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Made in the USA: Effects of policies on reshoring activity

April 29/May 6, 2019: Volume 34, Issue 24

By Reginald Tucker

 

Some of the key economic policies instituted by the Trump Administration were designed to reduce the tax and regulatory burden on U. S. corporations to create an environment that would attract (or retain) investment in domestic manufacturing.

This change would improve the absolute ROI on U.S. investment, motivating and enabling all U.S. companies to grow faster by investing at home. At the same time, the U.S. ROI would be improved vs. offshore investments, leveling the playing field with some of our primary trading partners—namely China—by encouraging U.S. manufacturers to take advantage of lower taxes by reinvesting in their stateside operations. The changes would also encourage those companies who already produce outside the U.S. (or are planning to do so) to “reshore” those operations and bolster their domestic capacity and, by extension, American jobs.

FCNews recently caught up with Harry Moser, founder and president of the Reshoring Initiative, and an authority on all things concerning domestic manufacturing, to discuss these issues. More importantly, to find out if the stated objectives are meeting the intended goals.

Following are excerpts of that conversation:

Is there a direct correlation to the number of manufacturing jobs coming back to the U.S. and the Trump Administration’s policies on taxation, trade and tariffs?

There’s a direct correlation between these government actions and the reshoring trends. The lower tax rate—specifically taking it down from 35% to 21%—makes the return on investment in a U.S. facility much more competitive than it was before. Also, the immediate expensing of capital equipment helps companies finance the investments. In the past, suppliers had to depreciate any new equipment they purchased over the course of seven years, basically for tax purposes. Now, they can write off the equipment in the same year in which they made the investment. This includes a factory, machine tools, a steel mill—whatever. This helps reduce their tax in the current year because they have all that depreciation. However, it hurts suppliers in the second year/third year because they don’t have those years of depreciation. It shifts those write-offs forward to the year in which those expenditures are made. This definitely motivates business owners to invest in capital now.

Research shows the U.S. economy saw a bump in 2017 as a result of the tax cuts. Has that spilled over into 2018?

In 2017 we had 170,000 (announced) manufacturing jobs come back to the U.S. But in 2018 the responding number was 145,000—down 14.7% from the year before. However, it’s still the second highest number of manufacturing jobs reshored, and it’s two or three times the average of the last 10 years, excluding 2017.

To what do you attribute the lower number in 2018 compared to 2017?

We believe it’s because of the uncertainty caused by the trade war with China and all the issues with the tariffs. It’s a lot of back and forth. Companies don’t know what’s going to happen with the supply chain or the market. Therefore, the easiest thing for them to do is stay in a holding pattern. But it’s all relative; if we didn’t have such a huge year in 2017, we would be bragging about 2018, because it’s up a lot from 2016.

Looking at the various manufacturing sectors, what industry was most impacted in 2018?

Most of the falloff in the reshoring numbers—specifically two-thirds—was in the auto- motive category. So if you look at the number of companies announcing reshoring jobs and/or foreign direct investment (FDI)—they’re up 35% from 2017 to 2018. But we didn’t have as many of the big gains when, for example, Nissan or Toyota puts in a whole new assembly plant. Announcements such as these typically result in the reshoring of 3,000-5,000 positions, not including the smaller, local suppliers who add anywhere between 500 and 1,000 jobs to support the additional capacity. Most industries were OK, but the transportation equipment number was off substantially.

Do you expect to see companies continuing to reinvest?

We saw a decent rise in capital expenditures, but now it’s tailing off a little bit. Again, that’s due to all the uncertainty surrounding the China tariffs—the aluminum and steel tariffs and the threat of automotive tariffs.

Is this strategy sustainable?

President Trump keeps bringing up new stuff—I think he has too many balls in the air. If he had just stuck to, ‘Hey, we’re going to fix the trade deficit’ and maybe left all our trading parts alone and just focused on China—and perhaps gotten all of the other countries to help him—I think he’d be in a much better position today than having put aluminum and steel tariffs on our allies and threatening them with various actions. I think the reshoring numbers and FDI numbers would be much better if he had done that.

Where do we stand today on trade with China?

The Chinese trade surplus with the U.S. is about $400 billion a year in their favor in terms of goods. By comparison, the Chinese trade surplus with the world is about the same number. So when you boil it down, China is “trade-neutral” (or trade balanced) in aggregate with the rest of the world, but it has a $400 billion a year trade surplus with the U.S. That represents about half of our total goods trade deficit.

When you look at the numbers, you might say, “Damn, it looks like China is intentionally beating up the U.S., shipping us its exports (toys, clothing, refrigerators, electronics, TVs, cell phones, etc.). Either they have focused on the U.S. or we’ve been totally negligent in not producing the things we should have been making but did not.

Why has there been this imbalance for so long?

Economics. Fifteen years ago, Chinese wages were about 3% of the U.S. level. Which means it costs substantially less to produce there. Also the Chinese government was very flexible to support investment by domestic and foreign firms. At the same time, the U.S. has set itself up as the dumping ground for imports by having a currency that is 20% overvalued and no value added tax.

We seem to be at a standstill in terms of a long-term resolution.

Trump is looking at that same data and has every right to bitch and say, ‘This isn’t fair and we have to fix this.’ I support his efforts in this regard, but I would have been much more focused on getting the allies on board; I would have negotiated with China in private before- hand and given them a chance to agree “voluntarily” instead of beating them up in public, because if they agree to anything now they’re losing face—and the Chinese don’t like to lose face.

Some of the companies that import from China began stockpiling inventories in advance of the tariffs with the fear a second round of tariffs would be forthcoming. This goes against the grain of the flooring industry model, which primarily functions on a “just-in-time inventory system.” What happens if there are no additional tariffs?

If it goes to 25%, you will have the inventory. But if it doesn’t you’ll want to get rid of it as fast as you can. Sounds like a good time for me to negotiate for flooring for my condo.

In the flooring industry, many companies that were primarily sourcing from China have partnered with manufacturers in other Asian countries in the wake of the tariffs. Are you seeing this across other sectors?

There has been a series of articles about work flooding out of China, with most of it going to Southeast Asia to places like Vietnam, Cambodia, Indonesia, Malaysia, India.

Is it just a matter of time, then, before Vietnam becomes the new China and we’re dealing with the same issues?

That’s unlikely. Vietnam has about 96 million people compared to China’s population of 1.3 billion. Also, Chinese wages were rising 10-15% a year for the last 15-20 years. There are different dynamics in other parts of Southeast Asia. You don’t have to move too much work out of China to flood Vietnam with business. There are simply not enough workers in Vietnam to take the flood of work and not see the same wage growth patterns we’re seeing in China. So, five years from now, you might have to leave Vietnam. And by that time maybe Cambodia has gotten too expensive to produce. So now where do you go when that happens? India? (Has significant issues.) Africa? (I don’t see that.) Why go through a cycle like that every five years? Instead, we suggest U.S. companies do the math and find out the savings they will realize by coming back to the U.S.

But with high wages in the U.S., it’s not really cheaper to make products in the States.

It’s not that the U.S. is the best place in general to produce, but it is, in many cases, the best place to make products that are going to be sold here in the U.S. market. For example, U.S. companies are much more competitive selling flooring in the U.S. than they would be exporting to China, Germany, etc., because they don’t have to deal with duties, freight charges, inventory and so forth. U.S. manufacturing can be 15% more expensive than Chinese and still be the better choice for supplying the U.S. market.

Part of the challenge for companies that import is the high value of the U.S. dollar compared to other currencies. How do we address this issue?

We calculate that for every 1% improvement in U.S. suppliers’ costs vs. manufacturing off-shore, about 150,000 manufacturing jobs come back to the U.S. One of the simplest ways of achieving that is to bring down the value of the dollar. There’s a program called the Market Access Charge, which would charge anyone who wants to store money here—not to buy companies or hire people—a quarter percent to move the money into the U.S. That would motivate companies to move their money to Germany, Switzerland or maybe China, for example, which would lower the value of the dollar and raise the value of those other currencies. That, in turn, would make us more competitive. It would also make the U.S. a better place to build a factory—even if it doesn’t make us as good a place to be a bank. But the fact is, we need factories more than we need additional banks.

Interest rates play a role in that equation as well.

Lower interest rates are good for investment, and they’re also good for keeping the value of the dollar down. With a higher dollar value, U.S. bonds pay a higher amount and people think the dollar is going to keep going higher and higher. Then, billions of offshore dollars flood into the U.S. to get the higher interest rate and appreciation, and that keeps the cost of manufacturing in the U.S. uncompetitive vs. the rest of the world. One way to get the dollar down is to get the interest rates down again.

 

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Cork, bamboo intros sport new looks, sizes

April 29/May 6, 2019: Volume 34, Issue 24

By Megan Salzano

 

Cork and bamboo flooring options are the go-to eco-friendly options for consumers who deem sustainability an important part of their buying decision. Both categories fit well into the overall green story, and manufacturers agree they should be marketed as such. However, the product categories have also undergone a recent evolution with new technologies allowing for on-trend visuals and sizes sure to captivate consumers.

Following are recent product introductions that boast trending design features.

Amorim
Amorim’s Wise marks the first generation of flooring with an Amorim identity. Wise features a rigid core made of cork and recycled materials. The product was launched in a collection of 62 cork and wood visuals. It is PVC-free with all the benefits of a low thickness waterproof solution. The reinforced dimensional stability means it requires minimum subfloor preparation. Wise can be installed in both residential and commercial spaces alike.

