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Wood: Sector maintains share on strong demand

June 26-July 2, 2018: Volume 34, Issue 1

 

By Reginald Tucker

Rising demand for residential replacement projects combined with a strengthening new home construction market contributed to another steady year of growth for the U.S. hardwood flooring industry. FCNews research shows wood sales at the first point of distribution climbed to $2.32 billion in 2017, a 4% increase over 2016. Volume-wise, units shipped increased 3.6% to 930 million square feet, reflecting an uptick in slightly higher-value goods.

To put the numbers in greater perspective, in 2017 the hardwood sector accounted for nearly 10.6% of total industry sales but more than 17% of hard surface revenues. With respect to volume, wood represented only 4.7% of total industry square footage shipped but 11% of all hard surfaces sold at the first point of distribution. Five years ago, wood’s share of total industry sales was 9.5%, while its share of total industry volume was 4.1%. Going back even further—to 2007—hardwood’s share of total industry sales was 9%, while its share of volume sold was 4.4%. However, the size of the total pie at that time was much greater—$22.34 billion in sales in 2007 vs. $17.3 billion in 2012. Ditto with respect to volume; in 2007, more than 22.7 billion square feet of product was shipped compared to just over 16.8 billion in 2012.

While evidence shows competing hard surface categories seem to be growing at a faster clip (save for laminates), wood has not ceded its position relative to its ranking among the likes of tile, resilient flooring, WPC, etc. For example, wood represented the third-largest hard surface category in terms of dollars in 2017, trailing only resilient (19.2% market share of total industry sales) and tile (13.3% of total sales). Back in 2007, wood was also the third-largest hard surface category—although resilient and tile represented a much lower portion of the overall pie at 9.8% and 9.3%, respectively. Ten years ago, wood held a 9% share of the market. The only oddity is the volume of wood sold has been exceeded by the overall square footage of laminate flooring shipped virtually every year since 2009. Industry observers attribute this phenomenon to a variety of factors, including: much lower comparative pricing of laminate vs. wood; the relative ease of installing laminate flooring vs. more complex, intricate hardwood flooring products; and the vast number of retail outlets—including big boxes and discount stores—that sell laminate over the counter and online.

Industry executives attribute hardwood’s consistent performance over time to the strength of key end-use sectors here in the U.S. market. “Single-family construction and residential replacement continue to be the core drivers of demand for hardwood,” said Dan Natkin, vice president, wood and laminates, Mannington. “While the wood category grew by low single digits, the growth rates were different between solid and engineered, with solids declining in overall volume and engineered growing by mid-single digits.”

Other executives, including Natalie Cady, vice president, hard surface marketing, Shaw Floors, concur. “Residential is driving the market, which includes both single family and residential remodel.”

FCNews research supports those anecdotes. In 2017, residential replacement and new construction end-use markets accounted for 55% and 35%, respectively (or 90% collectively), of hardwood flooring sales. That’s up slightly from 2012, when new residential and residential replacement represented about 83% of category sales. One of the biggest shifts over that time period occurred in the commercial sector, which—including specified contract and Main Street market applications—accounted for 17% of sales. Last year, contract commercial and Main Street represented just 10% of sales, research shows.

The fact that hardwood is still be able to participate across a variety of end-use channels is a testament to the segment’s allure and viability. “A more stable economic environment continues to steer the hardwood segment on a course of steady growth, with increases in demand in both the new construction and remodeling markets,” said Michael Bell, vice president, hardwood, Armstrong Flooring. “We also see hardwood opportunities in the commercial marketplace.”

Other industry observers, including Brad Williams, vice president of sales and marketing at Boa-Franc, parent company of the Mirage brand, believe commercial performed better than many expected. In fact, as far as the ratio of end-use consumption is concerned, he feels a shift has occurred. “I believe single-family construction is driving the most growth in hardwood, followed by contract commercial and residential replacement.”

Shifting formats, trends
While several industry executives continue to debate the precise ratio of end-use consumption, there’s no denying there is an industry-wide shift in the types of hardwood floors produced and sold. Take traditional solid hardwood floors— the mainstay in many regional markets—vs. the preponderance of new, technologically advanced engineered formats. Ten years ago, solid wood floors represented more than 60% of the market, anecdotal information shows. According to FCNews research, the engineered/prefinished segment is close to overtaking solids, accounting for roughly 57% of sales.

While solid—what some refer to as the industry “gold standard”—is still preferred by many customers, home builders and designers in markets like the Northeast and Pacific Northwest, the rapid development and evolution of products that fall under the category of engineered floors is opening up opportunities even in hardcore solid markets.

“There’s never been more changes taking place in the wood flooring segment than what we’re seeing today,” said Tom Lape, president, Mohawk Residential. “The biggest trend we’re seeing in the wood flooring segment today is a blurring of the lines within the product categories. For example, we’re clearly seeing many customers, dealers and consumers moving away from solid at a rate that has been running unabated for five years running and continues to accelerate. We see the engineered category evolving right in front of our eyes from what was historically a 5-ply construction format to an HDF product solution.”

Mohawk is so convinced that engineered wood flooring products based on an HDF core are quickly overtaking conventional, multi-ply hardwood flooring options that it is banking on wholesale consumer and end-user acceptance of the emerging format. “When you see high-end custom builders and high-end production builders in the Northeast and Pacific Northwest coming off solid it is eye opening,” Lape said. “Solids are not going away, but where there is a reasonable trade off of in terms of cost, value, etc., I think you’re seeing the market accelerate the move to engineered.”

Boa-Franc’s Williams is in general agreement. “The shift in demand will continue to put additional pressure on manufacturers as the majority of domestic suppliers have solid equipment and capacity. This causes your business to transform when converting to producing engineered, or more engineered vs. solid. Everything changes—from your lumber purchasing to your go-to market channel strategy.”

For others, the continued migration from solid to engineered doesn’t necessarily spell the end of a category. While engineered floors offer opportunity for design innovation combined with its installation flexibility, solids still have their place. As Armstrong’s Bell explained: “The dynamics are different in solid vs. engineered. In engineered, we see much of the growth occurring on the bookends of the market with significant increases in the opening price point/value engineered products and the best/premium sliced- and sawn- face engineered products. Solid is similarly seeing increased activity on the best/premium side of the market.”

While it is generally accepted that consumer tastes differ by region and/or climate, some point to inherent limitations of solid products as an impediment to acceptance beyond the core solid markets. “With the demand and overall trend moving toward longer and wider, there are limitations you have solids that are not there with engineered,” Shaw Floors’ Cady said, citing the tendency of solid floors to expand and contract more easily than engineered. “Having the ability to go longer and wider will help people move more toward engineered. Plus, with single-family home construction on the rise, that represents an increase in concrete slab construction— and that lends itself to engineered. At the end of the day, we believe the solid market— which includes both finished and unfinished product—is steady, not actually shrinking.”

In keeping with the industry’s ongoing transition to engineered, suppliers are also seeing demand move away from traditional strip flooring to wider/longer plank formats. “We’re giving consumers more of what they want,” Mohawk’s Lape stated. “We’re selling planks up to 80 inches long x 9 inches wide, and we’re making better-performing products for contractors, retailers as well as consumers.”

While all this continues to play out, suppliers continue to fortify—and diversify—their product mix to ensure they have all the bases covered. Over the past 18 months, for example, Quebec-based Wickham Hardwood introduced several new engineered offerings designed to complement its solid collections. According to Paul Rezuke, vice president residential sales, U.S., the breakdown seems to follow along geographic lines. “As part of our engineered strategy, we targeted two platforms based on a 1⁄2- and a 3⁄4-inch format. We initially envisioned the 1⁄2-inch product would be most suited for the U.S. market and the 3⁄4-inch line for our Canadian business partners. What we are seeing is the demand in the U.S. market for a thicker platform appears to be on the rise. With this demand, we are projecting a significant demand for 3⁄4-inch platform engineered products in our U.S. footprint.”

The shift in product preference in wood goes beyond the product’s core construction. Industry observers are also gauging changing consumer tastes relative to color, species, surface texture and even board length and width. “The key is making sure we stay out in front in terms of styling and design,” Shaw Floors’ Cady explained. “We’re still seeing the move toward longer, wider planks, but we are also seeing a move toward more traditional visuals.”

At the other end of the spectrum, some suppliers are seeing a mild resurgence in demand not for domestic species—which had been rising in popularity—but for exotic looks. With anecdotal information and consumer purchasing trends showing shoppers gravitating more toward home- grown species such as walnut, hickory and birch, to name a few, others say there’s still a viable market for imported tropical species.

