Latest Retail Sales Report Shows Uptick for Building Materials Distributors

The recent release of the October Retails Sales by the US Census Bureau showed that sales by retailers of building materials and garden equipment and supplies rose in October 2021 – a rebound after a decline in September. Compared to this time last year, retail sales in the category were up more than 13%.

A number of factors can explain this sales increase, key among them:

• continuing strength in new home construction and homeowner interest in home improvement projects
• rising lumber prices (after a period of declines) and price hikes for a number of other key building materials, such as fasteners and drywall
• consumer interest in a last round of outdoor projects – such as preparing gardens and yards for the winter – that would necessitate the purchase of such items as leaf blowers and lawn and garden consumables
• strong sales of Halloween-related decorations – after trick-or-treating was canceled last year due to the COVID-19 pandemic, many consumers opted to create more extensive outdoor displays to celebrate the holiday

The November retail sales report – which includes Black Friday sales and the beginnings of Christmas shopping – will reveal whether or not building materials and garden equipment suppliers and retailers will be able to continue to post strong sales, or if concerns about inflation will cause shoppers to cut back on their holiday purchases in favor of basic household staples. TFG analysts will continue to monitor retail sales – as well as numerous other indicators – to gauge their effects on the US economy going forward.

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 Custom Research is also available for questions requiring tailored market intelligence.