 

Bamboo Hardwoods
The Symphony collection is a rigid core SPC with a strand-woven bamboo wear layer. It measures 5 inches wide, 72 inches long and 1⁄4 of an inch thick and features a 1.2mm wear layer. It can be glued down or installed as a floating floor. It is water resistant and withstands up to 72 hours of topical water spills.

 

Cali Bamboo
Nine new floors are now available in the company’s Eco-Engineered bamboo flooring collection. The new floors are the company’s first wide-plank engineered flooring styles with click-lock milling, ideal for gluedown or floating installations. Planks measure 72 7⁄8 inches long, 5 5⁄16 inches wide and 9⁄16 of an inch thick. The new styles feature an extra thick wear layer of fossilized bamboo over a sustainable core of cross-constructed eucalyptus. Planks are protected by a 13-coat durability sealing system, shielding them from pet claws, high heels and other forms of wear and tear.

 

USFloors
Natural Bamboo’s Muse Strand is ideal for homes located in a wide range of climates. The engineered locking construction pro- vides extreme dimensional stability. Muse Strand’s design features distressed and chiseled surfaces, hand-sculpted scraping and wire-brushed enhanced grains and fashion-forward stains and washes. The 5-inch and 5 1⁄2-inch planks are designed to add tailored sophistication while the 2 1⁄2-inch strip conveys a retro look.

 

Torlys
CorkWood Designer is designed to emphasize the true essence and beauty of hardwood. The line, which is FSC certified, features extra-long and wide planks in contemporary, on-trend colors. It includes a 3mm top layer, a polyurethane finish said to be equivalent to top-rated AC4 laminate, sealed edges for increased water resistance and CorkPlus attached underlayment with Microban antimicrobial protection.

 

WE Cork
The Timeless collection is a glueless floating floor system with traditional and unique shades and patterns. It is available in tiles or planks with a micro-bevel profile and comes with Unilin locking system. Timeless tiles and planks are finished with Greenshield and are suitable for light commercial or residential use. Tiles measure 24 x 17 1⁄2 x 7⁄16. Planks measure 35 1⁄2 x 7 1⁄2 x 7⁄16.

 

Wellmade Performance Flooring
Wellmade HDPC waterproof bamboo couples the performance virtues of rigid core flooring technology with real bamboo wear layer veneers. The product features Wellmade’s HDPC waterproof technology, a moisture protection system that seals out both topical and sub-surface moisture while boasting a 100% waterproof HDPC core. With attached pad, the bamboo flooring is 8.3mm thick x 7.48 inches wide x 72.83 inches long and features the Uniclic locking system. Colors range from traditional carbonized to multi-color and character-driven glazing options.

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Cali Brands grows, evolves, disrupts

January 7/14, 2019: Volume 34, Issue 16

By Steven Feldman

 

San Diego—Cali Brands, the company formerly known as Cali Bamboo, is growing faster than a weed after a rain shower on a sunny day. The company continues to evolve its product portfolio, adding vinyl, rigid core wood and engineered European hardwood to the mix while staying true to its sustainability mission and “green to the core’’ roots.

Bamboo is still an important part of the business, according to Doug Jackson, president and CEO. “We grew 40% last year with Cali Bamboo and Cali Vinyl. We have no interest in losing that business. We’re the largest importer of bamboo in the country, more than Home Depot, Lumber Liquidators, Floor & Décor, etc. People don’t realize that about us because we’ve got a wide reach across an omnichannel platform.”

Constantly appearing on Inc. magazine’s “5000 Fastest Growing Private Companies” listing (2018 was its 10th consecutive year as it checked in at No. 2370), Cali now boasts sales well north of $100 million and in 2018 increased its sales into the specialty retail channel sevenfold—quite impressive given its selective distribution strategy.

“We have about 1,100 actively purchasing dealers,” Jackson said. “In a perfect world we’ll have around 1,000 in the right 1,000 marketplaces that have the ability to make money with our products and allow us to drive those end users into their stores. We’re looking for the cream of the crop—close partners who want and are able to grow with us.”

With 30 years in the business under his belt, Jackson knows the “right people,” many of whom are in the National Floorcovering Alliance, to which Cali became a core vendor in 2018. “We gave them a handful of exclusives, and they will have a year to see if that works for them,” he said.

As the company evolves, it seems more retailers are interested in taking on Cali than Cali is in taking on retailers. In fact, it doesn’t seek too much exposure. “We’re not going to be on the show floor at Surfaces,” he said. “We’re going to call people up, go see them, catch up with them, find out if we’re a good fit, and if we are we’ll move forward. So far everybody we’ve talked to has gladly taken us on.”

In illustration, at the last NFA meeting in Napa, Calif., Cali was showing its brand spanking new Meritage collection, its first foray into the long and wide French oak hardwood arena pioneered by companies like DuChâteau. The line is aggressively priced at a price point where the retailer can make a healthy margin.

“Companies like DuChâteau, Provenza and Urbanfloor are doing a good job here offering a similar product where the consumer may pay $20,” Jackson said. “But a dealer might make 20% or 30% if they’re lucky because everybody in town can get it. We’re going to sell our 800 to 1,000 dealers and be happy about it.” The line debuts in the first quarter in eight SKUs that are 9½ inches wide, 72 inches long on a sustainable acacia core.

 

A fresh approach
Jackson uses the word “disruptive” to describe Cali’s approach. “We’re going to come in and say we only sell [Retailer X] in a particular area. They can make a great margin and a consumer can’t shop it. If they want to call us direct, fine, but we’re going to sell it for the same price. It’s much like that Apple phone. It doesn’t matter where you buy it, it’s just what level of service you want. Most folks would not know how to put this floor down. Ultimately, they are going to say, ‘Who is going to move my furniture? Who is going to measure? Who is going to install it?’ Buy from us and we will put it on your doorstep but we’re not going to lay it down. That’s where we get a chance to refer that consumer to our dealer partners. And for a product like this, nine out of 10 times she is going to say she needs someone local to measure, move the furniture, put it down, all those things.”

Another new product for Cali Hardwood this year is Odyssey, an engineered hardwood collection in European oak, American maple and American hickory. The line launches in 5½- and 7½-inch widths and 11 colors on an engineered, plantation birch foundation, illustrating Cali’s commitment to remaining “green to the core.” Plantation birch is grown with the intention of being cut. It’s a fast-growing, renewable, sustainable tree. The birch comprises more than 80% of the product, topped by a 2mm veneer that’s sourced from responsibly managed forests.

Cali Hardwood is also launching the second generation of GeoWood, its revolutionary engineered hardwood layering real timber over GeoCore, a flexible and waterproof limestone composite. The first generation, launched last year, was a 3-foot plank in bamboo, “which was really who we were as a company,” said Alex Brodkin, Cali’s new product introduction manager. “But we wanted to make sure the next generation really matched where we’re going.”

GeoWood 2.0 is a 6-foot-long, 5-inch-wide plank with a 1.2mm real oak veneer and comes with an attached 2mm pad. The pad helps with noise mitigation, one of the issues surrounding some SPCs. “For a DIY consumer who has done a vinyl install this is only marginally more challenging,” said Mike Belprez, director of innovation/product management. As an added advantage, the core of the product is coordinated to the wood. “So if you ever dent, ding, or scratch the surface and expose a bit of the SPC core, it will not stand out.”

Last but not least, Cali is taking its sustainability story to area rugs. “We all know when someone buys a wood floor, within a month on goes a rug,” Jackson said. “We’ve got that covered, too, with 100% sustainable rugs shipped directly to your house.” The rugs are handwoven from natural jute fiber, wool and upcycled denim and cotton.

“If you look at what we are doing and where we are going, it is all about options,” Jackson stated. “We talk to consumers every day to determine the best floor for their lifestyle. Where do we fit into their world? You can go vinyl, waterproof wood flooring or take a step up and have the best-looking woods on the market. We ask how long they plan to keep the house, what their cost expectations are, etc. We are going to provide a range of options for her lifestyle and budget.”

Five years from now, Jackson admitted the product mix might be different, but wouldn’t venture a guess as to how. “As we evolve the consumer is going to determine our product mix. I’d love to say my perfect plan is to be 50% this or 60% that, but because we’re asset light, we’re going to deliver what the market wants. You see what’s happening with WPC and rigid core. That can continue to grow strong or it could take a shift. We saw what happened with laminate. What we do know is we want to be mid to high end, we want to be affordably elegant, and we want to find voids in the marketplace where other people won’t, or can’t, make the products we can deliver.”

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Cork: Latest visuals push the design envelope

August 20/27, 2018: Volume 34, Issue 5

By Mara Bollettieri

As a natural, renewable material, cork has inherent benefits that appeal to a designer’s visual, practical and environmental senses—a virtual trifecta. But it is perhaps on the first attribute that suppliers have made the greatest strides. Thanks to the advent of digital screening and printing technology, manufacturers can push the proverbial envelope even further by broadening cork’s ever-expanding design possibilities.

Following are some examples of the latest looks available in cork flooring:

Cali Bamboo

It’s no accident that Cali Bamboo’s environmentally friendly lineup of hard surface flooring products also contains trendy, visually appealing cork flooring. These include popular wood looks in the trending wider/longer format.

“Average customers who go into a dealer to buy their floor want a well-performing, functioning, engineered product, but they’re primarily driven by the visual of that floor,” said Pallavi Adyanthaya, new product introduction program manager. “We’ve been able to take all that information and are constantly looking to evolve to keep up with the design/visual side of it.”