“Brazilian cherry, teak and oak are still in demand,” said Luxia Hong, director of business development, North America, for Grupo Maderero Amaz, based in Peru. “What we’re doing is taking the Brazilian teak, for example, and applying wirebrushing to the top layer. We can also apply stains such as gray, espresso and cappuccino—the colors that are trendy today. Brazilian oak can also take stains and wire brushing very well.”

Mitigating factors
Hardwood flooring has long been linked to its ability to con- tribute to rising home values, and it remains—as suppliers argue—the product that many homeowners covet. But aggressive competition from competing “wood-look” visuals available with LVT, WPC, laminate and, now, ceramic is a cause for concern.

“The growth of wood-look products such as WPC is an issue,” Mannington’s Natkin said. “While cannibalization is minimal for the consumer who really desires hardwood, there is conversion for consumers who are not sure what product is right for them.”

Armstrong’s Bell is in agreement, adding that—with the exception of tile—most of these products cost less than real hardwood. Also at play, he said, is the fact that the quality of the visuals and textures has evolved so much that many consumers feel comfortable using these faux wood products instead of the real thing. “However, there is nothing that can truly compete with genuine hardwood from either a look or value equation. It is a great, long-term investment and can actually become a strong resale argument, exceeding the initial installation cost of the floors. Plus, it’s organic, natural and renewable and, of

course, since it is natural, has less pattern repeat.”

Traditional, hardwood-only suppliers
seem to be taking it in
stride. As Wickham’s Rezuke explained, “Currently, WPC appears to be the category of the month.
We’ve experienced this
in the past with both laminate and LVT. Our position remains that
there will be new products that will present challenges. But in thelong run, hardwood
will always maintain a
significant market share in the flooring industry.”

Price pressures
On the other side of the coin, wood’s classification as a natural product also subjects the category to price fluctuations due to rising raw material costs. In fact, some of the segment’s top suppliers recently announced hikes in the 3%-7% range, mostly on solid goods. Suppliers warn it might not be the last this year.

“We are seeing some upward pressure in raw material pricing,” Mannington’s Natkin said. “Certain regions are more dramatic than others.”

Armstrong, one of the suppliers to pass on increases to its customers earlier this month, attributes the hikes to rising natural gas and electricity prices—all of which impact costs to power the plants. Bell doesn’t see any let up in sight. “We expect this cost pressure to continue throughout 2018.”

Canada-based Mercier Wood Flooring, which instituted a price increase at the start of the year, hinted at the possibility of additional hikes if cur- rent trends persist. “We try to stay consistent,” said Wade Bondrowski, director of sales, U.S. “However, a couple more increases in raw materials and we will be forced to raise prices again.”

Boa-Franc, also based in Canada but services customers throughout North America, is feeling the pinch as well. “We are still sitting at a high point on species such as red oak and white oak,” Williams said. “Hopefully it will cool down and stabilize in the quarters to come.”

Mid-term outlook
Despite raw materials fluctuations, pricing pressure from imported product and increased competition from other hard surface categories, executives remain optimistic about the hardwood sector for the remainder of 2018. “We predict the overall hardwood category will have a moderate growth rate of 3%-5% this year,” Williams said, citing the commitment of its distribution partners. “We feel our greatest opportunity continues to be within our existing network.”

Don Finkell, president and CEO, American OEM, is confident the category as a whole

will grow by at least 6% this year, surpassing the rate of growth achieved in 2017. The prospects look even better from an internal standpoint, he noted. “I expect our company to more than double that growth rate at about 12% to 15%. We are adding new products for our existing distributors, building on our private-label programs and developing coverage of our new Hearthwood brand. Plus, we will be adding more domestically made products to our Hemisphere brand.”

Others are similarly bullish. “We’re still forecasting growth in the wood segment, although I think it’s going to be a different wood segment by virtue of a lot of trends we’ve been talking about,” Lape stated. “The trend is going to be more innovation in the wood category. The industry is not sitting still; it continues to innovate in terms of form, function and value.”

For Mercier, the key to continued success lies in geographic expansion—along with continued development of its engineered program. “In a number of areas, the Mercier line is fairly new,” Bondrowski said. “But with the amount of design and quality we have and continue to pursue, these markets could use a product line like ours.”

For Shaw, opportunities abound both within industry wide. “The launch of our premium brand, Anderson Tuftex, will bring about some exciting new possibilities,” said Drew Hash, vice president hard surface product category management. A strengthening housing market can’t hurt, either. “The greatest opportunities for hard- wood products are within single-family and new construction. We continue to expect an increase in housing starts, which will have an impact on growth throughout 2018.”

 

Rising demand sends lumber pricing higher
By Reginald Tucker

Rising demand for hardwood flooring products resulted in a steady rise in lumber prices across a range of species in 2017, a trend that is expected to continue at least throughout 2018. That’s according to data released by Forecon, a forestry consulting firm with in-depth knowledge of the U.S. lumber industry. Forecon reports high demand for red oak, hard maple, ash and cherry (the latter due to mostly export demand). Red oak, which has set record export levels in volume and dollars this past year, is also seeing robust demand domestically.

Those findings are corroborated by statistics cited in the latest Indiana Forest Products Price Report and Trend Analysis published in January. According to the report, pricing for premium species such as red oak and white oak—often viewed as the primary market/economic indicators in the hardwood industry—is trending higher. White oak lumber (#2/Btr) prices are 3% higher than what was reported in July 2017, while red oak prices are almost 6% higher. Aside from domestic demand—especially among sectors like millworking and cabinetry suppliers, which compete for raw materials—industry observers cite strong

export activity to China. Current pricing for red oak, especially #2/3A red oak, is at levels not seen since January 2015. The most popular kiln-dried grade red oak, #1C, is increasingly high in demand among Chinese and Vietnamese suppliers.

Pricing for green upper-grade red oak lumber (FAS & FIF) peaked at $1,370 per thousand board feet (MBF) in the summer of 2014. Prices for FAS lumber spiraled downward through early 2016 before rising to the current price of $1,150 MBF. Both #1C and 2A pricing have been increasing since January 2016 to $845 and $560 MBF, respectfully.

White oak pricing is also seeing a bump, with most of the upper-grade lumber heading to the Far East and Europe. Here in the States, white oak demand by hardwood flooring producers is rising. Upper-grade white oak pricing has increased steadily since January 2016 to its current

price of $1,650 MBF. This price is also 38% higher than what was reported in July of 2013. Further, #1C and #2A pricing has also firmed quite well with increases of 34% and 7%, respectively.

Other species commanding high prices include: upper-grade green walnut ($2,900 MBF). According to the report, #1C prices are over 47% higher than in July 2013 and 16% higher than the figured reported in July 2017. Meanwhile, the cherry market continues to rebound, primarily due to Chinese demand. Upper-grade cherry prices are trending 16% higher than the year-ago period, with common grades averaging 13% higher than those reported in July 2016.

Lastly, upper-grade hickory lumber prices are nearing levels reported during the summer of 2015—a high point for the product. The overall average of hickory lumber prices are 7% higher than the fall of 2016.

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Resilient: WPC, LVT, SPC continue to reign supreme

June 26-July 2, 2018: Volume 34, Issue 1

 

By Lindsay Baillie

The resilient category once again led the flooring industry in terms of percentage growth, thanks mainly to the performance of sub-categories such as WPC and SPC. FCNews research shows the category generated $3.993 billion in sales in 2017—an industry-leading 14.1% increase over 2016’s $3.499 billion. In terms of volume, the category racked in 4.024 billion square feet at the first point of sales, a 13.8% increase from 2016’s 3.537 billion square feet.

The resilient sector’s chart-busting performance in 2017 comes even more into focus when measured against other hard surfaces. When stacked up against ceramic tile, hardwood, laminate and other hard surface materials, resilient accounted for 30.34% of sales. When taking total flooring sales into account, resilient represented 18.15% of revenue and 20.4% of volume.

What’s even more impressive is the fact that resilient flooring’s percentage increase in revenue is a little over three-and-a-half times the growth of the entire industry, while volume growth is approximately five times that of the flooring sector as a whole.

