Demand for plumbing services is expanding rapidly as construction activity accelerates
New York, NY (PRWEB) September 16, 2014
While the Plumbing Service Franchises industry benefits from fairly stable demand from homes and businesses that need repair and maintenance of water delivery systems, the industry's performance is directly linked to building construction markets and consumer spending levels. Consequently, the strong rebound in construction activity, corporate profit, and consumer spending has benefited industry operators greatly. In 2014, industry revenue is expected to rise 9.1% to $2.2 billion in light of strong growth from the residential construction market, which accounts for 63.7% of the total market. Overall, IBISWorld expects that Plumbing Service Franchises industry revenue will increase at an average annual rate of 5.7% in the five years to 2014, although growth is partly due to the recovery from recessionary lows.
According to IBISWorld Industry Analyst Omar Khedr, “Plumbing franchises, over the past five years, have been able to gain market share from independent plumbing operators due to higher advertising power along with increased name recognition.” Plumbing franchisees benefit from efficient operating systems, group buying power as well as vendor rebates that often allow them to compete more effectively than independent service operators. These competitive advantages also allow plumbing franchises to be more profitable than independent service operators, with profit margins among industry operators reaching 4.5% in 2014.
“The industry is expected to continue growing in the five years to 2019, fueled by demand for new housing and renewed construction of commercial, industrial and institutional buildings,” says Khedr. Following trends in population and economic growth, higher construction activity in the next five years will translate into more pipes, drains, sinks and toilets that need installation and repair. Housing starts are expected to increase significantly over the next five years, expanding the industry's pool of customers that may need assistance with clogged drains or broken pipes. Rising income levels will also motivate private investment in home remodeling projects, such as bathroom and kitchen renovations, stimulating demand for industry services.
For more information, visit IBISWorld’s Plumbing Service Franchises in the US industry report page.
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IBISWorld industry Report Key Topics
The Plumbing Service Franchises industry operates franchised plumbing service companies. Reports in our Business Franchise collection focus solely on the operation of franchised outlets and exclude non-franchise data. They show the total number of franchise outlets, total franchise revenue and the average profit margin earned by franchisees. Our reports also highlight the largest franchisors by market share.
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