To that end, Cali Bamboo’s GreenClaimed cork series features oak-inspired visuals attached to an MDF core, which is supported by a strong backing layer. “We created this line for people who love cork for everything it provides from a functional standpoint but who aren’t fans of the look itself.”

Globus Cork

Globus Cork only uses 100% cork products and doesn’t alter the natural texture of cork in its tiles. Instead, the company focuses on color. “We are not trying to make it look like wood or ceramic tile,” said Jennifer Biscoe, COO. “We offer more than 45 different colors, and we do custom colors. We utilize a water-based staining process, which is extremely eco-friendly. Our flooring still looks like a cork product.”

Globus Cork also looks to differentiate by offering different shapes. “It’s not just squares and rectangles, it’s also hexagons and triangles,” Biscoe explained. “Our website shows about 35 pattern ideas, so utilizing the different shape options gives the consumer a huge range of choices. Then she can pick the tile color, size, shape and texture. Customers get to design whatever they like.”

Harris Wood  

Some manufacturers offer cork flooring products that incorporate attributes of other categories. For instance, Harris Wood Floors’ Luxury Vinyl Core series has a cork core that performs more like enhanced vinyl. “All the vinyl out in the marketplace today is waterproof,” said Renee Tester, senior product and marketing manager, Harris Wood Floors. “With ours, you get that beautiful look of a waterproof wood floor, but with all the benefits of a cork floor along with the durability that a vinyl floor has to offer.”

USFloors

While some manufacturers look to leverage cork’s natural looks, others seek to add a little visual punch to generate interest. Case in point is USFloors’ Natural Cork line, which offers cork planks and tiles in larger formats to keep in trend with what’s hot. And according to Philippe Erramuzpe, COO, the company has been expanding its offering of traditional cork decors, which is produced by layering bark pieces and cork granules. This is featured in its Traditional Cork Plank floor.

“Cork floors have been around for over a century,” Erramuzpe said. “Because cork flooring offers a unique combination of properties that no other floor covering can match, it’s the perfect choice for the end user looking for a soothing interior finish.”

The company’s Natural Cork line also offers digitally enhanced visuals featuring replications of stone and wood. “Cork composite sheets are now digitally printed with stone and wood visuals,” Erramuzpe explained. “Cork visuals, while beautiful, always had limited appeal. But technology has enabled the creation of decors that have more mainstream acceptance.”

Torlys

Digital printing on cork gives the visuals the consumer is generally looking for in her home. With this technological advancement, suppliers like Torlys are able to mimic other materials, such as wood or stone.

“We take real wood photography and then we do a design element to remove imperfections and make sure that whatever we do replicates real wood,” said Brian Gencher, vice president of marketing. “Due to the digital process we employ, we can have a cork floor that offers the natural variations of wood. In short, it has all the features and benefits of cork, but it looks like wood.”

WE Cork

WE Cork seeks to leverage digital printing to its advantage by customizing cork products for its clients. This is a great way for a restaurant, corporation or retailer to represent their brand, according to Ann Wicander, president.

Wicander said the company uses a multi-pass, high-definition print system, which creates an optic quality. This is used in its Serenity collection, which is its digitally printed cork line. The company also uses texture in the print, which gives the floor a three-dimensional feel.

“With technology improving, the natural attributes of cork are constantly evolving visually and technically to provide a flooring choice unmatched by any other,” Wicander explained.

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Latest bamboo, cork intros stir visual interest

April 2/9, 2018: Volume 33, Issue 21

By Lindsay Baillie

 

Touting qualities such as durability, comfort underfoot and water resistance, cork and bamboo products provide the industry with eco-friendly flooring suitable for both residential and commercial applications.

Following is an overview of some of the newest cork and bamboo innovations that promise to captivate consumers not only with updated visuals, but also with reasonable price points.

Bamboo Hardwoods

Bamboo Hardwoods’ new Symphony line features a hybrid of rigid core with a natural strand woven bamboo wear layer. The line combines the natural beauty of authentic bamboo floors with a waterproof rigid core allowing for installations in even the most undesirable locations.

Symphony is available in 72 x 51⁄8 x 9⁄32 planks and features a four-sided Uniclic locking system. Its 1.2mm strand woven bamboo veneer is wire brushed and stained. Symphony will be available in June in two colors: anise and currant.

Torlys

CorkWood brings together the look of wood, the durability of laminate and the comfort of cork. It comes in two collections: CorkWood Designer, which features 6-foot planks in nine colors, and CorkWood Elite, available in planks spanning nearly 4-feet long and five colors. CorkWood is engineered with a HDF smart core for dent resistance and a 3mm (Designer) or 2.5mm (Elite) thick top layer of compressed cork. It also includes the Torlys CorkPlus attached underlayment for added warmth and sound insulation.


WE Cork

WE Cork’s Corkoleum is a 3mm rolled cork flooring with a rubber and cork base and a cork veneer. Ideal for glue-down applications, Corkoleum is a very low, thin product. Made up of mainly cork, the flooring is marketed as being quiet, comfortable, warm and water resistant. Corkoleum is ideal for wet areas in both residential and commercial settings.

Also from WE Cork is a line of wall panels available for both residential and commercial applications. Available in two different visuals—brick, which comes in three different colors, and bark—WE Cork’s line of wall panels can be used for decorative purposes as well as a sound insulator.

Wellmade

Wellmade unveils a variety of new bamboo looks as part of its Opti-Wood flooring collection. Opti-Wood couples the performance virtues of rigid core flooring technology with real bamboo or hardwood wear layer veneers. The product features Wellmade’s Hydri-HDPC technology, a moisture protection system that seals out topical moisture and boasts a 100% waterproof HDPC core.

Wellmade’s new bamboo flooring is just over 5 inches wide, 48-plus inches long and 8.5mm thick, and features the Uniclic locking system. Colors range from traditional carbonized to multi-color and character-driven glazing options.

Cali Bamboo

Cali Bamboo has launched GeoWood, an engineered hardwood floor combining real timber layered over GeoCore—Cali’s stabilizing limestone composite foundation. The design layer atop each GeoWood plank is up to 1.2mm thick and features sustainably farmed bamboo and lumber from Lacey Act-compliant managed forests.

Made with AquaDefy technology, GeoWood boasts proven moisture protection, making it ideal for bathrooms, kitchens and below-grade spaces such as basements. Shielded by a 10-coat scratch resistant finish, GeoWood is ideal for spaces with heavy traffic, large dogs and the wear and tear of everyday life.

USFloors

USFloors’ current Cork Canvas collection is a digitally enhanced cork floor that features travertine decors. Digitally enhanced cork floors provide the beauty, depth and texture consumers expect in a natural stone or hardwood floor while maintaining the advantages of cork.

This flooring uses digital print technology to capture the colors, nuances, grains and textures of real stone and hardwood. These visuals are printed directly on a cork top layer, which is applied to an HDF core. A durable, embossed hot coat finish is applied to the cork top layer, while additional cork is added as an attached underlayment.

Wicanders

Wicanders Cork GO is a budget-friendly floating floor made with the company’s cork double layer. The collection comes in 10 cork visuals and contains all the signature Corktech benefits found in Wicanders’ products. Cork GO acts as a noise buffer between the floor and the rooms underneath and reduces walking sound up to 53%. The floor also acts as natural thermal insulation.

Cork GO provides a unique comfort in movement, even when walking barefoot. It also has a longer life span due to its elasticity, compressibility and ability to absorb high shocks

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Cork: Retailers position product as environmental option

August 14/21: Volume 32, Issue 5

By Lindsay Baillie

 

Screen Shot 2017-08-22 at 4.20.00 PMCork continues to present itself as an environmentally friendly product with a multitude of benefits and performance characteristics. In addition to being a “green” product, cork provides warmth and comfort underfoot, sound and noise reduction as well as long-term performance. The product’s green story is especially important for retailers looking to position cork as an alternative to other types of flooring.

Where retailers position cork in the showroom varies depending on certain factors including the store’s location and consumer demand. Overall retailers suggest there is no one place for cork; however, they agree selling the product requires it to have significant presence in the showroom.

Linoleum city in Hollywood, Calif., displays cork in multiple places around its showroom. “We have our cork displays set up next to the hardwood, bamboo and linoleum,” said Patricia Walters, sales and office manager. “We figured the best way to feature it is as a natural, sustainable product. We also stock some cork in our store and we have laid cork floors next to the cork displays. We also have an office in our store with cork flooring to show how well it wears in a light commercial application.”

Green Home Solutions in Seattle showcases cork in two separate spaces. “When you walk into our showroom the first floor you walk on is cork,” said Cameron Reith, a partner. “We actually use that as an example to show how durable it can be for commercial traffic. We [also] have a whole section for cork and its about 15-20 feet long.”

MicMar Wood Flooring & Design in Phoenix also displays cork at the main entrance of its showroom. The idea, according to Lenny Blier, sales representative, is to bring “it to our customers’ attention who might not know about cork flooring and its multitude of great qualities.” In addition, the dealer showcases cork on a large wall in the showroom behind some of its cork displays.

For many dealers cork is positioned near other hard surface offerings. Case in point is America’s Carpet Outlet in State College, Pa. “Cork is positioned in its own area in our showroom—near to the sheet vinyl, laminate and the wood displays,” said George McMurtry, owner. “We feel it is a unique and separate product line and should not be integrated into another flooring type or display.”