Resilient’s double-digit growth in sales in 2017 is even more significant when looking at its performance over the past few years. FCNews research shows 2017’s sales represent a 36.6% increase over 2015’s $2.924 billion and a 60.2% increase com- pared to 2014. To put resilient’s growth into perspective, total resilient sales increased by 96.2% from 2012’s $2.035 and 81.8% from 2007. Meanwhile, total resilient volume increased 65.6% from 2012’s 2.43 billion square feet and 23.8% increase over 2007. The greater percent of increase from 2012 compared to 2007, observers say, reflects the effects of the Great Recession, which had just started in 2007 but was felt through 2012.

Industry executives cite several factors that contributed to another year of stellar growth of the category. One of which is the lingering effects of an improving economy. As Kurt Denman, chief marketing officer and executive vice president, sales, Congoleum, explained, “Fundamentally, the economy is good. Consumer confidence is high and there’s a ton of building going on, which has helped in all aspects of resilient.”

Many resilient manufacturers also point to the overwhelming success of WPC and rigid core products. “Multi-layer flooring is leading the way in LVT growth,” said Russ Rogg, president and CEO, Metroflor Corp. “While other variations are also growing, multi-layer flooring is outpacing glue-down and other varieties in a significant way.”

Executives like David Sheehan, senior vice president, product management, Mohawk Industries, believe WPC and rigid core continue to help push the resilient needle as more people discover the products’ benefits. “Floors that are rigid in nature are the darlings of the industry and have captured the attention of many sales associates and, in some cases, are being oversold to customers,” he noted.

Another key factor driving resilient sales is the constant innovation surrounding LVT, WPC and rigid core products. “Compared to other flooring categories, the LVT sector has seen many changes from additional looks, durability, availability and sheer innovation,” Jamey Block, vice president, product management resilient, Armstrong Flooring, told FCNews.

Beyond the category’s various product attributes, another driving factor is the number of manufacturers in the resilient game. “More people are discovering the benefits of resilient flooring,” said Steven Ehrlich, vice president of sales and marketing, Novalis Innovative Flooring. “That discovery fuels demand, which, in turn, fuels more production—and so on.” Another factor is the growing availability of resilient across a variety of flooring brands, he added.

Residential rules the roost
FCNews research shows the residential market made up almost 64.76% of total resilient revenue or $2.586 billion. Residential resilient also accounted for nearly 71.8% of total resilient volume. What’s more, residential LVT (including WPC and SPC) finished out 2017 with an estimated $1.888 billion in revenue, representing 73% of total residential resilient sales. In terms of square feet, research shows this red-hot product garnered 1.379 billion square feet, or 48.1%, of residential resilient volume.

Resilient manufacturers attribute the category’s stellar performance, in part, to the strength of key end-use sectors. While some industry executives see the greatest activity in the replacement/redesign markets, others are finding their products being used in builder/new home construction applications—including both single- and multi- family installations. However, most executives agree each segment is seeing a different resilient product take over market share.

For Armstrong, the replacement market continues to be strong. “We’re seeing strong growth across channels for remodel work,” Block explained. “We are also seeing a lot of excitement in new home construction with [rigid] products.”

According to David Kim, managing partner, NuFlors, single- and multi-family in new home as well as residential remodel saw improved growth in 2017. “Both [sectors] are expected to surge as the year continues,” he said. “As new construction has seen continued growth the last 10 years, we also see replacement growth as new technologies make it easier to replace and renovate existing floors.”

While some manufacturers are seeing mostly WPC and rigid in the multi-family segment, other companies feel more dry- back is being installed. “That’s where the majority of the dryback business is,” Lindsey Nisbet, marketing director, EarthWerks, told FCNews. “[Builder] may be taken over by WPC, but [dryback] is standing strong in multi-family.”

Within residential LVT, click, floating and dryback products saw quite the shakeup. Back in 2016, click represented 39.7% of LVT revenue. In 2017 that number jumped to 55.1%. The large increase in click sales, observers say, resulted in a percent decrease for both floating and dryback products, which went from 6.8% to 4.8% and 53.5% to 40.3%, respectively.

Last year proved to be a big year for WPC and SPC, which claimed 45.8% of residential LVT dollars. In terms of volume, the sector’s go-to products captured 31.8% of residential LVT. Despite click LVT’s growth in 2017, many are seeing the product lose share to WPC and SPC.

“Whether it’s WPC or rigid core, there are a couple of things they just do better,” Congoleum’s Denman said. “One is it’s an easier installation product because you’re not trying to get that floppy click to come together. It inherently has a stronger locking joint. Most of it is sold with a backing on it so you’re getting sound mitigation. Generally speaking, it’s a better perceived value. If you hand someone a floppy click product and a WPC product and tell them price is relatively the same, as a consumer you’d take the thicker one. Plus, they’re doing great things with it, such as embossed in register, enhanced edges, longer boards.”

Another factor in WPC and SPCs’ takeover is the decrease in click innovation, according to EarthWerks’ Nisbet. “We have some of our click products that are still doing well, but you don’t see a ton of new click products being developed. The rigidity of WPC and SPC products just make it easier to install and a higher performing product.”

While WPC has continued to steal market share from sheet and traditional LVT, it is now facing its own pressure from SPC. Most flooring executives see a place in the market for both WPC and SPC, citing their differentiating factors as being enough to keep both alive.

“We have been educating our salesforce along with the RSA and consumer as to the benefits of both WPC and SPC,” said Jamann Stepp, director ofmarketing and product management, USFloors. “It’s not that one is necessarily better than the other, but rather WPC is designed and geared toward residential installations while SPC is engineered for more of a commercial application. The growth of WPC/SPC will continue to affect the growth opportunities for sheet and flexible vinyl. However, there will continue to be a market for these producing traditional click LVT, but we are firm believers that WPC will continue to represent the majority of multi-layer flooring category sales,” Metroflor’s Rogg said. “WPC products, which generally have a more traditional LVT decorative surface, still offer benefits SPC products don’t—such as more authentic textures, lighter and more easily handled larger sizes and formats, better acoustic advantages and so forth.”

Sheet cedes share
As a result of LVT, WPC and SPCs’ continued success, sheet vinyl products continue to lose market share. According to FCNews research, the segment was down 2.8% from $596.1 mil- lion in 2016 to $579 million in 2017. What’s more, the category saw a 4.2% drop in volume.

In addition to the increased consumption of LVT and WPC, there are other factors affecting sheet’s market share, industry experts say. “Installation is a significant issue for all flooring, especially with sheet,” Mary Katherine Dyczko-Riglin, product manager of residential sheet vinyl, Mannington, explained. “It’s hard to find installers across the country. With the installation being perceived as easier for click products, that’s definitely helping it steal share. Things that have always traditionally been sheet are also seeing dryback start to come in and take its place.”

Heavy promotion of LVT and WPC is also a factor. “I think the numbers we’re seeing right now are indicative of people becoming very aggressive with overselling the capabilities of a low-end LVT,” said Michael Finelli, director, Beauflor USA.

Despite sheet’s continuous loss of market share to LVT and WPC products, most manufacturers don’t see the sub-segment going away for good. “There are certain price points that sheet goods will always be able to participate in that I don’t believe LVT or WPC will be able to,” said Drew Hash, vice president hard surface product category manager, Shaw Floors. “There’s a place for all of them—it just may not be the same mix that we see today.”

Mohawk also sees a place for sheet. “We’re convinced there’s always going to be a flexible market,” Sheehan said. “And the value proposition of sheet is still great.”

Within sheet, FCNewsresearch shows felt continues to lose market share to fiberglass. While felt was approximately 26.3% of sheet dollars and 29.7% of sheet volume in 2016, the product has dropped to 22.5% of dollars and 25.3% volume in 2017. Most manufacturers note the benefits of fiberglass as the products main selling point; however, many are still seeing success with felt.

“Felt is definitely continuing to lose share quicker than fiberglass,” Mannington’s Dyczko- Riglin said. “And it’s starting to lose share not only to fiberglass but to LVT. The fiberglass-backed products are typically a bit more installation friendly; they’re a bit more resilient to minor errors, handling issues, etc. They’re not going to break or permanently crease. Whereas with felt, you have to have a little more finesse.”

In addition to ease of installation, proponents say fiberglass-backed products offer comfort underfoot and water resistance. “While we do forecast the shift from felt to fiberglass to continue, Armstrong Flooring continues to bring industry-leading designs to our felt structures because we know there are still segments of the market and consumers that want a felt product,” Brock stated.

Congoleum is also seeing strength in its felt business. However, as Denman reports, the company is seeing some shifts in residential remodel, which is moving more toward LVT.

