Millwork in the US Industry Market Research Report from IBISWorld has Been Updated

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The Millwork industry has performed poorly in recent years, primarily due to the downturn in residential construction. With the housing market picking up, favorable demand for millwork products is anticipated. A recovery in the construction sector will drive industry revenue growth in the next five years as firms benefit from improved residential construction, which will return to more cyclical growth. Further, pent-up demand from first-time home buyers and more favorable economic conditions will breathe life into the industry. Competition from substitute materials like vinyl, however, is a growing concern for millwork manufacturers. For these reasons, industry research firm IBISWorld has updated a report on the Millwork industry in its growing industry report collection.

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A recovery in construction will boost demand, but competition from substitutes is rising.

The Millwork industry has performed poorly in recent years, primarily due to the downturn in residential construction. The industry manufactures wooden doors, window frames, floors and dimension stock (hardwood lumber that has been manufactured into specific dimensions). “The demand for millwork products is primarily linked to the level of activity in residential construction markets and, to a lesser extent, commercial and industrial construction markets,” says IBISWorld industry analyst Caitlin Moldvay. During the five years to 2012, the number of housing starts plummeted an average 11.7% per year, cutting demand for the industry's wood products. Consequently, over the five years to 2012, revenue is estimated to decrease at an average 8.2% annually to $19.8 billion. The housing market has begun to turn around, though, creating more favorable demand for millwork products. From 2011 to 2012, industry revenue is expected to rise 8.5%.

“Since mid-2006, falling residential construction activity has led to large-scale capacity reductions in the US wood product manufacturing sector,” adds Moldvay. “Meanwhile, buoyant growth in developing economies has put pricing pressure on many key inputs for US millworkers, such as preservation chemicals and oil.” These factors caused declining profitability for millworkers, forcing many to close up shop. From 2007 to 2012, the number of companies is estimated to decrease at an average annual rate of 2.8% to 3,658. The Millwork industry has a low level of market share concentration; the majority of companies in the industry are small- to mid-size companies with fewer than 26 employees per establishment. Transportation costs limit the geographic scope of operations; therefore, industry market share is expected to remain fairly low. Although the industry remains fragmented, market share concentration among the top four companies has increased slightly over the past five years. Growing market share concentration is primarily the result of increased acquisition activity on the part of major players, including Andersen Corporation.

The Millwork industry has also been challenged by rising competition from wood-substitute products. Windows and doorframes made of fiberglass, aluminum, steel and vinyl have become increasingly popular due to their durability and lower prices. Vinyl is a low-cost alternative to wood window and doorframes; therefore, it is one of the fastest-growing products in the window frame market.

Over the five years to 2017, conditions are expected to improve for industry operators, with revenue forecast to increase. The residential construction market's recovery is expected to accelerate in 2013, reviving demand for the industry. Also, rising per capita disposable income following the recession will positively affect investment in remodeling activity. Nevertheless, the industry will continue to face competition from substitute products and low-cost imports. For more information, visit IBISWorld’s Millwork in the US industry report page.

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IBISWorld industry Report Key Topics

This industry manufactures hardwood and softwood cut stock and dimension stock timber (lumber and worked wood products cut or shaped into specialized sizes); wood windows and doors; and other millwork, such as wood flooring. The reshaped wood products are sold mainly to housing and other building construction industries and their contractors, as well as to wood product distributors.

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Industry Life Cycle
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Globalization & Trade
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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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