For Long Leaf Lumber of Cambridge, Mass., cork pairs well with the company’s already established wood business. “It sort of complemented what we did—everything we make is solid wood flooring,” said Alice DeGennaro, owner. “We thought it could be an option for someone looking for a prefinished product.”

Cork’s renewable qualities and easy installation make it an easy product to sell, DeGennaro added.

Emphasizing the attributes
A flooring store’s success with cork is dependent not only on its presence in the showroom, but also how retailers position the product to customers. For many dealers the consumer does not always come in the store looking for cork, which makes its product story and characteristics even more important.

“We feature cork as natural and sustainable flooring,” Walters explained. “The fact that it is sound absorbing and insulating also helps when selling to a customer in a high-rise condo. The green factor is the main selling point. Depending on the brand and construction of the cork, we offer it as a residential to light commercial product.”

Screen Shot 2017-08-22 at 4.20.12 PMThe Vertical Connection Carpet One in Columbia, Md., also utilizes cork’s green story. “As many do, we position it as an environmentally friendly product that has lots of great attributes including softness under foot, warmth and acoustical benefits,” said Adam Joss, co-owner. Joss’ flooring store positions cork at the front of its showroom to help spark conversations about the product’s unique characteristics.

In certain areas consumers are seeking out cork. Retailers say that those looking for the product have usually already done their research online and are interested in its sustainable properties.

“Typically it’s a very small segment of the population that is going to be interested in cork and it’s typically someone who has done research on environmentally friendly products,” said Scott Gaulden, general manager, Designer Showroom of Texas, Austin. “When they come in asking those [types of] questions we take them over to the cork display.”

McMurtry explained customers will occasionally ask for cork if they have looked at sites such as HGTV, Houzz, Better Home and Gardens, etc. The product is often viewed as a trendier flooring option. “We generally will offer cork to the customer as an alternative to other hard-surface products,” he added.

Most, if not all, specialty retailers agree that their main concern is educating the consumer about flooring regardless of whether or not she comes into a store looking for cork. And while it doesn’t happen all of the time, cork—in certain situations—still presents itself as the most viable option.

“Ultimately, all we’re trying to do is help [the consumer] navigate toward what is going to be the best floor,” Reith explained. “We are here to educate the consumer. A lot of the time [with cork] it can be a cost-saving choice.”

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Cork: Retailers position product as environmental option

August 14/21: Volume 32, Issue 5

By Lindsay Baillie

 

Screen Shot 2017-08-22 at 4.20.00 PMCork continues to present itself as an environmentally friendly product with a multitude of benefits and performance characteristics. In addition to being a “green” product, cork provides warmth and comfort underfoot, sound and noise reduction as well as long-term performance. The product’s green story is especially important for retailers looking to position cork as an alternative to other types of flooring.

Where retailers position cork in the showroom varies depending on certain factors including the store’s location and consumer demand. Overall retailers suggest there is no one place for cork; however, they agree selling the product requires it to have significant presence in the showroom.

Linoleum city in Hollywood, Calif., displays cork in multiple places around its showroom. “We have our cork displays set up next to the hardwood, bamboo and linoleum,” said Patricia Walters, sales and office manager. “We figured the best way to feature it is as a natural, sustainable product. We also stock some cork in our store and we have laid cork floors next to the cork displays. We also have an office in our store with cork flooring to show how well it wears in a light commercial application.”

Green Home Solutions in Seattle showcases cork in two separate spaces. “When you walk into our showroom the first floor you walk on is cork,” said Cameron Reith, a partner. “We actually use that as an example to show how durable it can be for commercial traffic. We [also] have a whole section for cork and its about 15-20 feet long.”

MicMar Wood Flooring & Design in Phoenix also displays cork at the main entrance of its showroom. The idea, according to Lenny Blier, sales representative, is to bring “it to our customers’ attention who might not know about cork flooring and its multitude of great qualities.” In addition, the dealer showcases cork on a large wall in the showroom behind some of its cork displays.

For many dealers cork is positioned near other hard surface offerings. Case in point is America’s Carpet Outlet in State College, Pa. “Cork is positioned in its own area in our showroom—near to the sheet vinyl, laminate and the wood displays,” said George McMurtry, owner. “We feel it is a unique and separate product line and should not be integrated into another flooring type or display.”

For Long Leaf Lumber of Cambridge, Mass., cork pairs well with the company’s already established wood business. “It sort of complemented what we did—everything we make is solid wood flooring,” said Alice DeGennaro, owner. “We thought it could be an option for someone looking for a prefinished product.”

Cork’s renewable qualities and easy installation make it an easy product to sell, DeGennaro added.

Emphasizing the attributes
A flooring store’s success with cork is dependent not only on its presence in the showroom, but also how retailers position the product to customers. For many dealers the consumer does not always come in the store looking for cork, which makes its product story and characteristics even more important.

“We feature cork as natural and sustainable flooring,” Walters explained. “The fact that it is sound absorbing and insulating also helps when selling to a customer in a high-rise condo. The green factor is the main selling point. Depending on the brand and construction of the cork, we offer it as a residential to light commercial product.”

Screen Shot 2017-08-22 at 4.20.12 PMThe Vertical Connection Carpet One in Columbia, Md., also utilizes cork’s green story. “As many do, we position it as an environmentally friendly product that has lots of great attributes including softness under foot, warmth and acoustical benefits,” said Adam Joss, co-owner. Joss’ flooring store positions cork at the front of its showroom to help spark conversations about the product’s unique characteristics.

In certain areas consumers are seeking out cork. Retailers say that those looking for the product have usually already done their research online and are interested in its sustainable properties.

“Typically it’s a very small segment of the population that is going to be interested in cork and it’s typically someone who has done research on environmentally friendly products,” said Scott Gaulden, general manager, Designer Showroom of Texas, Austin. “When they come in asking those [types of] questions we take them over to the cork display.”

McMurtry explained customers will occasionally ask for cork if they have looked at sites such as HGTV, Houzz, Better Home and Gardens, etc. The product is often viewed as a trendier flooring option. “We generally will offer cork to the customer as an alternative to other hard-surface products,” he added.

Most, if not all, specialty retailers agree that their main concern is educating the consumer about flooring regardless of whether or not she comes into a store looking for cork. And while it doesn’t happen all of the time, cork—in certain situations—still presents itself as the most viable option.

“Ultimately, all we’re trying to do is help [the consumer] navigate toward what is going to be the best floor,” Reith explained. “We are here to educate the consumer. A lot of the time [with cork] it can be a cost-saving choice.”

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Scoring flooring: Industry stats for 2016

June 26: Volume 32, Issue 1

 

Screen Shot 2017-07-05 at 9.05.12 AMThe flooring industry in 2016 continued its recovery from The Great Recession. While growth rates pale in comparison to the mid-2000s heydays, the industry last year continued to post steady gains across the board with increases of 5.1% in dollars and 3.8% in volume. This comes on the heels of 4.4% growth in dollars and 3.2% in volume in 2015; 3.6% growth in dollars and 1.8% in volume in 2014 and respective 5.5% and 3.8% growth in 2013. In fact, 2016’s figures represent the seventh consecutive year of dollar growth and fifth straight year of volume increases.

FCNews’ exclusive research reveals total 2016 flooring sales of $21.174 billion and 19.13 billion square feet. (These numbers are in wholesale dollars reflecting the first point of sale.) While the industry remains far off the peak it reached in 2006, when sales of $24.175 billion and 26.36 billion square feet (down 12.4% and 27.4%, respectively) were posted, it has gained back much of what was lost. The low point for the industry was 2009, when sales bottomed out at $16.189 billion and 16.625 billion square feet (in 2010). Since that time, the industry is up nearly 31% in dollars and 15% in volume.

Perhaps more significant is total industry sales surpassed the $21 billion mark for the first time since 2007, when sales were $22.337 billion, and volume is at its highest level since 2008’s 19.905 billion square feet.

Also of note is the fact dollars are growing faster than volume. That is a reflection of consumers buying more expensive goods in addition to a series of price hikes, particularly on the carpet and hardwood sides. The average selling price of all flooring in 2016 was $1.11 (same as 2015) and up $0.02 from 2014 and up $0.04 from 2013). Just to compare, the average selling price of all flooring in 2006 was $0.94. One needs only to look at the resilient category for an explanation. Ten years ago the average selling price for all resilient flooring was $0.64. In 2016 it was $1.04. A decade ago, sheet vinyl, vinyl composition tile (VCT) and the low-cost, peel-and-stick tile commanded 75% of dollars. Last year that number plummeted to 33%. The increased usage of the higher-cost LVT and WPC has been an industry game changer.

But it’s not just resilient. The average ceramic tile price has increased from $0.95 to $1.20 a square foot over the last 10 years, and hardwood has seen an average-square-price jump from $2.21 to $2.48 per square foot. Even the maligned soft surface segment—which has seen its share of the market dip from 63.6% in 2006 to 53.6% in 2016—has seen an increase in average pricing from $0.89 to $1.01. For the record, laminate is the only category with pricing in decline, going from $1.30 a square foot in 2006 to $1.09 in 2016.

Why has the growth been slow and steady and not more robust? For one, housing has not led the recovery from the recession and is actually lagging the economy. Also, in past recoveries there has always been a period of strong economic growth before it settles into normal growth mode. That has not happened with this recovery.