Some manufacturers believe the industry has only scratched the surface with respect to resilient’s global popularity and innovation. “LVT is still in an early growth stage,” said Jenne Ross, director of marketing, Karndean Designflooring. “We’re getting a lot of people who are still early adopters and are just finding out about the overall durability and performance of the product.”

Commercial keeps climbing
Resilient products in the commercial space clocked in at $1.624 billion in 2017, a 28.5% increase from 2016, according to FCNews research. What’s more, the segment also saw a 17% increase in volume. Industry experts believe healthcare, education, Main Street and hospitality markets helped propel commercial growth. Experts also cite factors including the increased presence of WPC and rigid core products, and hard surface’s continued seizure of market share over soft surfaces.

“We’re seeing that kind of growth in every channel we service, whether that’s Main Street or traditional commercial,” Shaw’s Hash said. “I think that’s because the product offers just so many great attributes in every channel.”

Much of commercial’s sales came from commercial-grade LVT, which clocked in $796.5 million in 2017—a 22.8% growth over 2016’s $648.6 million. Within this sub-category, WPC made up a good portion of dollar growth, swelling from $24 million in 2016 to a little under $72 million in 2017. Dryback saw a 5.1% growth in volume, while click has started to see a drop-off—likely due to WPC’s growth in volume from 11.5 million square feet in 2016 to 41.7 million square feet in 2017.

“The movement from soft surface to hard surface is continuing to work its way into all commercial segments and is one of the contributing factors to resilient growth overall,” Armstrong’s Block explained. “The products’ looks as well as the demand for durability and ease of maintenance continue to propel resilient flooring solutions to the forefront.”

Michael Raskin, founder and CEO, Raskin Industries, has seen growth in hospitality in particular. Reason being? “Hotels are doing away with carpet because of poor maintenance, staining and odors. The benefits of LVT that apply to hospitality include durability, warm visuals and easy maintenance. In addition, we are offering acoustical backing to meet sound requirements.”

Al Boulogne, vice president, commercial resilient business, Mannington Commercial, sees traditional glue-down as the main driver of growth in specified contract applications. “While WPC and SPC have been huge drivers of growth on the residential side, it’s a little different on the commercial side,” he explained. “Even though WPC and SPC are certainly driving growth in multi-family and hospitality, for the more traditional commercial segments I still think it’s traditional LVT that is gaining momentum. There is so much about the category that pulls it through.”

Commercial sheet rose to approximately $224 million in 2017, a 4.9% uptick increase over 2016’s $213.5 million. This increase, according to resilient experts, is a result of multiple factors—not the least of which is product performance. “No doubt the increase in sheet is due to new products and advances in technologies,” said Jeff Collum, president and CEO, Shannon Specialty Floors. “We are also seeing an increase in sheet use in education, hospitality and government markets. Non-vinyl sheet is also capturing more and more commercial business.”

VCT holds on
With all the talk surrounding commercial-grade LVT, WPC and the like, it’s easy to overlook traditional product categories such as vinyl composition tile (VCT). But statistics show the sub-category is still very much relevant. According to FCNews research, VCT saw a 0.6% increase in dollars (essentially flat) but a 7.7% increase in units.

“VCT provides unique value and long-term durability that high-traffic commercial customers appreciate and very few other products can replicate,” Armstrong Flooring’s Block said. (Armstrong Flooring purchased Mannington’s VCT business in 2017.) “We have also identified opportunity to further enhance this value with the extension of our Diamond 10 technology to the VCT category.”

Rubber rises up
FCNews research shows rubber generated $217 million in sales in 2017, a 3.1% uptick over 2016. In terms of volume, the category accounted for 57 million square feet, which translates to a 4.1% increase from last year. Some flooring executives attribute this overall increase to rubber’s use in areas other than heavy commercial environments. Others suggest rubber’s natural resiliency, resistance to stains, mildew and mold, and call for less chemicals makes it more appealing in places such as healthcare, hospitality and offices.

“As environmental concerns rise, specifiers are realizing rubber flooring’s green benefits,” said Joe Visintin, product manager, Tarkett North America. “For example, with no finish application required, fewer chemicals are required to maintain the floor and less water is used.”

Proponents believe rubber is receiving more attention thanks in part to updated visuals and innovative locking systems. Visintin sees rubber making its way from airports and schools to other areas as well such as healthcare waiting rooms, corporate hallways and offices, and hospitality lobbies.

Mike Tierney, national sales manager, Roppe, sees newer and brighter visuals as a driver for success. “Rubber flooring has always been popular in healthcare and education segments largely due to inherent traits such as the natural resiliency, resistance to stains, mildew and mold, comfort underfoot along with ease of maintenance,” he said. “However, newer colorations and versatile sizes or profile patterns make rubber flooring a great option for retail and hospitality spaces as well.”

Linoleum also shines
FCNews research shows linoleum experienced an 8.75% increase to $87 million from 2016’s $80 million. What’s more, its volume increased 8% to 32.25 million square feet. According to Denny Darragh, general manager North America and Asia, Forbo Flooring Systems, linoleum’s growth was driven primarily by the education segment. He also explained that linoleum’s stable pricing resulted in almost an exact percent of increase for both revenue and volume.

Imports vs. domestic
The resilient category is still heavily reliant on import activity with 68.4% of product coming from outside the United States, FCNews research shows. Despite this percentage, domestic production continues to increase, taking a small percentage away from imports. In 2017, domestic production accounted for 31.6% of the category, a slight increase from 2016’s 30.2%.

“There has been a shift toward U.S.-made LVT,” Armstrong’s Block said. He cited the company’s own state-of-the- art facility in Lancaster, Pa., as well as capital investments in its Stillwater,
Okla., facility. “We have invested millions of dollars in the domestic production of LVT to produce resilient flooring in a cost-effective manner, improve styling and be more responsive in servicing key market segments. We’ll continue to balance domestic production and sourcing product to best meet our customers’ needs.”

When looking at specific products, anecdotal research shows approximately 85% of residential sheet is domestic and about 77% of commercial sheet is imported. VCT continues to be virtually domestic, while all linoleum is imported. In terms of LVT, about 75% of commercial LVT is imported. Roughly 80% of residential LVT is made abroad, as is all WPC.

Even though U.S. manufacturers continue to increase domestic production capacities, the bulk of LVT remains imported. According to Beauflor USA’s Finelli, the need for imported LVT products has caused an oversaturation of the market. “You have a lot of overcapacity from import manufacturers that saw a big opportunity in the growth of the LVT category. It’s such a fast-moving product for us that we rely still on our European manufacturing for our LVT. The goal would be to bring that here to the U.S. in the next year or two.”

With both domestic production and imports, the resilient category faces a pricing war. For manufacturers, such as Raskin Industries, newer products have to rely less on beating prices and more on innovative design and proper distribution.

“It can’t be all about price,” Raskin explained. “You need to give on certain products to compete with the large, high-volume, carpet-manufacturing companies and good distributor partners to understand how to work with brands on better items. You need to offer unique designs to separate yourself from the price war.”

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Carpet: Hard surface onslaught keeps growth in check

June 26/July 2, 2018: Volume 34, Issue 1

By Ken Ryan

The uphill battle against unrelenting growth in hard surfaces across multiple segments kept the U.S. carpet market in check in 2017, with overall sales and volume essentially flat for the year. FCNews research shows sales inched ahead 0.6% to $8.83 billion while volume (which includes area rugs) was up a scant 0.4% to 11.25 billion units. Rug sales grew about 3% in 2017, the fourth year in a row the segment has grown, thanks primarily to the growth in hard surfaces.

Dissecting the category, residential carpet sales rose 2.5% in 2017, a reversal from 2016 when it fell 1.5%. Meanwhile, units were down an estimated 0.5%, also a departure from the previous year when volume was ahead 1.5%. A movement toward higher-end carpet and frequent price increases, allowed carpet sales dollars to increase even though units declined.

Overall, carpet and rugs make up 57.3% of the overall flooring market in volume, still the largest percentage of any flooring surface, yet waning from its dominant days of a decade ago when soft surface commanded 66.9% of the market. That year, carpet sales were down 10.1% and volume fell another 13.7% as the flooring industry was mired in a terrible housing crisis.

By 2012, carpet’s dominant market position was down to 64.6% (volume), a loss of 3.3 percentage points since 2007. Between 2012 and 2017, however, car- pet’s share as a percent- age of the overall industry has receded even more, down 7.3 percent- age points.

