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Latest Retail Sales Report Shows Effect of Product Shortages on Building Materials Retailers

The latest retail sales report showed that for many industries, solid sales gains were the order of the day. However, for building material and garden supply retailers, the picture was mixed – while sales remained high, on a monthly basis, June retail sales posted a slight decline from the level seen in May.

This ongoing strength in sales – as noticed earlier – has been driven in large part by the DIY consumer, as homeowners suddenly found themselves with plenty of time to complete home improvement projects, such as installing or repairing decks and fences, installing flooring, or reconfiguring rooms into home offices and gyms. But, this surge in buying activity has caused an unintended effect – a shortage of the pressure-treated lumber often used in these projects as lumber mills have yet to boost production to meet demand.

This shortage of lumber – and the various building materials crafted from pressure-treated lumber – has affected retail sales, and will continue to do so going forwards as construction professionals ramp up their own activities in anticipation of the busy summer season. Some DIY homeowners – frustrated by delays in obtaining lumber or its high cost – will move on to other projects, while others will reduce the size and scope of projects until materials are available at the desired price. Until lumber mills can increase pressure-treated lumber suppliers, this shortage of lumber may continue to be a drag on building material suppliers’ sales.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly in the Construction and Building Products. Freedonia also offers an expanding catalog of COVID-19 Economic Impact reports, which highlight how various industries are responding to the current crisis with a comparison to recent recessions. Freedonia Custom Research is also available for questions requiring tailored market intelligence.