(Editor’s note: FCNews does not include stone flooring in its aggregate total, nor does it account for ceramic wall tile. In addition, rubber flooring numbers now reflect solely sheet and tile flooring with no accessories or cove base.)

Much like the past few years, the resilient category continues to be the locomotive powering the industry and luxury vinyl tile/WPC the catalyst for this explosive growth. In 2016, resilient posted the largest percentage gain of any flooring category, rising 19.7% to $3.499 billion from $2.924 billion in 2014. Since 2010, the category has increased a stunning 103% and is now at its highest point in history in terms of dollars.

In the grand scheme of things, resilient now accounts for 16.5% of the total flooring market in dollars and 18.8% in volume after a 6.5% rise in units to 3.537 billion square feet. In 2015, resilient held a 13.3% market share in terms of dollars, which was up from 12.2% in 2014, 11.9% in 2013 and 11.2% in 2012. Interestingly, its market share in volume had stayed around 15% for eight consecutive years until leaping to 17% in 2015. That suggests resilient’s average price point has increased by virtue of the migration from felt to fiberglass sheet, along with the transition from residential/commercial sheet and vinyl composition tile (VCT) to LVT and WPC.

Screen Shot 2017-07-05 at 9.06.32 AMFCNews research reveals just how much LVT along with its subcategory, WPC/rigid core, is driving growth of the segment. Sales have gone from nearly $750 million in 2012 to $948 million in 2013, $1.142 billion in 2014, $1.651 billion in 2015 and $2.161 in 2016. That represents respective gains of 26.4%, 20.5%, 27.1% and 30.9%. More telling, LVT sales have more than doubled in three years. It also carries with it a premium price tag as it comprises 62.5% of the category’s dollars but only 38.4% of its volume. To illustrate its growth, those numbers were 53.2% and 33.6% in 2015; 47.7% and 26.4% in 2014; 43% and 22.3% in 2013; and 37.4% and 20.6%, respectively, in 2012.

LVT increased significantly in both residential and commercial markets—dollars and square feet—in 2016. Residential LVT saw a 68.3% increase in square footage from 760 million in 2015 to 1.04 billion (including WPC), making up 76.1% of the LVT market. This number was 71% a year ago and 55% two years ago. The big increase can be attributed to the WPC bandwagon, which, to this point, is almost exclusively residential. The commercial market rose from 297.2 million square feet to 326.3 million square feet, a 9.8% increase. While residential brought in more dollars—$1.512 billion—last year, commercial LVT still performed well, posting a 12.5% increase, rising from $576.4 million in 2015 to $648.6 million in ’16.

Proponents of the category say the versatility of LVT—tile or plank—makes it an ideal solution for any number of residential, commercial and project-oriented applications. This multi-tasking ability has allowed LVT to migrate into builder, multi-family and residential-remodeling applications. The large space in which LVT operates, in turn, has afforded manufacturers the means of introducing differentiated product across a wider front, ebbing the march toward commoditization.

Originally, LVT became popular as a water-resistant, hard surface product ideal for mainly kitchens and sometimes spaces such as a laundry room. In the past, LVT would not be considered for bedrooms or other larger living spaces throughout the home. However, this perception has changed in recent years.

As LVT grows, it is taking share from other resilient categories, especially VCT. But it is also nipping from sheet vinyl as well. Sheet vinyl—both residential and commercial—has grown only 2.4% in the last three years, going from $791 million in 2013 to $809.6 in 2016. It actually was down 0.5% from $813.5 million in 2015. Residential has led the way here, but if not for the rebound in new home construction and manufactured housing, sheet vinyl would surely be down. The commercial market has taken the bigger hit, declining 16% in dollars from $254.24 million in 2013 to $213.5 million in 2016. However, the category was only down slightly in 2016, 1.2% to be exact, on the heels of a 1.4% decline in 2015. Sheet remains the volume leader in residential resilient sales with 47% of the market, down from 55.1% in 2015 and 60.2% in 2014, but it comprises only 26.7% in dollars, down from 38.9% in 2015.

Carpet
If you are looking for a bright spot in an otherwise flat year for carpet, there was builder and multi-family, in which the carpet segments fared pretty well in 2016 vs. 2015, according to executives. However, with overall residential carpet dollars down a tick in 2016, executives say that points to a decline in the residential replacement carpet business—further evidence of carpet losing out to hard surface.

FCNews’ research shows that carpet sales fell 1% in 2016 to $8.7813 billion compared with $8.87 billion in 2015. However, total volume—which includes carpet and area rugs—gained 1.2% to 11.22 billion square feet from 11.09 billion square feet in 2015. Residential carpet sales declined an estimated 1.5% in 2016 while units were up 1.3%. The commercial portion of the pie, meanwhile, dropped 0.5% in sales with volume falling about 1.5% year over year.

The carpet story really hasn’t changed much in the last three years, except in 2016 commercial was softer than it had been in the previous two. Flat to a point up or two down is nothing to write home about, but it is a far cry from a decade ago when carpet was in the throes of a deep recession—as were other flooring segments—with double-digit losses in both sales and volume.

Executives say carpet is doing well at the low end, where polyester has been dominant. However, some note that PET is contributing to the shrinking dollars in carpet in what they see as a race to the bottom and, consequently, a devaluation of the category.

The high end ($14 and up) is said to be doing well, with soft luxury goods as well as stain and soil resistance resonating with consumers. Still, it is going to be a challenging road for carpet going forward. One leading executive said builders in the South and Southwest, which is seeing the greatest population growth, are constructing homes and apartments with much less carpet than in the past.

Screen Shot 2017-07-05 at 9.06.51 AMOn the bright side for soft surface is rugs, which for a third year in a row outperformed carpet, with sales rising an estimated 3% over 2015. The area rug business, observers say, is benefiting from hard surfaces; however, many specialty flooring dealers say they are not yet reaping the full benefit of these add-on sales in the same as way furniture stores and other outlets.

Hardwood
A strong residential replacement/remodel market, combined with improvement in certain sectors of the new construction market, contributed to another year of growth for the U.S. hardwood flooring category. FCNews research shows hardwood flooring sales reached $2.23 billion in 2016, a 5.1% increase over 2015’s upwardly revised sales of $2.12 billion. Square footage sold likewise grew to an estimated 898 million square feet, a 4.8% increase over 2015’s 857 million square feet.

Looking at the big picture, hardwood flooring represents 10.5% of total industry sales but only 4.7% of total volume. Compared to five years ago, wood represented 9.1% of total flooring dollars at the first point of sale and only 3.9% of total volume.

Industry observers attribute much of hardwood’s activity in 2016 to the growing popularity and production of engineered floors. While solid wood flooring still remains the go-to product in certain parts of the country, several suppliers have introduced engineered hardwood products that replicate the overall thickness of ¾-inch solid wood flooring. The end result is the traditional solid wood flooring end user—builders and contractors, in many cases—can now nail down an engineered floor in much the same way they would a solid product and still be able to sand and finish multiple times.

Right in line with the swing from engineered to solid is the move to prefinished from unfinished (traditional hardwood flooring contractors being the primary exception). FCNews research shows the share of prefinished products grew to nearly 60% last year—up from just 54% the year prior. Looking back five years ago, the ratio of prefinished to unfinished was just the opposite.

The U.S. hardwood flooring market also saw a bit of a shift with respect to domestic production vs. imports. FCNews research showed imports from Canada rose slightly from 9% to 12% in 2016. At the same time, shipments from Brazil dropped from 5.6% in 2015 to just over 3% in 2016. Although China—which ships more engineered than solid product—still accounts for the bulk of imported hardwood flooring, its share also fell slightly year over year.

Ceramic
The tile segment closely follows the overarching economic trends that impact all major spending. Those drivers include new housing starts, commercial market recovery, consumer confidence, credit availability and interest rate fluctuation. When those indices are positive, ceramic sales and volume follow suit. And so it was again in 2016, the seventh consecutive year of growth for ceramic, with sales rising 5.7% to $2.761 billion and volume increasing 5.9% to 2.31 billion units.

The seven-year winning streak followed a dark three-year period, during which time sales and volume plummeted an almost incomprehensible 20% or more each year, with 2009 representing the low point (24% decline in sales, 22.5% down in volume).

The trend since 2010 has been that single-family homes grow ever larger, and multi-family residences continue to shrink. Since ceramic tile represents a greater percentage of the flooring used in a single-family home than a multi-family property, this has had a positive impact on the category. In 2016, growth occurred in all segments; builder and overall commercial each rose an estimated 7%-10%, while retail—the laggard of the group—was still up an estimated 2%-4%.

Domestic production has been a big story in ceramic tile for the past few years, and 2016 saw several companies expand production or break ground on new plants. In March 2016, almost two years to the date that Dal-Tile’s $180 million, 1.8-million-square-foot facility was announced in Dickson, Tenn., the company’s first production run was completed, with large format 12 x 24 glazed porcelain tiles being produced.

Commercial activity was up in most sectors with growth seen in hospitality, healthcare, education and corporate spaces. Commercial projects and spending continued its upward trajectory as well.

The only discernable drag on ceramic tile is labor. Experts say growth was partially stunted due to continued labor issues in the marketplace. For the ceramic market to reach its full potential, more qualified tile installers are needed. As the flooring industry knows all too well, that is no small task.

For now, however, achieving mid- to high single-digit growth will have to suffice. Compared to the 2007-2009 crater, the industry will gladly take it.