How much longer carpet’s steady decline will continue is not known, although there are industry executives who believe the rate of decline will start to slow and may stop entirely for a while. That line of thinking is credited to enhanced technology that can produce better goods that consumers demand, as well as an aging population, which—studies show—prefer softer surfaces, especially in their bed- rooms, which is still a solidly carpet segment within residential.

Carpet continues to play well in certain regions, in particular the upper Midwest, the Northeast and Canada, and is faring well at both the higher (above $15 retail) and lower end.

Mill executives who are looking for any signs of a carpet resurgence see indications that hard surfaces may get overstretched to the point where carpet rebounds. They point out that today’s newer homes tend to have higher ceilings than in the past; the argument goes that if the home is dominated by hard surfaces, there will be issues with noise. To abate this, soft surface is needed, and observers suggest broadloom would be a better solution than rugs. On the commercial side, the biggest complaint with restaurants isn’t the food or the service—it’s the noise, thanks to all hard surfaces.

Age is another factor in carpet’s long-term favor. The nation’s population has a distinctly older age profile than it did 16 years ago, according to the U.S. Census Bureau. Its estimates show the nation’s median age rose from 35.3 years on April 1, 2000, to 37.9 years on July 1, 2016. Residents ages 65 and over grew from 35.0 million in 2000 to 49.2 million in 2016, accounting for 12.4% and 15.2% of the total population, respectively. Statistics like these give carpet executives a reason to be optimistic. “We still believe in the category,” said Chet Graham, president of Marquis Industries. “We know trends come and go and carpet is still more than half the industry. I think the numbers will get closer—with hard surfaces gaining more market share, but then we think carpet will inch up. As people get older, they don’t want to walk on cold floors.”

The improving economy has provided many consumers with the confidence to spend more on their homes, and that goes for all surfaces. “The increased popularity in hard surfaces has led to carpet being used more in the bedroom and retreat areas of the home,” said Mark Clayton, president, Phenix Flooring. “This has led to increased demand for better designs and improved styling in the carpet category and has led to the continued upward movement in the category in terms of face weights and retail price points.”

T.M. Nuckols, president, Dixie Residential, also endorsed the growth in hard surfaces as helping to create demand for better goods in carpet. “Consumers are looking for differentiated styles (patterns, loops, etc.) to complement the beautiful hard surfaces being installed,” he said. “And there is movement toward cut/bound rugs from broadloom styles. These can be area rugs, hallway runners, stair carpet or other niche applications in the home.”

If nothing else, 2017 was a year of volatility in the carpet world. Continued increases in raw material costs, led by polyester chip pricing, forced carpet companies to raise prices, in some cases multiple times during the course of 2017. The year also saw the departure of Beaulieu, which was acquired by Engineered Floors out of Chapter 11; and the abrupt shuttering of Royalty Carpet Mills, a long-time West Coast mill known for better goods. Some of Royalty’s business was picked up by Tuftex, which in 2017 was merged with Shaw’s Anderson hardwood brand to create Anderson Tuftex. AT launched at the beginning of 2018.

Category leaders Shaw and Mohawk, as well as the Dixie Group, benefited by the upheaval as well. In its 2017 financial statement, Dixie reported its residential sales benefited from its response to the market space vacated by Royalty on the West Coast. “We responded to the Royalty shut down by introducing our Pacific Living collection as well as adding numerous new dealers on the West Coast,” said Dan Frierson, chairman and CEO. “The impact of these efforts was an over 20% increase in sales for our West Coast regions for the second half of 2017 as compared to the same period the prior year.”

The loss of Beaulieu, once the No. 3 carpet mill, was a boon to Engineered Floors, which since its inception in 2009 has now become a $1 billion-plus company with a stronghold in the commodity segment of car- pet.

Commercial
Commercial carpet, which makes up 43.1% of the overall carpet market, was estimated at $3.805 billion in sales for 2017, with specified contract sales coming in at $3.104 billion and Main Street business at $701 million.

[Note: For years, a large percentage of mills considered level loop polypropylene a Main Street product, mostly installed in rental space/tenant improvement and low-end apartments and basements. Today, much of this business has been lost to low-end polyester cut piles. These cut-pile sales are reported as residential, not Main Street. As well, some mills break out Main Street from their specified business; others do not.]

For the second year in a row, commercial lagged residential. In fact, estimates had commercial volume down 6% while sales declined 3%. The drop off speaks to the sweeping dominance of LVT, which has captured share in virtually every segment of the commercial market. If not for the continued success of modular carpet, the numbers would have been far worse. “Resilient is definitely taking share from carpet overall and some stained concrete is taking share from commercial,” said Michel Vermette, president, Mohawk Commercial. “You are definitely seeing [stained concrete] in retail and some corporate spaces, especially tech companies. At Google, Amazon and Nikon you see concrete. The floor is a bit louder; to compensate, they try to put some soft surfaces around it.”

Carpet tile now represents 60% of the commercial carpet market, and executives do not see that trend reversing anytime soon, as modular is easier to install and is the floor of choice for most commercial environments vs. broadloom. However, there is long-term hope for broadloom in office settings, executives said. That’s because new, open office spaces—table settings vs. cubes—are emerging where it is easy to move furniture pieces around, which in turn changes the whole installation thought process. As Vermette explained, “You could see—and I’m not saying it is going to happen—but where broadloom makes inroads in this space as it becomes an easier, simpler install because you don’t have all the lift in this space; maybe over time I may not have to spend as much; carpet tile is more expensive than broadloom. So, if you want a clean aesthetic, broad- loom could be a trend.”

Corporate and government sectors are also changing their environments, opting for less traditional spaces in favor of open and collaborative spaces. “Flooring solutions that help define separate spaces—such as carpet tile, which allows for different designs, color accents and patterns—help achieve that desired workspace,” said Bob Chandler, executive vice president, commercial division, Shaw Floors.

Among commercial segments, education saw a late surge in 2017 as bond money began flowing through the system. The full effect of that trend will be seen in 2018 and beyond. Broadloom also remains a viable alternative in segments of hospitality even though hard surfaces are making significant inroads, especially in renovations and boutique hotels.

While carpet tile continues to grow in the commercial space, it has never found a pathway to the residential segment. Some executives say carpet tile’s window of opportunity in the home—if it ever had one—is closed for good.

Fibers
In 2017, nylon continued to lose share to PET/polyester and has virtually been wiped out of the builder market. There is also consistent “deselection” in multi-family, observers say, in favor of polyester. On the retail side, soft nylon is favored at the upper end of a differentiated market; however, nylon is under immense pressure in the middle markets of residential. Despite the fact consumers have high expectations for soft nylon, it has not done well as a soft-performing product, according to industry observers.

Meanwhile, the rug business continues to be a bright spot in soft surfaces, with 2017 marking the third year in a row in which it has had a higher sales increase than carpet. Rugs continue to track through what some call a “remarkable” channel shift, largely away from the independent flooring dealer. These days you’re just as likely to see rugs in a Bed Bath & Beyond or on Wayfair than you will in an independent dealer’s showroom. In fact, by some estimates, rugs are only represented in 8% of specialty flooring dealers’ showrooms.

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Housing: Single-family starts, rising home values provide shot in the arm

June 26-July 2, 2018: Volume 34, Issue 1

By Reginald Tucker

 

By many accounts, 2017 was a stellar year for residential construction—the best since 2007, some observers say. That’s due in large measure to robust activity in the single-family sector, which serves as a general barometer reflecting the health of the U.S. housing market.

According to the U.S. Census Bureau, housing starts reached a post-recession annual high of 1.203 million units in 2017—the most in a calendar year since 2007. As expected, single-family

led the charge, climbing more than 8.5% from 782,000 units in 2016 to 849,000 in 2017. By comparison, multi-family starts fell 10% from 380,700 in 2016 to 342,400 last year.

Figures supplied by the National Association of Home Builders (NAHB) showed housing starts in the South region accounted for the bulk of new builds, rising 2.5% from 585,000 in 2016 to nearly 600,000 last year. The West region came in second with 313,000 starts, a 7.5% uptick over 2017. Starts in the Midwest fell 1% to 180,000 units, followed by the Northeast, where starts dipped 4.3% to 111,000 units.

While 2017 was
the best year for homebuilding in a
decade, much of
the inventory
crunch confrontinghomebuyers over
the past two years
is reflective of the
dearth of homebuilding since the recession, according to Trulia, which tracks new home sales, construction trends and real estate interests.

