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Domotex asia/ChinaFloor: LVT takes center stage while ITC case is pending

SHANGHAI, CHINA—First it was the laminate category, in recent years it has been the wood sector, and while each still played a prominent role at this year’s Domotex asia/ ChinaFloor (DACF), it was the explosion of luxury vinyl tile (LVT) that dominated the 13th annual trade show here.

Not only was just about every resilient manufacturer showing some type of LVT product, a plethora of companies that up until this year focused on wood and/or laminate were unveiling their own versions of LVT.

Just how large was this segment of the show? While a comprehensive breakdown of the market’s figures were not available at press time, officials estimated resilient flooring exhibitors jumped 25% over last year’s event, accounting for more than 15% of the 1,060 exhibitors that made up DACF ’11, and making it undoubtedly the fastest growing section. All told, Kitty Bai, DACF show director, said exhibition space grew 15% over 2010 to more than 1.1 million square feet. And, with pre-registration numbers up 80%, the 39,343 visitors who actually attended the three-day event were “virtually identical to last year’s record-breaking crowd.”

Thomas Baert, president of Chinafloors/Lamett and a founder of the show, said from new products and innovations to the continued growth of China’s economy and the overall Asian region, DACF is a show “not to be missed [by anyone] in our industry. Whether you want to do business in Asia Pacific or anywhere else in the world, this is the place to get a full overview of what is going on.”

On the LVT onslaught, Baert’s company was among those throwing its hat into the ring. He noted the move fits into the company’s general strategy to offer customers “a broad range of high quality, well designed, sustainable and easy to install flooring systems. [We] now have the most complete offering of floating floors in the industry, going from solid, engineered, laminate as well as LVT.”

In an interesting twist, the company, which has not only manufactured its own laminate and wood products at a state-of- the-art facility here but also private labeled them for Western customers, entered into a joint venture with an existing Chinese vinyl manufacturer for its LVT products which, similar to its other hard surfaces products, will be marketed in the U.S. under the Lamett brand.

“Just as we did with laminate and wood flooring,” Baert said, “we will focus on product development and innovation to also become a leader in this category. And our customers like the idea of being able to consolidate their purchasing with one manufacturer.”

Another non-traditional resilient player getting into the LVT market is Elegant Living, one of China’s largest and best-known wood flooring companies. Ray Kwan, general manager of international operations, said based on how LVT has been accepted at the consumer level—including in China—and the technological advances made in manufacturing, the company felt “the time was right” to offer the product. “With the technology available today, it has become a good substitute for other types of flooring.”

In addition, as the mill, like many other companies, continues to expand its market presence in China as opposed to being mostly an exporting company, he said LVT is an opportunity to expand its offerings. “Last year at this time we had 500 stores; now we have over a 1,000 and our aim is to reach 1,500 by year’s end.” (Editor’s note: The way flooring is sold to consumers in China is far different than that of North America as mills control the entire process. FCNews will showcase the differences in a future issue.)

Lock down

It was more than just an explosion of LVT products that stood out, as there was no shortage in ways to install them. As they have in laminate and, more recently, wood, mechanical locking systems were being sported on most of the new LVT offerings.

Interestingly, it was not just the traditional glueless systems from names such as Välinge and Unilin that dominate the locking system landscape—though they were extremely prevalent at DACF—there were a host of methods being exhibited as alternatives.

While some seemed more valid than others in terms of their viability, especially in the more demanding consumer markets of the U.S. and Europe, there was a multitude of ideas coming from what show officials are now calling the largest floor covering market in the world.

As Tarkett’s Jeff Katz told FCNews while scouting the various technologies, “This is a great market to see new, unique and innovative things, from products to installation systems to surfacing techniques. The problem is most of the new technologies are not fully tested or proven in the market. That’s why, before we release anything new, we fully test it to make sure it performs up to our standards.”

Two that were making their mark were both developed by Chinese companies but are being marketing under Western companies. One was SuperClick, which is described as “a revolutionary LVT floating flooring system” that was designed “to provide a new generation of flooring in response to demanding markets.” Stewart Procter said it took three years to develop the system and since being launched it has “received tremendous response, even from the largest manufacturers around the world.”

As proof, the company has signed a distribution deal with Abingdon Flooring for the UK and Ireland. SuperClick is set to make a mark in every country, he noted. “We are already holding discussions with a number of leading flooring distributors in other countries and wish to make our mark across the globe. There are also plans to expand by manufacturing the product in a number of other countries.”

Michael Poulin of Canada’s Maple Leaf Lamisol Corp., noted the company’s Press & Lock system is not only patented but is already being used on products in the U.S., some under its Aquarius and second-generation Atlantis—a pure LVT—brands and some under private-label agreements with distributors.

“We’re gaining more interest in the U.S. as people see how simple and durable both the product and installation system are,” he said. Touted as being waterproof and easy on subfloor imperfections, Poulin said the locking system is unique in that every time it is walked on “you are technically locking it.”

ITC case looms large

While there was plenty of noise in the resilient halls, the generally upbeat wood and laminate pavilions had a somewhat reserved nature due to the pending federal investigation of engineered wood flooring dumping and unfair competition allegations by a group of U.S. manufacturers against a large number of Chinese suppliers.

Going into the show the industry knew the first preliminary decision in the case was expected to be announced during the market. It came late on the second day (see related story).

As a result of the uncertainty hanging in the air, many companies did not go all out with the pomp and circumstance in their booths for which DACF has come to be known. Some even reduced their booth size due to many U.S. customers staying put on their buying decisions until they knew more or going to alternate suppliers from other countries. While Verde Flooring kept its sizable booth, Randy Cox, vice president of marketing, said on day one of the show, “It’s killing people on making decisions. I can’t blame them, but we’ve got a ton of customers wanting to continue or start working with us, but they have to wait.”

Like many of the wood suppliers, he added that prior to the show a number of American customers canceled their appointments saying they were taking a wait-and-see attitude.

Kenton Xia, director of marketing and international business development for Sino-Maple, said the company was “just waiting to see what happens.” He said it is planning for both ends of the scale, adding no matter the result it can be looked at as either positive or negative. Even with a high tariff, “it can be a positive for companies willing to invest and be patient, or it can be a negative for those who don’t plan ahead.”

As the largest exporter of engineered wood to the U.S. by volume, John Zhao of Layo Floor, said, “We’re paying close attention but now we’re just waiting.” Like many of the companies who participated in the case, he said the accusations go against what Layo is about. “Many of our raw materials are imported from the U.S. because we believe in providing quality products, not dumping a bunch of low-end goods. That doesn’t fit our structure.”

(Editor’s note: As the largest flooring market in the world, there was more going on at DACF than just LVT and the anti-dumping case. For instance, the push by Western companies to enter the Chinese market and more Chinese mills focusing on the domestic market compared to exporting as the country’s middle class swells to levels beyond the entire population of the U.S. FCNews will provide continuing coverage in upcoming issues.)

-Matthew Spieler