Industry Report: Fencing Construction

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Industry: Fencing Construction

Naics: 238990

Private Company Multiples

Industry Overview

The fence contracting industry has enjoyed a relatively prosperous period, buoyed by a robust residential construction market. However, the industry’s fortunes have been tempered by economic headwinds.

A surge in housing starts and home improvement projects, fueled by historically low interest rates, propelled fence contractor revenue to a 1.4% CAGR over the past five years, culminating in an estimated $20.6 billion in 2024. Yet, the industry’s profitability has been eroded by escalating material costs and labor shortages. The shift towards plastic fencing as a more cost-effective alternative to wood has also impacted margins.

While the residential market is cooling due to rising interest rates, the nonresidential sector is gaining momentum. This dynamic is expected to support continued industry growth, albeit at a more moderate pace. As interest rates decline and economic conditions improve, the residential market is projected to rebound, further bolstering demand for fencing services. Additionally, easing supply chain pressures and a loosening labor market will contribute to improved profitability.

The fence contracting industry is forecast to maintain a steady growth trajectory, with revenue expanding at a 1.7% CAGR to reach $22.4 billion by 2029. However, the industry’s profitability will remain under pressure due to ongoing competitive dynamics and economic uncertainties.

Key Financial Metrics

Income Statement Benchmark

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