Webb Analytics’ 2023 Construction Supply 150 Is Out: Report Shows Revenue Gains Dropped, Big Differences Persisted Between Lumberyards, Home Centers, Specialty Dealers

Webb Analytics' latest Construction Supply 150 reveals major changes in 2023 revenues compared to 2022.

Dramatic falls in lumber prices caused America’s biggest sellers of building materials to record in 2022 less than half the revenue gain they achieved the year before, Webb Analytics’ latest Construction Supply 150 (CS150) reveals.

The group, which arguably accounts for two-thirds of all construction product sales in America, took in $409.68 billion from their U.S. operations. That’s a 9.5% gain from the year before. In contrast, the members of last year’s Construction Supply 150 posted a collective 19.2% increase.

Subgroups within the CS150 saw even bigger changes, Webb Analytics found. Lumberyards with manufacturing capabilities recorded an 18.1% rise in revenue in 2022 compared with a 58.6% increase the previous year. Even home centers and hardware store chains were affected by lumber’s price plummet. Their revenues rose just 3.3% in 2022 vs. 11.1% the year before. In contrast, specialty dealers—companies that specialize in sales of roofing, siding, and similar products rather than lumber—posted roughly the same sales gain: 24.6% last year vs. 26.5% in 2021.

“Prices paid at the mill for major lumber species dropped 62% to 73% between January and December last year,” noted Craig Webb, President of Webb Analytics and CS150’s author. Much of the CS15 was affected—even giants like The Home Depot, which posted only a 4.3% rise in part because lumber sales rose 0.8% in 2022 compared with 18% a year before.”

The entire 58-page PDF report is available for download at https://www.webb-analytics.com.

The number of branches in the U.S. run by CS150 members grew 5.3% to 14,972, and the full-time employee count increased 3.4% to 992.248.

Some of these numbers might differ from what CS150 companies have reported publicly because the report separates members’ activity in Canada and Mexico. Operations in those countries added $20.81 billion worth of revenue to CS150 members’ coffers, 0.8% less than in 2021. The location count rose by nine to total 893.

The CS150 collects data for most but not all of the biggest building material suppliers, but it isn’t an exact list of the nation’s 150 biggest dealers because some private companies decline to reveal their numbers. Webb Analytics estimates the entire construction supply market has risen to $615 billion. Based on that estimate, the CS150 companies account for two-thirds of the total.

Among other findings:

• A total of 140 companies reported revenue gains, but only 117 grew faster than the 6% inflation rate.
• Consolidated numbers mask a lot of variations in the customers served by the CS150. For instance, operations with over $1 billion in revenue are up to 2-1/2 times less likely to sell to custom dealers than are dealers with under $1 billion. At the same time, billion-dollar dealers do half again as much business with production builders as do smaller companies, and they’re several times more active with commercial accounts.
• The report sheds more light on the role dealers play in manufacturing and installing building materials. Eighty-two companies showed some revenues from manufacturing and/or installing. Exclude the Home Depot and Lowe’s from those 82 and the remaining 80 generated 33.8% of their revenues—roughly $17.57 billion—from making and installing products.
• Credit-card transaction fees turned out to be a major expense in this low-profit-margin industry. The 94 dealers who provided data said the fees amount to 1.15% of their total revenues—roughly $180 million sent to card processors.
• The vast majority of responding CS150 members said they will hire a person with a misdemeanor on their criminal record, and 40% would hire someone who had a felony.
• Excluding The Home Depot and Lowe’s, CS150 members said women made up about 24.5% of their workforce, while 34% of employees were minorities.
• Companies that got 100% of their sales from professional builders and remodelers posted a 28.2% revenue gain, while businesses with more retail customers than pros saw only a 3.9% increase.

About Webb Analytics

Webb Analytics is a data and research consultancy that helps executives in construction supply spot the trends, threats, and opportunities that matter most. It’s led by Craig Webb, one of the nation’s best-known industry figures and the former editor-in-chief of ProSales, the construction supply industries most honored publication. Aside from the Construction Supply 150, Webb Analytics also produces an annual deals report, consults with dealers, publishes research reports and speaks at industry events. Contact him at cwebb@webb-analytics.com