Laminate
In 2015 the U.S. laminate industry began to see a significant drop-off in imports from China. At the same time, many European suppliers—particularly German laminate flooring producers—expanded production capacity to fill the void. Observers say that trend spilled over into 2016 where U.S. laminate flooring sales were estimated at $1.154 billion. Taking the pullback of Chinese product into account, that held growth to just a mere 1.5%—the lowest rate of increase of any hard surface category.

Volume-wise, the category grew at a rate of 2% to 1.054 billion square feet—a reflection of the rise in shipments from Germany plus the increased domestic capacity that came online toward the latter part of the year.

“Europe has shifted from 14% to 19% while China fell from 26% to 21%,” said Travis Bass, executive vice president, Swiss Krono, which puts the domestic/import split around 60/40, respectively. The company, which has production facilities around the globe—including here at home—says its share of the market grew to 12%.

Just as the mix of laminate sources has changed in recent years, so has the sales activity as defined by distribution channel. FCNews research shows the specialty retail sector accounts for roughly one-third of category sales. What’s more, observers say, many of the laminate flooring products sold at this channel represent thicker, higher-margin items not typically sold at the average home center or mass merchant. This includes 12mm and 14mm products vs. the thinner, entry-level boards available at many home centers and discount merchants. All this spells opportunity for the independent or aligned floor covering dealer.

The bigger story, though, was laminates’ decline in terms of the overall share of hard surface activity. In 2011, for example, laminate flooring represented 16.9% of all hard surface sales and a little over 14% in terms of volume; last year, the category’s percentage of hard surface sales slipped to 11.8% in value and 13.4% with respect to volume. Meanwhile, competing products such as resilient and ceramic tile grew their respective shares of the hard surface market over that time period.

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Cork: Product positioning is key to optimizing sales opportunities

August 22/29, 2016; Volume 31, Number 5

By Reginald Tucker

The benefits and performance attributes of cork are well documented: The product provides comfort underfoot, sound/noise reduction and impact resistance. Plus, its reputation as a renewable resource makes it an environmentally friendly product category. However, the product cannot sell itself; it requires product knowledge, creativity and a consultative sales approach. Following are some tips from cork manufacturers.

“The most successful dealers are the ones who are more educated about the product,” said Ann Wicander, president of WE Cork. The more RSAs know about cork, she said, the more they can recommend the product to fulfill a customer’s specific needs. “Those who have the most success selling cork are the ones who don’t wait for people to ask for the product; they offer cork as part of their repertoire as part of a solution.”

Screen Shot 2016-08-29 at 3.20.24 PMScreen Shot 2016-08-29 at 3.20.45 PMTo that end, Wicander advises RSAs to look for certain “clues” from shoppers when they walk into the store and ask about product attributes and how those features fit their design needs and functional requirements. “Whether consumers are looking specifically for wood, or if in conversation the shopper mentions that her kids have allergies, or if she is looking to replace the flooring in her kitchen and she’s worried about cold, uncomfortable floors—all those are clues for the salesperson to offer cork as a solution. RSAs who wait for consumers to ask for cork are only going to sell it a half dozen times a year and that’s it.”

Other cork experts recommend retailers position the product in close proximity to other “green” flooring options, namely bamboo. “We advise combining the cork and bamboo together because they are two renewable resources,” said Philippe Erramuzpe, COO of USFloors. “In order to facilitate this for the retailer, we put them in the same display, which we call Sustainable Living. This strategy appeals to the consumer who wants to save the world, so to speak.”

Product positioning is key, Erramuzpe notes, given the strong competition from other hard surfaces on the showroom floor. “The cork category is under a little bit of stress right now due to the fact that LVT specifically is taking more share. That’s because of the specific type of applications where cork used to be prevalent, namely kitchens, are increasingly using LVT; for some LVT is a better solution because it’s waterproof.”

In light of this trend, Erramuzpe suggests retailers expand the opportunities for cork by recommending it for areas beyond the kitchen. “The applications we are pushing today are playrooms for kids, a study in the home or even basements—as long as you insulate the floor from the subfloor by using a moisture barrier. We also see great opportunity in the bedroom because the trend is moving toward less and less carpet.”

Some manufacturers believe the most effective means of selling cork entails a consultative approach. Sometimes, however, this requires that salespeople shift their focus away from price. “I think it really comes down to retailers understanding their sales force,” said Zach Adams, director of U.S. operations, for Amorim, which makes the Hydrocork brand. “We advise retailers to talk about the features/benefits as they look to provide solutions for the customer. But they have to be trained in that regard.”

Part of that training, Adams said, is contingent upon how specific product lines are structured. “For example, in taking the consultative approach, I would put our Hydrocork and our cork visual lines together and then sell the customer on the underlying CorkTech technology. But if a retailer’s sales force is more reliant on the price and product differentiation, then I would separate the Hydrocork into the WPC/LVT areas and then put our cork visuals into the wood or specialty wood sections. It really all depends on how the retailers train their sales forces.”

This is where effective sales aids come in. Amorim, for instance, providers a two-page flyer and brochure that provides quick and simple benefits of CorkTech technology. It also provides a “demo board” that allows consumers to see hear and feel how cork differs from other categories. “This turns it into a more sensory type of sales approach,” Adams said. “When people hear how great a product is it becomes numb to them because everybody says their product is the greatest. The demo board delves specifically into CorkTech technology.”

Another option, experts say, is to complement wing displays with installed product underfoot right on the showroom floor. As WE Cork’s Wicander states: “When selling cork you’re primarily focusing on the features and benefits. Well, there’s no better way to convey that message than having a display floor down.”

Screen Shot 2016-08-29 at 3.20.56 PMSometimes space limitations won’t allow for that. “Seeing the floors laid out is always a good selling point, but it’s difficult in this day and age because a lot of times people don’t have the room in their stores to do that given all the products they are inundated with,” Adams said.

In those situations, experts advise strategic placement of sample boards on wing rack displays. “If you’re dealing with limited space on the floor, then the cork display needs to be near wood,” Wicander said. However, that might not work for everyone. “Technically—and categorically—cork really falls under the resilient heading. But it really identifies more with wood because, like wood, you’re going to care for it using the same maintenance methods and the price point is going to be closer to wood. Take our digitally printed Serenity Collection, for example; for the customer who likes the performance attributes of cork but not necessarily the natural cork visuals, this gives them a great solution because the [screen] visuals mimic natural wood.”

At the end of the day, experts say the best approach is to keep it simple. “If you can train your salespeople into becoming solution providers and fill the void in terms of what people need, that will deliver results,” Adams said. “Don’t inundate the customer with too many products and avoid lumping cork in with commodity type products.”

Perhaps the biggest incentive for salespeople to sell cork is to focus on the profit opportunity. “Cork is perceived by the general public to be a higher-end product that’s more expensive than today’s laminate and even LVT,” Erramuzpe explained. “Cork would be an upsell from the LVT category. Cork is certainly a category where the retailer can make a good margin.”

Quick facts about cork

Cork comes from the bark of the cork oak tree. It’s harvested by hand when the tree is 25 years old and occurs every nine years from then on leaving the tree undamaged and able to regrow new bark.

Cork is ideal in terms of the ever-increasing demand for conservation of natural resources. It has unique qualities and characteristics that make it suitable for both residential and commercial applications. It’s made of millions of cells resembling a honeycomb structure that protects the tree from sharp weather temperature changes. Each cell functions as a miniature natural thermal insulator and also provides above average sound insulation and shock-absorbing properties.

Through technological development and investments in innovation and research, new applications using cork are increasingly being discovered. Architects and designers are increasingly turning to natural and ecological materials and finding new discoveries and applications. This usage ranges from special effects in action films to high tech accessories in various industries.

 

 

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Power of brands: Flooring brands still pack a big punch

August 22/29, 2016; Volume 31, Number 5

By Ken Ryan

A flooring brand isn’t like an automobile moniker, at least not to the naked eye. Virtually every vehicle on the road is adorned with a logo or a name, or a distinct style that defines its make and model. With flooring, the average consumer may not know the brand of carpet or hardwood floor installed in her home.

But does that make the power and influence of a flooring brand any less important than a car brand? To many flooring dealers, brands definitely matter, especially when those brands are backed by people and companies that stand behind their products and programs.

Steve Weisberg, president of Crest Flooring in Allentown, Pa., said while some flooring manufacturers have tried to establish brand equity with consumers “without too much success, it is more important for me to sell the products of those manufacturers who support us with the right quality and service so we in turn know they have our backs.”

Elisabeth Stubbs, president of Floors & More in Marietta, Ga., said given the amount of online research consumers do today as part of their decision making process, consumers are likely to seek out manufacturers with good reputations. “Flooring is expensive and consumers do not want to make a mistake. A well-known established brand synonymous with quality gives the purchaser a sense of security they are making a smart investment in their home.”

Manufacturers aren’t the only ones with brand equity in flooring. Retailers have significant brand power in their own markets. For more than 20 years, The Flooring Gallery has served the Louisville, Ky., metro market, now with five stores. Nick Freadreacea, president of The Flooring Gallery, cited one trend that seems to have taken hold is the importance of the independent dealer to his market. “Many people have come to realize how important it is to do business with a local company that is involved within their community,” he explained. “This has also led to the proliferation of private labeling which has enabled the retailer to put together his own grouping of the best items at competitive pricing. This allows him to be profitable enough to give good service and stand behind what he sells. The private-label items become the retailers’ brand, and that will be the salesperson’s first choice when showing products. We all know the professional floor covering retail salesperson has the most control of what the consumer is ultimately offered, and she wants something that separates it from a big box store.”

