The U.S. Market for Fence, Deck and Rail Products

BusinessMarketing & Advertising

  • Author David Zheng
  • Published December 5, 2008
  • Word count 617

These are uncertain times in the housing and home improvement industry, especially for arenas that may be considered non-essential to consumers, such as fence, deck & rail (FDR) products. This all-new SBI report covers the market for residential FDR products made from wood, metal, vinyl, plastic and concrete. While many market studies strive to analyze market sizes and dynamics from the "sell side" perspective by attempting to measure the revenues earned by product and service vendors of materials, this study also focuses strongly on the "buy side" of the market by looking at indicators of demand among builders and consumers. This is key, as the FDR market is so closely tied to residential housing and economic issues affecting buyers.

SBI estimates that the residential FDR market reached a record $11.9 billion in 2006; however, 2007 proved to be a tough year for the industry as homeowners reigned in spending and homebuilders pared back on construction. While there are some factors that may help lessen the blow felt by the housing and economic slump, such as lower interest rates and an unending consumer desire to spend on home improvements and outdoor living, they are not strong enough drivers to cause a turnaround in the near term. The market of fence such as temporary fence,wire mesh,fence manufacturers,steel fence post,wire fence,portable fence is likely to continue to correct downward into 2008, but should begin to pick back up thereafter.

The report further explores economic, housing, consumer and product trends, as well as consumer home improvement activity, distribution channels and the competitive environment affecting domestic, residential FDR product demands. The report also profiles major marketers, along with manufacturer strategies to maximize growth and profitability.

Data were obtained from government sources, trade associations and publications, business journals, company literature, investment reports and interviews with industry stakeholders. In most cases, historical data are provided for 1998 through 2007, with forecast data from 2008 to 2012. Market size statistics are derived from U.S. Department of Commerce and other data sources, and are augmented by SBI estimates. Simmons Market Research Bureau's spring 2007 survey, based on a sample of 24,136 respondents, provides the primary research data on consumer remodeling habits and home improvement expenditures.

After a 16% decrease in sales, 2007 proved to be a tough year for the residential FDR market, which settled at $10.1 billion. Nonetheless, a new report from SBI, The U.S.Market for Fence, Deck & Rail Products, forecasts that the market will resume its upward trend and reach $11.8 billion by 2012. A four percent growth rate is predicted in 2009, with seven to nine percent continued growth through 2012.

Commodity prices play an especially important role in the FDR industry.Increasing oil prices have impacted the cost of running a business and the cost of goods sold.Lumber prices are at the mercy of the U.S. economy, as is the health of the housing market, which also plays a large part in the FDR industry.

The industry will likely get a boost from an increased interest in home remodeling, which is projected to grow by 62% from 2006 to 2016. Much of the demand for outdoor remodeling work will be driven by affluent households with incomes of $75,000 or more. In addition, there is a higher demand for outdoor living products among "upscale" homeowners.

"As the housing and construction market continue to struggle, green building products have been a bright spot," comments Cathy Minkler, Associate Editor of SBI. "The booming green building market will continue its rapid expansion over the next four years and is expected to double in revenue. The FDR industry has the potential to be on the cutting edge of the green transformation, especially through the use of composite, vinyl and other wood-alternative products that are engineered with added environmental benefits."

David ZHENG is the CEO of http://www.china-fence.com .A company specialized in selling all kinds of fence products such as temporary fence,wire mesh,fence manufacturers,steel fence post,wire fence,portable fence etc.

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