Patching Up: Rebounding Construction Markets will Revive Demand for Industry Products

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As a result of reduced construction activity over the past five years, the roofing, siding and insulation wholesaling industry experienced declines. Low consumer confidence and declining disposable income also hurt demand for industry products used for home improvement projects. Roofing projects, which are less likely to be postponed, made up the majority of revenue over the period. In response to the recovery in downstream construction activity, particularly in regard to new-home construction, industry revenue is expected to rise. For this reason, industry research firm IBISWorld has added a report on the roofing, siding and insulation industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

As consumers resume spending on home improvement projects, revenue will recover.

The US construction slump set back the Roofing, Siding and Insulation Wholesaling industry over the past five years. According to IBISWorld industry analyst Andrea Alegria, “As the volume of construction projects in both residential and commercial markets shrunk, demand for roofing, siding and insulation products dropped, causing revenue to decline at an average annual rate of 4.4% to $21.3 billion in 2012.”

This industry primarily sells products to builders and developers, who use them for new construction of housing and commercial buildings and for repairs and renovations. Alegria adds, “As a result of the reduced housing construction activity of the past five years, contractors reduced the volume of roofing, siding and insulation products typically ordered from industry wholesalers.” The same was true for contractors that specialize in new construction of office, retail, hospitality and other commercial buildings because the total value of private non-residential construction declined sharply during the period.

Low levels of consumer confidence, high unemployment and declining per capita disposable income also hurt demand for industry products used for home improvements. Nonetheless, reroofing projects are less likely to be postponed than other construction projects during periods of recession or slow economic growth, which helped industry sales during the downturn. Roofing products for repairs of existing buildings accounted for the majority of revenue in the five years to 2012. Storms, such as hurricanes and tornadoes, also helped steady the stream of demand for these products.

In response to the recovery in downstream construction activity, particularly in regard to new-home construction, revenue for the Roofing, Siding and Insulation Wholesaling industry is expected to rise. In the five years to 2017, domestic housing starts are expected to increase, and demand for industry products is also set to get a boost from downstream retailers as consumer spending on home improvements rises with per capita disposable income. Sustained growth in most downstream building markets will boost demand for industry products. Industry enterprise figures are forecast to remain relatively stagnant over the period as operators continue to make acquisitions, increasing the industry's concentration of ownership. However, employment numbers are projected to increase.

The industry has a low concentration of ownership. The three largest players include American Builders & Contractors Supply Co., Beacon Roofing Supply Inc., CRH PLC. The low degree of concentration implies a high level of price competition and low profit margins on the industry's products.

The industry has a highly fragmented structure and comprises many small-scale establishments servicing narrow regional markets. The fragmented structure of this industry is evident from the distribution of establishments by employment size in the annual survey of County Business Patterns. The larger-scale players tend to be multiestablishment companies with wholesale and distribution operations in each key regional market.

For more information, visit IBISWorld’s Roofing, Siding & Insulation Wholesaling in the US industry page.

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IBISWorld Industry Report Key Topics

This industry comprises establishments that wholesale nonwood roofing and nonwood siding and insulation materials. Sales are typically direct to building contractors, large retail hardware chains and small independent hardware stores.

Industry Performance

Executive Summary

Key External Drivers

Current Performance

Industry Outlook

Industry Life Cycle

Products & Markets

Supply Chain

Products & Services

Major Markets

Globalization & Trade

Business Locations

Competitive Landscape

Market Share Concentration

Key Success Factors

Cost Structure Benchmarks

Barriers to Entry

Major Companies

Operating Conditions

Capital Intensity

Key Statistics

Industry Data

Annual Change

Key Ratios

About IBISWorld Inc.

Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit or call 1-800-330-3772.


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Gavin Smith
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