How Profitable is a Painting Contractor Company in 2023?

With a current market value of $24.7 billion and an expected growth to $26.7 billion by 2028, the painting industry in the U.S. offers a promising opportunity for entrepreneurs. This article delves into the profitability of a house painting business, its revenue potential, and the costs involved in starting and running your own.

We’ll explore the financial landscape of the industry: What is the average revenue for a house painting contractor? How does this translate into daily work and annual income? These insights are crucial for anyone considering entering this competitive market.

Additionally, we’ll discuss the startup costs for a house painting business. From equipment and marketing to licensing and insurance, we’ll provide a detailed breakdown of the initial investment needed.

Finally, we’ll analyze the operating profit margin of a house painting contractor and the recurring costs involved in maintaining the business. This comprehensive overview aims to equip aspiring entrepreneurs with the knowledge to navigate the house painting industry successfully.

House Painting market overview

As per IBIS, the house painting market in the U.S. represented revenue of $24.7 billion in 2023 and is expected to grow to $26.7 billion by 2028.

Painting and decorating for newly constructed homes represent the highest share ($10.7 billion), followed by painting and decorating for additions and alterations ($7 billion), and painting and decorating for maintenance and repair ($6.9 billion). Yet, with over 178,000 painting businesses across the country, the competition is also fierce.

How much revenue does a house painting contractor make?

Using the same source earlier, it’s safe to assume that the average turnover for a house painting contractor is around $138,700. Indeed, the U.S. house painting and decorating industry is worth $24.7 billion and there are about 178,000 painting contractors across the U.S.

Now, using data from more than 990 franchised house painting businesses, a house painting contractor earns $782,000 in gross revenue per year on average. This number is the average gross revenue per contractor from 990 businesses of the 8 largest house painting franchises in the U.S.

With an average contract cost per house of $7,500, that’s a total of ~100 houses per year. Assuming 250 working days per year, that’s on average 2-3 days of work per house.

Yet, not all house painting contractors have the same yearly revenue. Logically, some will earn more than others because of many factors like

How much does it cost to start a house painting business?

On average, it costs between $94,000 to $186,000 to open your own house painting business.

This includes various costs such as equipment, supplies, inventory, and signage; vehicle maintenance; licensing, permits, professional fees, and insurance; office equipment, computer hardware, and software; training; marketing initiatives; real estate and improvements; and working capital for the first few months of business operations.

• Equipment, supplies, inventory, and signage (6%): Cost to purchase essential tools, painting supplies, inventory management, and professional signage for efficient and visually appealing operations.
• Vehicle (11%): This includes costs for the acquisition, maintenance, and operation of vehicles essential for a house painting business, ensuring timely and efficient transportation to client locations.
• License and permit, professional fees, insurance (11%): Funds covering the necessary legal permits, licensing fees, professional services, and insurance costs essential for compliance and protection;
• Office equipment, computer hardware, and software (8%): Costs of acquisition and maintenance of office essentials, computer hardware, and software for the smooth administrative functioning of the business.
• Training expenses (3%): Cost for training programs and skill development initiatives to ensure the continuous improvement and expertise of the personnel.
• Marketing (32%): Significant budget allocated for promotional activities, advertising, and strategic marketing efforts aimed at enhancing brand visibility and attracting clients to a house painting business.
• Real estate and improvements (3%): Cost of acquisition or lease, and improvement of physical business locations.
• Working capital (26%): Cost to cover day-to-day operational expenses like salaries and other admin expenses for the first 3-6 months of the business.

How profitable is a house painting contractor?

A house painting contractor earns ~25% operating profit margin (EBITDA margin) after operating costs (salaries, materials, etc.) have been incurred.

Indeed, there are various recurring costs involved in running a house painting business. The major expenses include the cost of services followed by :

• Cost of services (45-55% of revenue): This covers the direct expenses like materials and labor for providing house painting services.
• Marketing (5-10% of revenue): Includes expenses for advertising and promotions to attract clients.
• General and administrative expenses (10-15% of revenue): Funds for day-to-day operations, such as office costs, insurance, repair and maintenance, meals, etc.

Profit and loss	Amount (US$)	% revenue
Gross Revenue	$782,000	100%
COGS	$(398,820)	51%
Gross Profit	$383,180	49%
Marketing	$(54,740)	7%
General & admin expenses	$(117,300)	15%
EBITDA	$211,140	27%