New York (CNN Business)Add paint to the growing list of things that are getting more expensive.
Sherwin-Williams (SHW) announced Tuesday that “demand remains strong” for its paint and other products, forcing the retailer to hike prices 7% beginning in August. The company blamed rising costs of raw materials for the price increases — a pandemic trend as consumers have changed their purchasing behavior and supply chains have gotten messed up around the world.. Demand for residential paint jobs — both fixer-uppers and new homes — has remained strong, and the industrial side of its business has been recovering faster than expected.
CEO John Morikis said in a statement Tuesday that sales had been stronger than expected in the second quarter. leading the company to raise its sales and profit guidance for 2021. Sherwin-Williams’ full second quarter earnings will be released on July 27.
The stock, which was slightly down in premarket trading, is up nearly 50% since last year.Read MoreHome sales hit a 14-year high in 2020, with the annual median price of an existing home climbing to $296,500 according to a recent report — the highest price on record. Although paint could add just a small chunk of that, when added to other raw materials costs, home prices aren’t getting any cheaper.
Surging lumber prices alone have pushed the price of an average new single-family home $35,872 higher, according to an analysis by the National Association of Home Builders.The rising cost of paint is just the latest product forcing consumers to dig deeper into their wallets. A key measure of inflation, after stripping out more volatile food and energy prices, jumped to a 29-year high in April. The Bureau of Economic Analysis’ price index tracking US consumer spending rose 3.6% in the year ending April, its biggest jump since September 2008 — the height of the financial crisis.