Half of the builders and dealers in an August industry survey said sales activity had declined from the previous month. The same survey showed employment holding steady and material prices putting no pressure on shed prices. Contradictory? Not really. Sales sentiment, employment, and input costs move on different timelines, and reading all three together gives a truer picture than any single number. The method behind these findings is the same used in business conditions surveys across construction trades, and it transfers to any building operation.
This article walks through what sales activity, employment, and material cost data actually measure, why the numbers can point in different directions, and how to build a monthly dashboard from the same categories.
Sales Activity: The Most Volatile Number
Sales activity is the number that moves first and moves hardest. In the August survey, exactly half of respondents reported a decline in sales activity compared with the previous month. The rest split almost evenly: 28.1 percent reported no change in new orders and 21.9 percent reported a slight increase. On a year-over-year basis, 54.2 percent said 2024 sales were lagging behind 2023.
A sustained drop in sales is the fastest route to protect your contracting business territory, which is why owners track the trend honestly month to month. The practices that keep a contracting business solvent start with catching a sales slide early, before overhead and payroll consume the reserves.
The Split in the Numbers
The survey found a comparable split between respondents showing no change in new orders and those showing a slight increase, against those indicating a decline. That split matters because it means the market was not falling uniformly. Some builders were holding or gaining while others lost ground, often for reasons specific to their lots, their region, or their price point.
Year-Over-Year Context
Month-to-month declines are easier to dismiss than year-over-year ones. When 54.2 percent of respondents report that current-year sales are behind the prior year, the slowdown is a trend, not a blip. On the brighter side, 51.7 percent said their backlog of existing orders stayed the same or increased compared with the past month, which meant the work already on the books was still there.
| Metric | Share of respondents |
|---|---|
| Sales activity declined vs. prior month | 50.0% |
| New orders unchanged | 28.1% |
| New orders slightly increased | 21.9% |
| 2024 sales behind 2023 | 54.2% |
| Backlog same or increased | 51.7% |
Employment: The Slow-Moving Indicator
Employment is the last number to move in either direction. In the August survey, 84.4 percent of respondents said employment levels stayed the same or increased in 2024: 61.5 percent reported no change and 22.9 percent reported increases. That stability ran against the grain of the sales numbers, and it deserves attention.
Why Employment Lags Sales
Builders do not lay off crews the week sales dip. They ride out short soft patches, run crews on maintenance and lot work, and hold skilled labor because rehiring is slower and more expensive than retaining. A protracted decline in sales would eventually force reductions as companies try to remain profitable, but the August numbers did not reflect that yet.
What Stable Employment Means
Steady headcount through a soft sales period usually means owners expect a recovery and are positioning for it. Some respondents said they expanded their sales areas, which is how they held workforce and backlog even as the market softened. The firms that adapt their model to the market’s rhythm, the argument Steve Mouzon develops in his essay on the new business of business, are the ones that keep their teams intact through the down part of the cycle.
- Employment flat with sales down: owners are holding capacity for a rebound.
- Employment up with sales flat: expansion into new territories or products.
- Employment down with sales down: the slide has moved past the tolerance point.
Material Costs and Their Effect on Shed Prices
Material prices drew the most positive response in the survey. A combined 90.5 percent of respondents said material prices had no negative impact on shed prices in the last month: 71.6 percent reported no effect at all and 18.9 percent said shed prices were actually lower. That pattern reflects a strong supply chain with competitively priced materials.
| Effect of material prices on shed prices | Share of respondents |
|---|---|
| No effect on shed prices | 71.6% |
| Shed prices lower | 18.9% |
| Negative impact on shed prices | 9.5% |
Two Explanations for Stable Prices
Stable shed prices through a sales slowdown can mean two things. The first is a genuinely strong supply chain: lumber and panels are available at competitive prices, so builders have no cost pressure to pass along. The second is reluctance: manufacturers absorb higher material costs rather than raise prices while sales are slowing, protecting volume at the expense of margin.
The Pass-Through Decision
During the Covid and post-Covid period, price increases were passed along routinely with little effect on sales. That calculus changes when demand is soft. Still, the long-term rule holds: rising material costs must be passed along for a company to remain profitable. Weather also moves both demand and material logistics, and builders who model projects with climate-responsive building design software build realistic seasonal schedules around delivery windows.
- Track material cost as a percent of sale price each month.
- Watch whether competitors hold prices when their input costs rise.
- Quote with a material escalation clause for jobs delivered months out.
- Review supplier contracts annually for volume pricing.
Seasonality: Timing the Market
The August survey captured sales during the middle of the summer months, when much of the country is on vacation. Builders expect a tick upward in sales activity as people finish summer trips and kids go back to school, and northern builders prepare for a storage-season boost as winter approaches.
The Seasonal Calendar for Shed Sales
Demand for backyard buildings follows a predictable arc in most regions: quoting and early builds in spring, a summer plateau, a fall push for storage and workshops before winter, and planning work through the cold months. Builders who front-load production before the fall rush capture the season’s peak prices.
Preparing for the Storage Season
Before the fall push, walk your own lots the way you would run a field condition survey of a building: check finished units for weather damage, warranty issues, and display condition while there is still time to fix them. A lot full of clean, sale-ready buildings sells itself.
- Schedule spring production starts around average frost dates.
- Plan a pre-winter finish line for all sold units.
- Inspect and touch up display units before the fall selling window.
- Shift marketing spend toward storage messaging in late summer.
Reading the Comments Behind the Numbers
Survey write-ins add the context percentages cannot carry. One builder reported shed sales down about 20 percent year over year in the same areas and sales locations. Another said business had dropped off but was coming back slowly. Several noted that adding lots in the previous 12 months had cushioned softer sales, which is why workforce and backlog held.
Expansion as a Hedge
The respondents who expanded their sales areas through a soft year turned a market problem into a market opportunity. More locations meant more exposure, and the expanded base offset weaker per-lot sales. That strategy carries cost, so it works best for owners with cash reserves and a repeatable lot model.
Cost Pressures to Watch
One respondent named the single biggest challenge of the moment: the frightfully increased cost of lead generation. Advertising costs rise when competitors chase the same shrinking pool of buyers. Energy costs sit on the same list, and the shift toward renewable energy sources is one way builders and homeowners cushion themselves against volatile utility and fuel prices.
- Track cost per lead and cost per sale every month.
- Compare advertising channels on closed sales, not clicks.
- Review delivery and utility fuel costs against quoted prices.
- Revisit lot locations when per-lot sales decline two quarters in a row.
Building Your Own Market Dashboard
Industry surveys publish quarterly, but your business changes monthly. A dashboard built from the same five categories gives you the signal on your own schedule, in your own market.
The Five Metrics
- Sales activity compared with the previous month.
- New orders in units and dollars.
- Backlog expressed in weeks of booked work.
- Employment and crew utilization.
- Material costs as a percent of sale price.
Measure Precisely
Define each metric before you start recording it. Surveyors capture exact conditions with a scan line survey, recording every point along a defined path with a repeatable method. A monthly dashboard deserves the same discipline: fixed definitions, a fixed date, and a permanent record.
Fill the sheet on the first business day of each month, compare it with the same month last year, and let the trends set hiring, pricing, and marketing decisions. The builders who see the next turn in the market will be the ones who recorded the one before it.