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My take: Crunching the numbers

June 20/27, 2016; Volume 30, Number 26

Screen Shot 2016-06-28 at 11.30.30 AMWelcome to our annual statistical report, the issue that is singlehandedly responsible for taking a couple of years off our lives. The information provided within these pages is not to be taken lightly; a lot of time, effort, research and conversations go into ascertaining what we believe to be the industry’s best snapshot of the floor covering market for 2015.

This year, as I have done over the past few years, I became entrenched in determining the size and scope of the resilient market: sheet vs. LVT, import vs. domestic, etc. I had my reasons. LVT is anecdotally growing at a clip I have not seen since the early days of laminate, and I wanted to see for myself the rate of speed at which the category was expanding. At the same time, I wanted to see how this phenomenon was impacting other resilient segments such as sheet and VCT.

There is really only one way to uncover the facts and come as close to the actual numbers as possible. That’s to get on the phone and speak with every resilient supplier that is doing any appreciable business in this country. With the promise that the information would only be used to compile aggregate numbers and they would remain confidential, just about every supplier was forthcoming. Only a handful of people were unable to provide relative exact numbers, but in those cases they were able to drive us to the ballpark.

Now here’s where the challenge lies for me. When everything was said and done, I felt the need to check and recheck the numbers. Why? Because I really couldn’t believe resilient grew about 14% in dollars and 17% in volume. I honestly questioned whether we could publish that kind of growth. Of course, it was driven by LVT. Residentially, we found a whopping growth rate of 38.6% in dollars and 68.3% in volume. The growth was not as pronounced commercially, where the category grew about 12.7% in dollars and 13.5% in volume.

Those numbers are still a little hard to swallow, but upon further review they make sense. First, you have to look at the white hot WPC category. It only broke onto the scene in 2013, gained some momentum in 2014 and took off like a rocket in 2015. Products like COREtec from USFloors and Floorte from Shaw could have accounted for about $200 million alone. And these products take more share from other categories such as laminate than they do from traditional LVT.

No. 2, traditional LVT as a category continues to grow. And No. 3, I am thinking that some of the LVT manufacturers reported as residential may find their way into some Main Street commercial applications since much of that is sold through the specialty retail channel.

A few more observations: The resilient category has grown $1 billion in the last five years, which equates to a gain of 58%. At the same time, volume has increased 38%. That substantiates the claim that better products are being sold. Despite some impressive technological advances in sheet vinyl, here is where the more expensive LVT has thrived. Back in 2006, sheet vinyl represented 59% of the category, or $1.4 billion. Today we see sheet vinyl as a business accounting for somewhere between $800 million and $825 million or about 30% of the resilient market. The decline is also seen in VCT, where in 2006 FCNews estimated sales to be about $450 million, an amount that dipped to $410 million in 2010. Last year, research reveals the category was somewhere in the neighborhood of $310 million to $325 million.