To put the past year into perspective, permits, starts and completions relative to the U.S. population were just 64.9%, 58.8% and 57.9%, respectively, of the 50- year average.

Total housing starts was not the only metric on the rise. The value of the entire U.S. housing stock increased by 6.5%, or $2 trillion, in 2017, according to a report from Zillow. Homes in the United States are now cumulatively worth $31.8 trillion.

The gain in home values was the fastest since 2013, when real estate was in the early stages of its recovery from the Great Recession. Los Angeles is the most valuable U.S. housing market, valued at $2.7 trillion, according to Zillow’s estimate of owner-occupied and rental homes, while New York, valued at $2.6 trillion, came in second. By Zillow’s count, the 10 most valuable metropolitan areas are worth $11.3 trillion combined, or 36% of the total value of the U.S. housing stock.

According to the National Association of Realtors (NAR), the national median existing single-family home price in the fourth quarter was $247,800, up 5.3% from a year ago. Ninety-two percent of the markets measured by NAR saw an uptick in single-family home prices, while 26 metro areas, or 15%, saw double- digit increases. Home prices are now at their all-time high in 64% of the markets NAR tracked.

“A majority of the country saw an upswing in buyer interest at the end of last year, which ultimately ended up putting even more strain on inventory levels and prices,” noted Lawrence Yun, NAR chief economist. “Remarkably, home prices have risen a cumulative 48% since 2011, but incomes are up only 15% during that time frame. In the West region, where very healthy labor markets are driving demand, the gap is even wider.”

How that trend bodes for 2018 and into 2019 remains to be seen, observers said. Among other things, they point to the new federal tax law that reduces key benefits to home ownership. This includes a lower limit on the amount of debt eligible for the mortgage-interest deduction and a cap on state and local tax deductions. Those changes, critics say, will likely land hardest on home- owners in coastal markets with high property values (and taxes) and could lead to price declines, according NAR.

Mid-year report
The momentum generated in 2017 has spilled over into this year. Statistics provided by the U.S. Census Bureau show newly built, single-family homes rose 6.7% in May—the most recent period for which reliable numbers are available—to a seasonally adjusted annual rate of 689,000 units. (A reading of 689,000 units translates to the number of homes that would sell if this pace continued for the next 12 months.) More importantly, this is the second-highest sales report since the Great Recession. Throw multi-family starts in the mix and total housing starts rose 5% in May to a seasonally adjusted annual rate of 1.35 million units, the highest since July 2007. (The May reading of 1.35 million units is the number of housing units builders would begin if they kept this pace for 12 months.)

“Sales numbers continue to grow, spurred on by rising home equity, job growth and reports of a greater number of millennials entering the single-family housing market,” said Randy Noel, NAHB chairman.

Robert Dietz, NAHB chief economist, agrees, adding that ongoing job creation, positive demographics and tight existing home inventory should spur more single-family production in the months ahead. Year-to-date, single-family and multifamily production are up 9.8% and 13.6%, respectively, over the same period last year.

“We should see builders continue to increase production to meet growing consumer demand even as they grapple with stubborn supply-side constraints, i.e., rising lumber costs,” Noel explained.

One concern, however, is the dip in permits—the chief indicator of future housing production activity. This metric dropped 4.6% to 1.3 million units in May. Single-family permits fell 2.2% to 844,000 while multi-family dropped 8.7% to 457,000. From a regional review, permits rose 42.1% in the Northeast and 7.2% in the Midwest, but fell 4.6% in the West and 13.9% in the South.

“The softening of single-family permits is consistent with our reports showing builders are concerned over mounting construction costs, including the highly elevated prices of softwood lumber,” NAHB’s Dietz noted.

Meanwhile, the inventory of new homes for sale was 299,000 in May, which is a 5.2-month sup- ply at the current sales pace. The median sales price was $313,000.

“We saw a shift to more moderately priced home sales this month, which is an encouraging sign for newcomers to the market,” said Michael Neal, NAHB senior economist. “Since the end of the Great Recession, inventory has tracked the pace of sales growth. While we expect continued gains in single-family housing production, inventory may be partially constrained by ongoing price increases for lumber and other construction materials.”

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Scoring flooring: Industry stats for 2017

June 26-July 2, 2018: Volume 34, Issue 1

The flooring industry in 2017 continued its prolonged climb back from the economic slump that plagued the United States from 2007-2010, led by the resilient category in general and everything waterproof in particular. While growth rates pale in comparison to the mid-2000 heydays, the industry last year continued to post steady gains across the board with increases of 3.85% in dollars and 3.2% in volume. This comes on the heels of 5.1% growth in dollars and 3.8% in volume in 2016; 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, 2017’s figures represent the eighth consecutive year of dollar growth and sixth straight year of volume increases.

FCNews’ exclusive research reveals total 2017 flooring sales topped out at $21.990 billion and 19.736 billion square feet. (These numbers are in wholesale dollars reflecting the first point of sale. They also do not include stone flooring, nor does it account for ceramic wall tile, cove base and rubber accessories.) 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 9% and 25%, 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 35.8% in dollars and 18.7% in volume. The greater growth in dollars is a reflection of consumers buying more expensive goods along with a series of price hikes, particularly on the carpet and hardwood sides. Perhaps even more significant is total industry sales approaching $22 billion, a plateau that has not been reached since 2007, when sales were $22.337 billion. Volume is also fast approaching 2008’s 19.905 billion square feet. But keep in mind that 10 years ago, FCNews included cove base and accessories in its rubber flooring numbers. Last year we made the decision to include only sheet and tile flooring in our rubber numbers and only adjusted back to 2012. In the absence of that change, 2017’s numbers could have eclipsed 2007’s sales and 2008’s volume figures.

The average selling price of all flooring in 2017 was $1.11 (the same as 2016 and 2015, and up $0.02 from 2014 and $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. Eleven years ago, the average selling price for all resilient flooring was $0.64. These past two years it has been $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 28.8%, down from 33% in 2016. The increased usage of the higher-cost LVT, both residentially and commercially, and now WPC have been industry game changers. But it’s not just resilient. The average ceramic tile price has increased from $0.95 to $1.19 a square foot over the last 10 years, and hardwood has seen an average-square-price jump from $2.21 to $2.49 per square foot. Even the maligned soft surface segment—which has seen its share of the market dip from 64% in 2007 to 51.8% in 2017 (and down from 53.7% 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 $1.32 a square foot in 2007 to $1.09 in 2016. It dipped a half-cent in 2017 to $1.085. Laminate is also the only category in 2017 to show a decline in both dollars and volume, primarily due to lower domestic production capacity in 2017 and the growing popularity of WPC, ceramic tile and lower-priced wood and bamboo flooring. 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. While it continues to rebound and grow each year, housing starts are still below the 1.4 million threshold that is considered normal. 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.

But there have been many positives. The U.S. economy continues to grow as consumer spending (due to rising employment) and household income (and with it, disposable personal income) are on the rise. Commercial construction continues to rebound, and corporate pre-tax profits grew in 2017 after a sub-par 2016.

Also, not to be underestimated as a flooring market driver, is an aging baby boomer population. Boomers control the lion’s share of this country’s disposable income and are in their prime spending years. Many are buying second homes, or at the very least transitioning into different places of residence.

Much like the past few years, the resilient category continues to be the locomotive powering the industry and WPC the catalyst for this explosive growth. In 2017, resilient posted the largest percentage gain of any flooring category, rising 14.1% to $3.993 billion from $3.499 billion in 2015. Since 2010, the category has increased a stunning 132% and is now is at its highest point in history in terms of dollars. Interestingly, it has “only” increased 68.1% in volume, again accentuating the migration from felt to fiber-glass sheet, along with the transition from residential/ commercial sheet and VCT to LVT and WPC.

In the grand scheme of things, resilient now accounts for 18.2% of the total flooring market in dollars (up from 16.5% in 2016) and 20.4% in volume (up from 18.8% in 2016) after a 13.8% rise in units to 4.024 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 and 18.8% in 2016.

FCNews research reveals just how much LVT—along with its sub-category, WPC/rigid core—is driving growth of the segment. LVT sales have gone from nearly $750 million in 2012 to $2.685 billion in 2017. That means the category has grown two-and-a-half timesin five years. But it is no longer sufficient to strictly talk about LVT. WPC/rigid core has taken on a life of its own with 2017 sales of $936.3 million (92.4% residential) and 480.25 million square feet (93.1% residential). To put this in perspective, WPC/rigid core now comprises 34.9% of all LVT and 45.8% of all residential LVT sales in dollars. In terms
of volume, WPC/rigid core constitutes 25.9% of all LVT and 31.8% of all residential LVT. And at $1.95 per square foot, it is the most expensive resilient flooring product aside from linoleum and rubber.

