Paint Shortage Impact: High-Margin Products


As the global paint shortage continues, we are starting to feel the impacts in specific areas.  The first of which is a switch to producing only high-margin products. In an effort to recover from historic financial lows caused by supply constraints and inflation, Sherwin-Williams — one of the largest paint corporations in the United States — is choosing to shift production of its standard offerings with high-margin products. Ultimately, this will cause the price of commercial painting projects to increase as higher-quality paint will be the only remaining option from the nation’s leading paint manufacturer.

High-Margin Paint Products Dominate the Market

Following Hurricane Ida, Sherwin-Williams’ access to raw materials plummeted, forcing the company to make some difficult decisions when it came to their product line. Rather than using raw materials for products that don’t have high margin, the company is focusing instead on creating paints that will net them the biggest return.

According to John G. Morikis, chairman and CEO of Sherwin-Williams, the company does not expect to see any improvements in raw materials supply or pricing. Additionally, suppliers are reporting that the impacts of Hurricane Ida are more serious than initially thought. With reduced access to the raw materials used in some of the company’s more popular paints, they must rethink their product line, substituting low-quality, low-margin paints with higher-quality, pricier products.

Why High-Margin Products Could Further the Paint Shortage

The switch to high-margin products will lead to reduced access to more affordable paints for commercial painting projects and especially industrial coatings. As Sherwin-Williams shifts its focus to creating higher quality paints, products that once were easily accessible will become increasingly difficult to obtain. If you have a commercial paint project on the horizon, the best advice we can give is to schedule it sooner than later. Doing so will give your painting contractor the opportunity to locate the paints you need before they disappear altogether. Additionally, you’ll be able to capitalize on lower prices before they inevitably rise again in the near future.