Testing Laboratories
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 5,200 testing labs in the US perform physical, chemical and other analytical testing services to evaluate products, substances, or systems and provide certification for manufacturers and other industries. Labs may also provide independent data to support a product’s claims.
Dependence On Highly Skilled Workers
Testing labs require the skills of highly educated scientists, engineers, and technicians.
High Capital Requirements
The fixed costs associated with establishing a testing lab can be high.
Industry size & Structure
A typical testing lab operates out of a single location, employs 35 workers, and generates $5.3 million in annual revenue.
- The testing lab industry consists of about 5,200 companies that employ 180,000 workers and generate $27.5 billion annually.
- The testing lab industry is concentrated with the top 50 firms accounting for 46% of industry revenue.
- Customer industries include defense, aerospace, telecommunications, automotive, consumer products, agricultural products, and industrial products.
- Large domestic companies include KBR, Pace Analytical Services, and UL Solutions. Some large international labs, such as Bureau Veritas and Eurofins Scientific have US operations.
Industry Forecast
Testing Laboratories Industry Growth
Recent Developments
Nov 12, 2024 - Researchers Develop Blood Test to Detect Heart Attacks
- Johns Hopkins University researchers have developed a fast and accurate nanostructure-based tool for the early detection of heart attacks. The invention has a tiny microchip with a novel nanostructured surface that can detect heart attack biomarkers in blood within minutes. Heart attacks are often difficult to detect quickly because they involve tools such as electrocardiograms and lab work. The device developed by the Johns Hopkins team was developed for clinical settings but could be adapted for use in the field by first responders or eventually in the home.
- The testing laboratory industry is expected to experience slower sales growth in 2024 after a softening of demand in 2023. The industry’s year-over-year sales growth fell to 7.7% in 2023 after posting an increase of 14.3% in 2022, according to Inforum and the Interindustry Economic Research Fund, Inc. Testing lab industry sales growth is projected to further moderate to 3.7% in 2024 and 2025, then see flat but steady average annual growth of about 4.3% through 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
- Developers who were bullish on lab space real estate projects during the pandemic are finding the market is oversaturated, according to The Wall Street Journal. Early in the pandemic, developers moved quickly to build lab space with special climate control, anti-vibration, ventilation, power, and fire safety features. But the market for such spaces has become bloated by a glut of new properties coming online. More than 59 million square feet of new lab space has been built since the first quarter of 2020, and there’s another 19.1 million square feet in development, according to real estate services firm JLL. Compounding the issue is a drop in demand. Many life-sciences, biotech, and pharmaceutical firms have pulled back on investments amid high interest rates, tight lending standards, and economic uncertainty. Lab space properties that cannot find tenants are being marketed as offices in some markets.
- University of British Columbia researchers have developed an inexpensive and portable tool that can test for the presence of microplastics in water, according to Lab Manager. The device, which is paired with a smartphone, uses fluorescent labeling to detect plastic particles ranging from 50 nanometers to 10 microns. The device displays the number of plastic particles in a sample via a smartphone app. Microplastics leach into the environment as plastic products degrade. They are of particular concern to human health as they readily absorb toxins and can cross biological barriers in the human body. Typically, detecting the presence of microplastics requires expensive equipment and highly trained personnel.
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