LVT in general also carries with it a premium price tag as it comprises 63.8% of the category’s dollars but only 45.5% of its volume. To illustrate its growth, those numbers were 37.4% and 20.6%, respectively, in 2012.

LVT increased significantly in both residential and commercial markets—dollars and square feet—in 2017. Residential LVT saw a 32.6% increase in square footage from 1.04 billion in 2016 to 1.379 billion (including WPC/rigid core), making up 74.2% of the LVT market. This number was 76% a year ago and 71% 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 in 2015 to 326.3 million square feet (9.8%) in 2016 to 478.6 million square feet, a 46.7% increase. This can be attributed to many commercial carpet mills (Bentley, Milliken, Interface and others) getting into the LVT game through third- party sourcing from companies like Nox and Gerflor, not to mention organic growth from the likes of Shaw/Patcraft, Mohawk, Mannington and Armstrong. While residential brought in significantly more dollars—$1.888 billion—last year, commercial LVT still performed well, posting a 22.9% increase, rising from $648.6 million in 2016 to $796.5 million in 2017.

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 multitasking 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 sur- face 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, which today is only 7.5% of resilient dollars and 13.6% of volume. Five years ago, those numbers were 19.7% and 26.8%, respectively. But it is also nipping from sheet vinyl as well. Sheet vinyl—residential and commercial combined—has grown only 1.5% in the last four years, going from $791 million in 2013 to $803 million in 2017. It actually was down 0.8% from $809.6 million in 2016. Residential has led the way here, but if not for the rebound in new home construction and manufactured housing, sheet vinyl would surely have shown a more precipitous drop. The commercial market has taken the bigger hit, declining 11.9% in dollars from $254.24 million in 2013 to $224 million in 2017. The category has been a challenge for just about everyone, with heterogeneous continuing to take share from homogeneous, which really has only three players remaining: Armstrong, Mannington and Tarkett. On a more positive note, commercial sheet was flat in 2017 on the heels of 1.2% and 1.4% declines in the two prior years. It remains a mainstay in healthcare, where a more seamless floor covering is demanded.

Sheet has been the perennial volume leader in residential resilient sales, but it is losing its stronghold with the growth of LVT, particularly the WPC/rigid core sub-segment. Last year, sheet vinyl maintained a 42.3% share of the residential market, down from 47% in 2016, 55.1% in 2015 and 60.2% in 2014, but it comprises only 22.4% of dollars, down from 26.7% in 2016 and 38.9% in 2015. And if one is to group LVT and WPC together, residential sheet loses its volume leadership by nearly six percentage points. Sheet is also a favorite of homebuilders, which favor its ease of installation, attractive styling and good value.

Carpet
It was a year of change for the category in 2017 as two longstanding mills vacated the market, including former No. 3 player Beaulieu, which was acquired by Engineered Floors out of bankruptcy. Last year also saw multiple rounds of price increases as companies contended with increases in raw material costs. In the end, carpet sales rose a scant 0.6% to $8.83 billion while volume inched up 0.4% to 11.265 billion units.

For the second year in a row, residential outperformed commercial. In fact, carpet volume was down 6% by some estimates in the commercial sector, while sales fell about 3%. Residential carpet sales, meanwhile, increased 2.5% while units were a tad lower. The sales increase was helped by the trend toward better goods in the marketplace as well as several rounds of increases that took place over the course of the year.

Overall, carpet and rugs make up 57% of the flooring market in terms of volume, still the largest percentage of any flooring surface, yet down from its dominant days of a decade ago when it commanded 66.9% of the industry.

Carpet is still expected to lose share to hard surfaces in 2018 and perhaps future years, but there is sentiment that the slide will at least slow down. Industry observers cite two rea- sons: today’s technology is producing luxuriously soft carpet that is also durable and stain resistant, and consumers have shown the inclination to invest in the better goods, even if it is just for their bedrooms. Second, and perhaps more importantly, an aging population prefers softer, warmer surfaces, according to studies.

Carpet tile, although strictly a commercial product, now represents 60% of the soft market in commercial and continues to grow across most sectors. Rugs is another soft product that has enjoyed a resurgence, albeit with the help of hard surface’s growth. While rugs increased an estimated 3.4% in 2017, most of that growth is not occurring in the specialty retail channel. After three years of relative flatness, carpet sales—at least residentially—are expected to climb a few percentage points in 2018, a reflection of the strong economy and improving housing market.

Ceramic
“Let the good times roll” could be the theme for the ceramic tile category, which has posted eight consecutive years of growth, including jumps of 5.8% in sales and 5% in volume in 2017—the second-largest segment gain next to resilient. That growth translated into ceramic tile sales of $2.921 billion last year, the third-highest amount of all floor coverings and the second-largest sales volume with respect to hard surfaces. The ratio was much the same with respect to volume, as the amount of ceramic tile sold at the first point of distribution hit 2.426 billion square feet—second only to resilient.

As much as any category in flooring, ceramic has a symbiotic relationship with housing. When housing metrics are positive, the ceramic business usually follows suit. Looking at the overall U.S. economy in 2017, gains in the construction and housing markets, as well as historically low interest rates and falling unemployment, lifted ceramic tile to its third straight year of 5% growth or better.

Much like carpet and resilient, ceramic tile consumption is closely tied to housing activity. One industry consultant told FCNews housing starts fell by 70% during the recession, and during that period ceramic tile sales plummeted by more than 30%. Now that housing starts are progressing at a moderate pace, ceramic tile is participating in the resurgence.

While the ceramic tile market has grown eight consecutive years and bears little resemblance to the 2007-2009 period, when sales and volume each fell 20% or more in consecutive years, its growth has been constrained to some extent by a continuing shortage of labor and, to a lesser extent, the massive growth of LVT and its sub-segments. Still, most executives believe ceramic will continue to grow in the mid-single digits— and possibly higher—in the years ahead.

Wood
The hardwood flooring category—the fourth-largest sector behind tile—also posted respectable numbers last year, largely due to strong residential replacement activity as well as continued consumption by the new home construction sector. FCNews research shows wood sales at the first point of distribution climbed to $2.32 billion in 2017, a 4% increase over 2016, while volume shipped increased 3.6% to 930 million square feet. Like resilient and ceramic, the closing gap in the ratio of percentage growth of sales to volume reflects greater movement of more expensive materials (i.e., advanced multi-ply engineered floors as well as higher costs due to price increases).

With hardwood’s performance in 2017, the sector now accounts for nearly 10.6% of total industry sales. When compared to total hard surface sales, wood’s share expands to more than 17%. On the volume side, however, it represented only 4.7% of total industry square footage shipped, but 11% of all hard surfaces sold in 2017.

A closer look at the end-use channels helps explain the growth trend. In 2017, residential replacement and new construction end-use markets accounted for 55% and 35%, respectively (or 90% collectively), of hardwood flooring sales. That’s up slightly from 2012, when new residential and residential replacement represented about 83% of category sales. One of the biggest shifts over that time period occurred in the commercial sector, which— including specified contract and Main Street market applications—accounted for 17% of sales. Last year, contract commercial and Main Street represented just 10% of sales, research shows.

While industry research along with anecdotal evidence shows competing hard surface categories seem to be growing at a faster pace, wood has not ceded its position relative to its ranking among the likes of tile, resilient flooring, WPC, etc. For example, wood represented the third-largest hard surface category in terms of dollars in 2017, trailing only resilient (18% market share of total industry sales) and tile (13.3% of total sales). Back in 2007, wood was also the third-largest hard surface category—although resilient and tile represented a much lower portion of the overall pie at 9.8% and 9.3%, respectively. Ten years ago, wood held a 9% share of the market.

Laminate
The one category that did not experience year-over-year growth in both sales and volume in 2017 was laminate. FCNews research shows sales of laminate in the U.S. fell 2.7% to $1.1.23 billion with volume shipped at the first point of distribution to 1.034 billion square feet, down 1.9% compared to 2016. Industry observers cite, among other factors, a shift in imports and the loss of significant domestic capacity when one major supplier closed its U.S. laminate operations.

