Paint Price Hikes Continue
Think your supply costs are finally settling? Think again! Word on the street is there's another price increase coming...
11 October, 2021
As many contractors have discovered, Sherwin-Williams recently imposed a four percent surcharge on the majority of its products through the end of 2021 to cope with rising prices and raw materials shortages. Now the company has announced further price hikes, again due to difficulty in obtaining the raw materials. Some of this is a result of Hurricane Ida, which hit the Gulf Coast on August 30, and severely impacted or shut down the production capacity of the company’s suppliers in that area. Some raw materials costs, including resins, polymers, and even the steel used for making cans, have increased nearly 20% and are expected to rise even higher.
According to an article in the Cleveland Business News, in September the company lowered its sales and earnings expectations twice due to these shortages as well as to account for inflation. SW sees a strong demand for coatings but lowered its third quarter sales guidance to “flat to down slightly” as compared to Q3 2020.
On the plus side, the company reported it was keeping its manufacturing facilities fully staffed to it could meet the demand for coatings as soon as the shortages subsided, and President John Morikis noted that there were plans in place to increase production capacity of architectural coatings by 50 million gallons over the next six months.
The company’s recent acquisition of Specialty Polymers Inc. in Woodburn, Oregon, announced in late September, is part of the effort to ramp up production; and Morikis stated that the company continues to have the ability to produce once it can procure the materials needed. Sherwin-Williams announced a seven percent price increase, prior to the four percent surcharge, in August.
Other paint companies have also announced price hikes: PPG raised prices at least twice this year to compensate for higher costs in everything from materials to transportation to wage increases. Company President Michael McGarry stated that he didn’t see this trend abating anytime soon. The price hikes across the board are the steepest in the industry in quite some time.
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