Business Week Magazine reported recently that the "The seasonally adjusted PPI (Producer Price Index) for finished goods jumped a sharp 1% in January 2009. Perhaps more alarming, for the 12 months ended in January 2009, the PPI is up 7.4% on an unadjusted basis, the highest since October, 1981."
These inflationary trends can be seen in certain segments of the construction materials industry. For example, the cost of paint is significantly higher (16%) today than it was three years ago (see chart). The rise in the cost of paint is due to increased costs of raw materials and the reformulations required to meet new regulations for volatile organic compounds.
PAINT PRICE INCREASES:
11/08 to 12/08 5.3% 12/07 to 12/08 16.7%
09/08 to 12/08 4.9% 12/05 to 12/08 16.3%
Typically in any large commercial painting project the paint cost is approximately 30% of the bid amount. The other costs are labor, equipment rental (such as boom lifts) and the necessary taxes. To qualify each contractor's bid, request the number of gallons of paint that they are estimating to use on the project. If one contractor is estimating substantially less paint than the others it is a good indicator of a poor quality job. Paint material costs are going up but painting bids seem to be lower than ever…is this too good to be true? Often the answer is yes. Corners have to be cut somewhere to make a bid far less than the others.
In order to get a long lasting paint job (average of five to ten years), it is recommended to use a top of the line paint product, such as a 100% acrylic. There are three basic types of paint a contractor can choose from if the paint name and number is not specified and even stated contractually. These are:
The best plan for your next painting project is to have a paint supplier representative provide a free site inspection and write a specification based upon your needs.
- Vinyls - the least expensive with a 2 year paint life
- Vinyl/acrylics - a little better life expectancy depending on color but should not be used on wood
- 100% Acrylics - one of the best paints for longevity and color retention. However, the percentage of solids within each product may vary greatly depending on price and surface to be painted.
Ghaster Painting & Coatings