 

HF Design: Quality and reputation that stand out from the pack

Screen Shot 2016-08-29 at 1.06.52 PMEstablishing a reputable, quality-driven brand that flooring distributors, dealers and homeowners can recognize is becoming increasingly important in today’s saturated marketplace. There are more import brokers trying to penetrate the market with unsustainable price points just to gain showroom space. Unfortunately, in many cases these brokers cut corners in terms of finish quality, substrate construction, production processes and even delivery. This is very evident when you compare samples side by side.

At HF Design, it is the company’s responsibility to make sure it conveys in its marketing message that the company is FloorScore certified, its raw materials are sourced from legally harvested forests, its plywood cores are CARB II compliant and that it uses the highest quality German finishes for long-lasting floors. More importantly, HF Design’s quality assurance team inspects every plank. Furthermore, by partnering with the best distributors in the industry, HF Design has been able to introduce the newest collections and styles at affordable prices that its retailers can then confidently sell to homeowners.

 

Mohawk: The power in the family of brands

Screen Shot 2016-08-29 at 1.06.58 PMMohawk enjoys global brand recognition as the world’s largest flooring manufacturer. With facilities and manufacturing operations across the nation, Mohawk is committed to American-made manufacturing and the communities and families it impacts on a daily basis. From product conception, to the manufacturing process, to the transportation of products, Mohawk employees are providing the foundations for homes and businesses around the world.

The power of a brand and its attributes is vastly important for infrequent purchase categories such as flooring. Strong branding gives consumers peace of mind, allowing them to feel confident about their investment. Retailers—both large and small—leverage the power of the Mohawk brand around the world each and every day.

Mohawk and its family of brands are among the most well-known in the flooring industry. These include: American Olean, Century, Columbia, Daltile, Durkan, IVC, Karastan, Lees, Marazzi, Mohawk Group, Mohawk Home, Pergo, Q-Wood and Quick-Step. The company’s vertically integrated manufacturing and distribution processes provide competitive advantages in the production of carpet, carpet tile, rugs, ceramic tile, laminate, hardwood, stone and luxury vinyl flooring. The enterprise-wide innovations yield products and technologies that are differentiated in the marketplace.

The organization invests heavily in the Mohawk brand by way of lead generation, advertising, digital marketing, public relations, merchandising, point-of-sale, innovative products and national promotions, just to name a few. These efforts result in high consumer recognition and increased profit margins for Mohawk’s retailers.

The primary reason Mohawk invests in its family of brands is to deliver qualified consumer leads to its valued retail partners. The current pace of change in flooring products and flooring retail requires new programs that give its retailers the inside track to stay ahead of the competition.

 

Scotchgard: The merits of a strong brand partnership

Screen Shot 2016-08-29 at 1.35.19 PMWith more than 65 years of proven innovation, market leadership and dedication to quality, Scotchgard has the protective products and brand strength to help make 3M’s partners successful. A brand partnership with Scotchgard Protector strengthens the value of the host brand and creates opportunities that can:

  • Increase edge over competition
  • Build brand equity in new markets
  • Increase sales
  • Grow market penetration
  • Expand credibility to both brands

The Scotchgard brand name has been synonymous with protection for multiple generations. Invented in the 1950s and protecting floors from their owners since the 1970s, Scotchgard Protector has become one of the leading brands of stain, spill and soil protection in markets around the world.

When companies have a history of selling products that are dependable, reliable and in line with consumer needs, consumers begin to develop trust in the product and loyalty to the brand. The real power in the Scotchgard brand is that it represents that one last thing consumers want when they purchase your product—peace of mind. It can close the sale.

 

Mirage: Nurturing a passion for quality

Screen Shot 2016-08-29 at 1.35.34 PMManufacturing and marketing superior quality products has always been Mirage’s No. 1 priority. Achieving and maintaining this high level of quality is both a daily challenge and a goal that each of the company’s employees strives to attain. Among all the attributes that define Mirage, the two traits it is best known for are quality and consistency.

The quality is not just in the product but also in the quality of service Mirage provides its distribution partners and, in turn, flooring dealers. It has to do with the dedication and knowledge of the people, from the worker in the plant to the sales representative in the field. Mirage’s employees pursue the same goal: Going above and beyond customer expectations and constantly adapting to their needs.

This is the foundation on which Mirage’s reputation is built. The numerous quality awards received in the last decade—29, to be exact—prove the company’s efforts are producing results. It doesn’t mean Mirage can stop either because of its success; after all, quality is a journey, not a destination. Quality has always been the power of the Mirage brand for over 30 years with no plans to slow down. The company’s tagline says it all: Quality without compromise.

 

Beaulieu America: Quality, innovation and commitment

Screen Shot 2016-08-29 at 1.35.48 PMSome people define a brand by its exterior elements: name, logo, tagline. At Beaulieu America, the true essence of the brand is how people feel about the products and services. Therefore, the company’s main goal is to provide its customers with products that have unique, proprietary features and benefits driven by their needs. Moreover, Beaulieu strives to be known for its personalized service and for customers to feel as though they are valued members of Beaulieu’s extended corporate family.

To keep the Beaulieu America brand as focused and efficient as ever, marketing efforts have recently been concentrated on the company’s name. In the years ahead, the marketing strategy will raise awareness about the brand in its entirety. The Beaulieu name has been around for almost 40 years, and the company has grown to become one of the largest flooring manufacturers. These facts should shine through marketing initiatives. Complementing its core carpet manufacturing business, Beaulieu distributes engineered hardwood, laminate, luxury vinyl, engineered luxury vinyl and carpet tiles. In addition, Beaulieu’s Your HomeStyle is an innovative aligned dealer program and selling system featuring four distinct lifestyles. By understanding the customers’ taste and personal style, retail sales associates can match the product collection to suit their needs.

Quality, innovation and commitment—strong words for strong brand names such as Beaulieu and Your HomeStyle.

 

Urban Floor: Creativity and design at a great value

Screen Shot 2016-08-29 at 1.36.02 PMUrban Floor is proud of the company it has become in its relatively short history. Now entering its 13th year, Urban Floor’s focus has been to offer innovative and trendsetting products, with its management team constantly searching for new trends, styles and ideas from across the globe.

Urban Floor’s goal is to be on the cutting edge with new styles and bring these products to its dealers. New products that are not widely seen in competitors’ stores allow Urban Floor dealers to enjoy much higher profit margins. Trendsetting products such as the Villa Caprisi and Composer collections set the standards for wide/long planks and continue to be strong sellers.

In addition to innovative styles, Urban Floor offers a full range of popular “standards” from entry-level birch all the way up to a reclaimed look, 11½-inch wide European oak. Three additional launches are planned for late 2016.

Urban Floor’s vision is for its brand to be recognized for innovative products and designs at competitive pricing without sacrificing quality and excellent customer service.

 

WE Cork: Five generations of style and new product development

Screen Shot 2016-08-29 at 1.36.14 PMWE Cork represents the fifth generation in the cork industry. During this time the company has navigated through many economic cycles and myriad changes while employing the latest technology to offer the market the highest quality product with innovative visual design and great service.

The WE Cork brand offers the consumer and retailer a piece of mind that it carries a product line that meet expectations in performance as demonstrated by WECU (WE Cork Underlayments) for thermal and sound insulation under hard surface and LVT. WECU has never had a failure since its introduction in 1978.

WE Cork brand assures the due diligence in R&D for new technology as shown in the Serenity Collection, the company’s high-definition printed cork flooring, which can be customized for both residential and commercial applications. Furthermore, WE Cork service provides a live voice on the phone and technical answers within minutes. It’s all about providing the high quality and customer service associated with a strong brand.

 

HPS Schönox: A brand is best built in person

Screen Shot 2016-08-29 at 2.31.28 PMLate last year HPS Schönox announced the opening of its national support center in Florence, Ala. Customers from around the country have used the center for meetings, seminars and hands-on-training sessions.

“All the advertising and marketing we do is important, but nothing replaces the value of face-to-face conversations like those we have at the center,” said Thomas Trissl, principal, HPS Schönox. “Building a brand is tied directly to those personal interactions where you learn about the real-world challenges your customers face.”

The personal approach to building the Schönox brand is reflected in its sales and support teams. Regional business managers are present at jobsites across the country on a daily basis, helping flooring professionals address tough subfloor challenges.

“We have a hands-on approach at HPS Schönox with our team getting involved to work side by side with customers,” said Doug Young, executive vice president, HPS Schönox. “In the field, building the Schönox brand is about fully supporting customers on both the business and technical sides of every project.”

 

Wicanders: Leading the rediscovery of cork’s features

Screen Shot 2016-08-29 at 2.31.43 PMWicanders, and the Amorim family of brands, have become synonymous with leadership and innovation in the realm of cork. In a world in which researchers, architects and designers are embracing ecological and natural materials, Wicanders has positioned itself to lead the renaissance and rediscovery of cork’s features and benefits within the flooring industry.

Over the years Wicanders has developed floor and wall coverings with exclusive properties due to its innovative Corktech technology. By using a unique engineered multilayer structure, which combines state of the art technology with the exclusive natural properties of cork, a higher standard in flooring was achieved. Corktech technology creates products that provide more silence, more thermal insulation, more walking comfort, more body wellness and more impact resistance. Creating a flooring product that is the holy grail of flooring: beauty combined with the functionality and benefits of both a hard and soft surface.

