NAHB Study Allows Remodelers to See Where They Rank

May 12th, 2020 by Emmariah Holcomb

The National Association of Home Builders (NAHB) Remodelers’ Cost of Doing Business Study, which assesses the growth and overall vitality of the industry, is now available in an updated 2020 edition. When used side-by-side with a 2018 income statement, a general or design-build remodeling business can gauge their own success by measuring against an array of benchmarks, gathered from the financials of over 3,500 members nationwide.

The new study shows the average gross profit margin for surveyed remodelers increased from 28.9% in 2015 to 30.1% in 2018, which shows the highest number in almost 30 years, according to the study.
The average net profit margin was essentially unchanged during the same period which was largely due to higher operating expenses.

“The new version of this publication, offers remodelers a great way to benchmark their business financials in comparison to other similar businesses across the country,” said NAHB Chairman Dean Mon.

NAHB predicts that over the next few years remodeling expenditures will continue to grow, but at a more gradual pace.

To conduct and complete the study, the association’s economics and business management experts collected and analyzed financial statements for fiscal year 2018 from remodelers across the country. The study provides detailed information on important indicators, including:

  • Gross and net profit;
  • Assets and liabilities;
  • Owners’ equity; and
  • Financial ratios.
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