9 Moves to Keep Your Margin, and Your Sanity, When Demand Won’t Sit Still
A CEO Playbook for 2025‑26
Mortgage headlines keep seesawing, federal dollars drip (or stop) into job‑site backlogs, and a single distributor can now veto your price increase. In this article we’ll map the nine highest‑impact actions a building‑products CEO should take between now and the end of Q1 2026.
The Ground Is Still Shifting... Fast
Rates: The 30‑year fixed sits at 6.74% and has bounced 10–15 bp after every Fed press conference this summer. (Freddie Mac)
Builder Mood: 57% of new‑home communities now dangle incentives; price cuts are the rule, not the exception. (Zonda)
Lot Strategy: Public builders option 74% of their land, double the share in 2017, to stay “land‑light”. (Business Insider)
Pro Sentiment: The Farnsworth Group Contractor Confidence Index slid again in Q2 2025 as lead volume softened. (thefarnsworthgroup.com)
R&R Tailwind: Home Improvement Research Institute (HIRI) still expects +3.4% growth for home‑improvement products in 2025, led by roofing, insulation and gypsum. (HIRI)
Channel Power: QXO’s $11B take‑over of Beacon closed April 29, instantly making it the largest roofing distributor in the country. (investors.qxo.com)
TL;DR - Volatility is the only constant, so your GTM has to flex like never before.
The 9 Priority Moves
Print this list. Pin it above your desk. Every other decision should ladder up to one of these nine.
Lock a dual‑curve demand forecast. One plan for a 6.5% mortgage world, another for 7%+.
Defend margin with index‑linked pricing. Tie metal‑heavy SKUs to CRU HRC + freight; adjust monthly.
Dilute single‑buyer risk. Keep ≤ 25% of sales with any one distributor; grow regional share.
Shift 5‑10% capacity into rate‑insensitive segments. Infrastructure, data centers and exterior R&R are the buffer.
Launch builder price‑lock / option programs. Mirror the land‑light model so you stay in spec when starts resume.
Pulse mid‑funnel, spec‑lock marketing. BIM objects, CEU webinars and performance calculators > broad awareness.
Hold a 10% “rate‑pivot” budget reserve. Be ready to fire promos within 72 hours if mortgages break below 6.5%.
Filter federal‑funded bids by appropriation status. Chase only projects with executed IIJA / CHIPS money.
Stand up a weekly volatility dashboard. One page: 30‑yr rate, builder incentive share, CRU HRC, contractor confidence, IIJA obligations.
Why Dual‑Curve Forecasting Comes First
A forecast you can’t act on isn’t worth the spreadsheet it rides in on. Here’s a snapshot of the two demand bands every leadership team should model:
Single-family starts
• Base Case: Flat YoY
• Stress Case: –10%Builder incentives (share of communities)
• Base Case: ~40%
• Stress Case: 50%+Pro-remodel revenue
• Base Case: +3–4%
• Stress Case: +1%
Why two curves? A 25‑bp Fed surprise can happen between board meetings. Having capacity, cash‑flow, and marketing dials pre‑set for both scenarios eliminates the scramble.
Implementation checklist (one‑month sprint)
Align variables. Finance, sales, and ops sign off on the same mortgage‑rate breakpoints.
Map SKU elasticity. Identify which products fall >10% when starts drop—those join the “watch list.”
Link to S&OP. Production levels, raw‑material buys, and working‑capital lines should reference the active curve.
Review weekly. If Freddie Mac prints 7.0%+ two Thursdays running, flip to the stress plan—no debate.
(We’ll unpack the mechanics, including a template model, in next week’s article.)
Putting It Together: August 2025 → March 2026
August: Finish the dual‑curve model; issue metal‑index price bulletins; shift 5% of capacity to panelized non‑res SKUs.
September–October: Launch builder price‑lock program, weighted MDF to Midwest & Northeast markets still showing sales resilience.
November–December: Publish your IIJA Funding Checklist; hedge Q4 metal needs before holiday liquidity thins.
Q1 2026: Watch Zonda’s builder‑incentive tracker. If >50% of communities are discounting, tighten housing‑sensitive forecasts another notch.
Need a sanity check on your own dual‑curve forecast? Book a 30‑minute strategy call. We’ll benchmark your exposure to rates, tariffs and one‑buyer risk before Q4 bids go out.
See you in the trenches