trump’s plan to deport undocumented workers could cause labor shortages. In California, New Jersey, Texas, and Washington, DC, immigrants make up more than half of the construction workforce, according to the Harvard Joint Center for Housing Studies. Nationwide, undocumented workers make up about 13% of the construction sector’s workforce, according to the Pew Research Center. President-elect Trump’s proposed 25% tariffs on goods from Canada and Mexico could drive up construction costs for key inputs, including softwood lumber, cement, gypsum (used to make drywall), and iron and steel. However, some builders are optimistic that Trump’s deregulation plans could reduce construction costs.
- In the third quarter of 2024, there were about 24,000 single-family built-for-rent (SFBFR) housing starts in the US, up 41% from the same period in 2023, according to National Association of Home Builders analysis of US Census Bureau data. During the four most recent quarters, 92,000 SFBFR homes began construction, which is up 31% compared to how many were built in the previous four-quarter period. While the historical four-quarter moving average market share for SFBFR is about 2.7% (1992-2012), SFBFR’s current four-quarter moving average market share is about 7.5%. Single-family built-for-rent homes provide an alternative for consumers who want more space but are challenged by a lack of affordable housing inventory, high interest rates, and downpayment requirements in the for-sale market.
Get A Demo
Vertical IQ’s Industry Intelligence Platform
See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.
Build valuable, lasting relationships by having smarter conversations -
check out Vertical IQ today.