Using and combining different shapes of natural cork, Wicanders’ team of experts and trendsetters created a unique collection that results in a new approach in decoration, in harmony with nature and human emotions.

The style, charm and sophistication of these genuine natural designs create an atmosphere of authenticity and character.

In short, the Wicanders brand is defining the world of cork flooring.

 

DuChâteau: Pursuing innovation and the natural aesthetic

Screen Shot 2016-08-29 at 2.31.56 PMEsteemed by designers, DuChâteau is a luxury lifestyle brand that has set the pace for many of its peers. It’s a visionary company that looks to break the mold of traditional flooring manufacturers to assume a bigger, more luxurious place in the minds of consumers as the sexy “it” brand. No wonder DuChâteau has been listed on Inc. 5000’s Fast Growing Companies several years running.

Thanks to founders Benjamin Buzali and Misael Tagle, DuChâteau cemented itself as the rebellious brand that refuses to accept less than the best—the ultimate in product quality and service. It’s a trademark philosophy that Buzali and Tagle brings to every aspect of their business from its first rate, fashion-forward marketing to the construction of their ultra-elegant headquarters in San Diego. It’s a “live the life” atmosphere, where DuChâteau actually practices what it preaches. Without this, DuChâteau would not be what it is today.

DuChâteau continuously pursues innovation and the natural aesthetic. Launching hard-wax oiled floors in the then-untapped American market was only the beginning. Moving into wall coverings was also a bold step outside the box. This ever-expanding universe of DuChâteau is what makes the brand so attractive. Bold and vivacious. DuChâteau never takes a direction that does not reaffirm its rather unshakeable commitment to sustainability and customer service. These have formed the pillars of a brand that has become a driving force within the industry.

 

MP Global Products: Dare to be different—the story of QuietWalk

Screen Shot 2016-08-29 at 2.32.06 PMAs 2017 nears, MP Global Products begins preparations for its 20th anniversary. While the early days were spent concentrating on carpet padding, the company’s research and development led to the creation of an acoustic underlayment designed to lie beneath a new flooring category that arrived on U.S. shores in 1994: laminate.

MP Global’s QuietWalk underlayment was completely different than the many foam products that were already on the market. Manufactured primarily with recycled fibers from the carpet and textile industries, MP Global created a very unique product that quickly became popular through distribution and large retailers.

The result was a very effective product for protecting and silencing hard surface floating floors, which made them sound more like attached real wood. Not only was it good for the overlying floor, but it was also beneficial for the environment because it was recycled material. You might say MP Global was green before the movement became popular.

MP Global’s company’s focus early on was to build the product brand of QuietWalk vs. the company name—which evolved from Midwest Padding to MP Global Products. The strategy worked well, and although MP Global has other private-labeled products, QuietWalk remains a bestseller.

Today, architects and designers specify QuietWalk by name—it is one of the leading brands for use in multi-family housing to deaden impact noise between floors in condominiums and apartment buildings.

 

Inhaus: A drive to be the best in home design

Screen Shot 2016-08-29 at 2.32.17 PMIn just its 15th year in North America, the Inhaus brand possesses a rich European heritage as one of the pioneers and largest producers of laminate floors. Seeking to be the best rather than the biggest, Inhaus continues to strengthen its position in the industry with a passion for design that is reflected in a few core facets of its brand.

Design forward. Inhaus continually watches global trends and develops new designs. This year, parent company Classen completed a major investment in building a 100,000-square-foot design center in Germany where its team of designers and master carpenters work full-time on new designs, enabling Inhaus, the North American marketing arm, to enhance its product offering with original and constant design innovation.

Boutique excellence. This approach speaks to the personal passion Inhaus has for its products, and to the belief that design is more than just technical performance or surface aesthetic. Inhaus strives to offer a carefully and professionally curated selection of only the most current and relevant on-trend floors.

German engineered. All of Inhaus’ laminate flooring is precision crafted in Germany, which is synonymous with high standards of engineering. This focus on technological developments has led to multiple proprietary technologies, such as Megaloc, the company’s patented angle-drop installation system. With continuous investments in R&D and technology Inhaus is able to enhance its product offering with uncompromising value and production flexibility. The latest product innovation, SONO, due to launch later this year, is an entirely new category of waterproof flooring. It is made from a ceramic composite core without the use of PVC, formaldehyde or phthalates.

Ultimately, all of the attributes that make up the Inhaus brand capture a love for home design that is shared by its customers.

 

Pedross America: Moldings to match every wood floor

Screen Shot 2016-08-29 at 2.32.25 PMPedross America offers the highest quality and perfectly stained-to-match moldings for every engineered and hardwood floor on the market. The company’s unique price point, the superior quality and the unbeaten matching capabilities are key to Pedross’ success. It is a success the company shares with its customer base all across the United States and Canada. The company’s aim is to make its partners more successful and competitive by offering a min/max system to ensure their business can become more profitable.

Pedross recently started production at its new, state-of-the-art facility in Virginia with the goal of providing even shorter lead times and better service to its customers. Once fully functional, Pedross will be able to offer customers a two-day lead time from the time they place an order until it ships. Pedross’ newly developed direct ship program coupled with a wide range of different wood species provide its customers the flexibility they need and gives them the freedom to decide whether to stock moldings at their location or let Pedross help with the shipping. There are no order minimums.

Innovative companies like Pedross America are continuously moving forward. The future of your business cannot wait.

 

Wickham Hardwood Flooring: Committed to customers—and the environment

Screen Shot 2016-08-29 at 2.32.39 PMWickham Hardwood Flooring has emerged as one of North America’s premier flooring companies, winning a Best of Surfaces award at the 2016 show in Las Vegas as well as other prestigious industry honors.

With a critical eye for new looks, colors and textures, Wickham is viewed as a leader in style and innovation. Located near Drummondville in Wickham, Quebec, Wickham Hardwood Flooring was founded in 1989. With determination and years of hard work, the company has come to play a major role in today’s market and earned worldwide recognition for its products.

Wickham Hardwood Flooring has continued to stay on the forefront of the newest and safest finishes the industry has to offer. The company has chosen two of the finest companies in the world to partner with on its oil finishes—Akzo Nobel and Woca. Akzo and Woca are known to the world as innovators and manufacturers of the best finishes.

More importantly, Wickham has always been committed to looking out for the environment and its customers’ well-being and peace of mind. That peace of mind comes from working with some of North America’s most reputable lumber suppliers over the past 25 years—companies that stand behind their products and have gained a level of trust that is so important in today’s marketplace.

Customers can enjoy peace of mind knowing Wickham flooring will not cause any long-term damage to the environment. It is produced entirely in North America, where forest management and timber production are subject to the most strict environmental laws and regulations in the world.

 

Shaw Floors: A brand built on service, progress and growth

Screen Shot 2016-08-29 at 2.32.47 PMHonesty, integrity and passion set the stage almost 50 years ago and served as the foundation from which the future largest manufacturer of carpet was established. Since that time, the company’s values still remain true, but Shaw Floors has transformed from a single-category producer to a leading, total flooring brand with a laser-focused dedication to servicing its customers and the consumer. Shaw is proud of its heritage and even more grateful for the confidence its loyal customers have shown over the years.

The Shaw Floors brand is synonymous with quality, service and flooring expertise. That is reinforced each year through many surveys and rankings voted on by retail partners. The company is honored that the breadth of its product portfolio earns Shaw Floors the unique ability to provide consumers with flooring that’s right for them. Through Shaw Floors’ products and services, the consumers’ design vision comes to life, enhancing their safe haven and oftentimes largest investment—their home.

Shaw Floors has demonstrated continuous leadership through its company values and cutting- edge innovations such as R2X, the industry’s premier stain and soil resistance protection; the completely redesigned Epic Plus engineered hardwood; the award-winning shawfloors.com; the revolutionary FloorVana app; and the company’s exclusive LifeGuard technology found in Shaw Floors carpet and enhanced vinyl plank, Floorté, which protects against spills and life’s mishaps. These products and services, plus many others, provide retailers with solutions that ultimately give consumers confidence in their investment.

 

USFloors: A label that personifies power and performance

Screen Shot 2016-08-29 at 2.32.59 PMA successful brand requires laser focus and a consistent message that resonates with the consumer. For the last 15 years, USFloors has carved out a message as a leading manufacturer and distributor of unique and sustainable flooring in the bamboo, wood, cork and COREtec/WPC segments.

As the world leader in WPC flooring, USFloors understands the importance and power of brand—specifically the patented COREtec brand. Today, COREtec The Original is the most widely recognized and respected brand in the WPC category. USFloors leads the segment in innovation and design with an excitement level that has not been seen since the emergence of laminate in the mid 1990s. COREtec offers consumers a worry-free flooring option along with numerous features and benefits that cannot be found in luxury vinyl plank, sheet vinyl, laminate or hardwood.

USFloors also continues to lead with its latest introductions—COREtec Plus HD and COREtec Plus Design. The HD Collection features embossed in register technology along with a four-side enhanced bevel edge in 15 rustic wood décor SKUs. The Design collection consists of multi-tonal and multi-width plank and tile visuals in 10 SKUs. With these 25 summer 2016 introductions, USFloors again sets a standard that others will chase.

USFloors will continue its leadership role in innovation and design, bringing to market the designs, decors and technological advancements that today’s consumers demand.