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Executive forecast: Wood—Suppliers see the upside of opportunity for the coming year

December 10/17, 2018: Volume 34, Issue 14

By Reginald Tucker

 

Over the course of 2018, the industry saw several big announcements. Some domestic manufacturers shuttered their solid flooring plants, while an industry leader announced plans to sell its hardwood flooring operations altogether. The sector also witnessed greater strategic alliances among wholesalers and producers. Heading into 2019, the industry expects to see more seismic changes amidst modest growth projections.

 

Wade Bondrowski
Director of sales, USA
Mercier Wood Flooring

What is your projection for the growth of the category next year?We are anticipating another year of growth in the overall category of around 5%.

What are the growth projections for your company in particular in 2019?We are currently looking for high, single-digit/low double-digit growth.

What end-use segments and/or products will fuel this growth?It’s still housing, commercial with a little multi-family.

Cite a few major company initiatives for 2019.Having new products and technologies in finishing, along with our new display system should give a push in the right direction for 2019.

Identify the “X” factor that will impact business in 2018.The X factor is the housing market and interest rates, along with an uncertainty in the stock market and regulatory trade.

Where you see the greatest opportunities?We see opportunity all around us, but we need to stay focused and continue servicing our clients with the fashions that consumers are looking for.

 

Roger Farabee
president, wood & laminate
Mohawk Industries

What is your projection for the growth of the category next year?We’re predicting hardwood will be up about 2% in terms of dollars.

What are the growth projections for your company in particular in 2019?We anticipate we will exceed the growth rate of the overall category in 2019.

What end-use segments and/or products will fuel this growth?We expect engineered to continue growing while solid will decline. Within engineered, we still see the bulk of that being in residential remodel, less so in builder.

Cite a few major company initiatives for 2019.We will continue to focus on engineered, especially in our TecWood enhanced platform as well as all of our new products. We are also offering an alternative to solids without giving up the benefits of solid.

Identify the “X” factor that will impact business in 2018.LVT is still the wild card that will impact all categories. We will have to wait to see if that rate of growth continues.

Where you see the greatest opportunities?We still see the bulk of activity come from the residential remodel sector, but less so in builder.

 

Drew Hash
vice president, hard surface portfolio management
Shaw Floors

What is your projection for the growth of the category next year?We’re projecting growth in the mid- to single-digits next year.

What are the growth projections for your company in particular in 2019?We expect to be very much in line with the overall hardwood category growth.

What end-use segments and/or products will fuel this growth?A lot of our growth is geared toward that single-family part of the business, specifically in prefinished and engineered.

Cite a few major company initiatives for 2019.Extension of the Floorte resilient brand into hardwood; second, applying the topical surface-treatment technology utilized on our Repel laminate products on wood; and focusing on thicker, sawn-faced products.

Identify the “X” factor that will impact business in 2019.You’re going to see Shaw Floors delve into a wider spectrum of colors—something that we typically do in resilient but not in hardwood.

Where you see the greatest opportunities?We feel good about that in 2019. Our focus is definitely on the independent specialty retail channel.

 

Christopher King
Vice president of sales
Armstrong Hardwood Flooring

What is your projection for the growth of the category next year?

We are optimistic that demand for wood flooring will remain strong going into 2019 in both the new construction and remodeling markets.

What are the growth projections for your company in particular in 2019?We will enter 2019 with a singular focus on hardwood and supporting powerhouse brands such as Bruce. As an independent wood flooring company, we will enjoy greater flexibility to pursue strategic growth opportunities as we are 100% focused on hardwood.

What end-use segments and/or products will fuel this growth?We expect to see increased activity in the engineered sector, and we also see solid wood flooring remaining a go-to product in certain parts of the country. Wide-plank, long boards and low-gloss finishes will also continue to grow.

Cite a few major company initiatives for 2019.Innovation will continue with solid and engineered structures in all of our brands. Engineered offers opportunity for design innovation combined with its installation flexibility, and we will develop new, on-trend visuals in solid.
Identify the “X” factor that will impact business in 2019.Going into 2019, we will be closely watching the status of tariffs on wood flooring products imported from China and ongoing trade negotiations.

Where you see the greatest opportunities?Look for more in innovations in aesthetics and performance in 2019 with an increased emphasis on speed to market. We also see opportunities in commercial hardwood.

 

Dan Natkin
Vice president of hardwood and laminate
Mannington  

What is your projection for the growth of the category next year? Overall modest growth within the category given the headwinds from LVT. 

What are the growth projections for your company in particular in 2019?  Generally in line with the market.

What end-use segments and/or products will fuel this growth?Primarily upper-end wood products will see nice growth as consumer demand remains strong in that area. Lower-end hardwood will continue to cede share to printed products such as laminate and LVT.

Cite a few major company initiatives for 2019.We have just completed a major capital upgrade of our plant in High Point, N.C., and we will be launching several new products throughout the year that utilize state-of-the-art capabilities.

Identify the “X” factor that will impact business in 2019.The biggest X factor is the overall economy.  

Where you see the greatest opportunities? There is still very strong fundamental demand for hardwood. Capitalizing on the natural aspects of it presents some of the largest opportunity.

 

Paul Rezuke
Vice president, U.S. sales
Wickham Hardwood Flooring

What is your projection for the growth of the category next year?There are so many factors that can and will impact wood flooring positively and potentially negatively next year, namely the proposed implementation of future tariffs and anticipated interest rate hikes.

What are the growth projections for your company in particular in 2019?In spite of a high level of volatility, we are targeting 8% to 10% year-over-year growth. Assuming the landscape does not experience severe changes, this level is attainable.

What end-use segments and/or products will fuel this growth?In 2018, we experienced increased opportunities within the architectural and design segments of our industry. Our expanding engineered products will serve as the impetus for this continued growth.

Cite a few major company initiatives for 2019.We will be expanding our engineered products. You will also see wider planks, more diversity in our product look along with the resurrection of some of the more traditional colors. An acquisition in 2018 also increased our raw materials.

Identify the “X” factor that will impact business in 2019.There is no question pending tariffs and projected interest rates will have a significant impact on the industry in its entirety.

Where you see the greatest opportunities? Our opportunities lie specifically in the expanding geographic areas targeted. Over the past two years our footprint has been expanding, and it will continue to grow in 2019.

 

Brad Williams
Vice president of sales and marketing
Boa-Franc (Mirage brand)

What is your projection for the growth of the category next year? We project the overall hardwood category to have a moderate growth of 3% for 2019.

What are the growth projections for your company in particular in 2019? We project the overall growth to be moderate as well, coming in at 2% to 4% in 2019.

What end-use segments and/or products will fuel this growth? Wider and longer hardwood planks are getting more traction among consumers. New construction will also be a driver within the markets that are experiencing an increased population coupled with a good economy.

Cite a few major company initiatives for 2019. We will continue investing in updating our customer experience via mill tours at our factory. Seeing what goes into making a Mirage product is key for our customers to be able to sell the difference.

Identify the “X” factor that will impact business in 2019. The X factor will be the different innovations that our competition will be launching along with our own product launches.

Where you see the greatest opportunities? We feel our greatest opportunity continues to be within our existing network. We will continue to listen and try to understand our customer needs and focus on creating opportunities for them.