The 2017 falloff in laminate flooring sales put the category totals at their lowest level since 2013, when sales reached just over $1.12 billion before rising each year for three consecutive years. Likewise, the volume of laminate flooring sold hit its lowest point since 2011, when shipments totaled 1.02 billion square feet. The contrast is even more pronounced when comparing last year’s activity to laminate’s performance 10 years ago; at that time, U.S. sales hit $1.169 billion, with volume reaching roughly 970 million square feet. While laminate still exceeds hardwood in the volume department (albeit slightly), the category is among the lowest in terms of price per square foot. In fact, the segment has not seen much movement beyond the $1.08 per square foot wholesale price point since 2010. Meanwhile, competing products such as resilient and ceramic tile have seen their respective price points increase accordingly.

Observers are also seeing big boxes and discount merchandisers grow their market share. FCNews research shows Home Depot and Lowe’s increased their share of laminate sales to the tune of a combined 46%, up from 42% in 2017. That’s in keeping the big-box giants’ market share of laminate sales in 2012.

 

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Active families are no match for RevWood Plus

By Mara Bollettieri

Gabriel Rodriguez, manager of Carpet Liquidators, Everett, Wash., is in a unique position—he is both a retailer who sells Mohawk’s RevWood Plus flooring and a consumer who has used the product almost exclusively throughout his own home.

In many ways, Rodriguez fits the profile for the prototypical customer that Mohawk had in mind when it developed RevWood Plus. The store owner, along with his fiancée, have four pets (two cats and two dogs) and a 5-year-old son. A family of that size not only required a floor that can stand up to the rigors of an active household, but the owners also desired a product that was visually appealing. RevWood Plus’ waterproof attributes, trendy looks and All Pet Protection warranty—along with its ease of maintenance—proved to be the winning combination.

“The boards are made with Mohawk’s HydroSeal, which gives you the peace of mind for spills,” Rodriguez told FCNews. “There are LVT products out there that are waterproof, but LVT is not very strong. RevWood Plus has the best of both worlds.”

RevWood Plus’ highly touted scratch resistance, in particular, was a big draw for Rodriguez. Although his pets are house trained, there are occasional “accidents.” Then there’s junior, who often drips water all over the floors after bath time. But with RevWood Plus, Rodriguez is not at all concerned about water damage. “Not only does it look phenomenal, but it has just been holding up perfectly fine,” he explained. “I know the boards aren’t going to swell up, and I don’t worry that we’re going to have to replace all of the floors, which can cost a lot of money.”

True believer
There’s no shortage of laminate floors on the market that claim to be impervious to water damage. But Rodriguez knew he had a winner with RevWood Plus early on when he was introduced to the product by Mohawk reps who conducted training for his employees.

“They had this little display and they poured gallons of water onto it,” he told FCNews. “None of the water was getting through because the locking mechanism is

so tight; the boards aren’t exposed. I was like, ‘Wow, that’s a phenomenal product.’”

Rodriguez’s fiancée is pleased with the floor as well, but more so for its aesthetic appeal. “Since I’m more of the flooring guy, I’m the one who really focuses on the performance,” he said. “She just loves how it looks.

The design is really great, and that’s one of her favorite things.”

The Rodriguez family is so confident in RevWood Plus that the product is installed in almost every room in their new home. “It’s literally installed everywhere,” he said. “Every bathroom, every closet.”

 

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What retailers need to know about RevWood

By Reginald Tucker

 

When it comes to positioning RevWood and RevWood Plus for maximum sales potential, product placement is key. Rather than grouping the product in with competing laminate floors—many of which retail on the lower end of the spectrum—Mohawk is advising its dealer partners to aim high. In other words, place RevWood displays on a more level playing field right alongside other hardwood flooring displays in the showroom.

“We realize retailers may be a little hesitant to do that, but it goes back to simplifying the retailers’ shopping experience,” said Angela Duke, director of brand marketing. “Our research shows dealers should group all their wood and wood-based products together, then take the consumer through her shopping journey based upon her performance requirements, lifestyle and then the benefits and features she is seeking.”

As Duke explains: “We know consumers—especially those with active families who have pets and kids—are looking for some type of performance product but still want the high-end wood look. Now we’re able to show them RevWood or RevWood Plus. But if a consumer says, ‘You know what, I’m not really concerned about scratches but I’m looking for a natural hardwood product.’ Then we can take them to our TecWood line, which is our engineered hardwood product. So having them all grouped together is beneficial for the retailer.”

Options galore
Of course, it can’t hurt when you offer dealers a compelling package of styles and visuals to sell. All RevWood/RevWood Plus collections are designed to address consumers’ aesthetic needs while providing the durability, performance and value homeowners crave. Each collection features the latest embossed-in-register technology and beveled edges for ultra-realistic detail.

Following is a snapshot of the initial patterns and designs:

Elderwood: This collection is available in four trending colors with distinctive knots and grain patterns. Elderwood provides a choice of sophisticated oak visuals in 12mm planks measuring 7 ½ inches wide x 54 11⁄32 inches long.

Antique Craft: Five color options in time-worn hardwood looks available in trending soft brown and gray tones in longer, wider planks spanning 9 7⁄16 inches x 80 ½ inches.

Sawmill Ridge: An ensemble of reclaimed hardwood visuals in four fashionable colors that coordinate with a variety of today’s design

styles. Natural wood character is enhanced with deep texture to high- light knots and varied grain patterns. Plus, Sawmill Ridge features radial saw marks, adding a rustic charm inspired by vintage hardwood planks produced by the early sawmills. Planks are 12mm thick, 6 1/8 inches wide x 47 1⁄4 inches long. Dealer excitement surrounding the project launch is evident in the number of displays that have been purchased thus far. According to Duke, more than 1,200 merchandisers have been shipped since the official launch at Surfaces 2018.

Mike Fleming, owner of Carpet Liquidators in Seattle, is a fan. “We’ve had some early success with it,” he told FCNews. “The styles and colors are out of this world, and that’s why we’re selling it.”

With respect to product placement, Fleming chooses to straddle the line. “Because we are a stocking dealer, we put RevWood toward the front of the store with laminate but next to the engineered hard- wood,” he said. “I was concerned about the price point because it gets into the engineered wood category; however, the styling and colors are just spot on.”

Mike Lekocaj, co-owner of Niko’s Import-Export, based in Ma- comb, Mich., is also a believer in RevWood. “It’s a very good product. What I like in particular are the width and the length—9 inches wide x 7 feet long. That’s what’s doing well with consumers. Mohawk did a very good job with the colors.”

With respect to placement, Lekocaj, follows Mohawk’s recommendation. “We have it right next to the wood section,” he said. “The younger generation seems to like it; they don’t care as much if it is laminate or wood as long as it looks good.”

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Extolling the performance attributes of RevWood Plus

“Wood without compromise.” That’s the overarching tagline and driving philosophy behind Mohawk’s new RevWood Plus collection—the step-up product to the entry-level RevWood line.

In developing RevWood Plus—an offering loaded with bells and whistles designed to boost performance attributes for end users and profits for dealers—Mohawk took into account the challenge active families face when evaluating wood flooring as an option for their homes. Compared to solid wood flooring, RevWood Plus aims to provide the solution for homeowners seeking stylish wood options that can perfectly accent any room design—all while meeting expectations that it will withstand the wear and tear active families place on their flooring.

“RevWood Plus is the premium offering in the line while RevWood is the opening price point,” Angela Duke, director of brand marketing, Mohawk Industries, explained. “It has more premium visuals, longer/wider planks and more textures, while RevWood features more of the commodity-type visuals. However, both brands feature state-of-the-art technology and are made in the U.S.”

Mohawk created RevWood Plus to deliverthe look and feel of authentic wood but providethe toughness and durability associated withlaminate flooring. The product boasts the abilityto keep spills, accidents and tracked-in stainmakers on the surface for quick and easy cleanup. What’s more, it is billed as a waterproof flooring system that’s scratch resistant.

Several distinct attributes of RevWood Plus work in conjunction to form what Mohawk calls a complete waterproof system. From the Uniclic MultiFit locking system to Mo- hawk’s GenuEdge pressed beveled edge and HydroSeal perimeter coating, these innovations are designed to trap liquids on the surface of the floor, thereby preventing damage to the core. The waterproof seal is so reliable, according to Mohawk, that consumers can even regularly wet mop a RevWood Plus floor—something unheard of with traditional laminate floors.

“With RevWood Plus, we have taken performance to the next level,” Duke said. “The combination of HydroSeal, GenuEdge bevel technology and the Uniclic glueless locking system—which keeps water from seeping past the joints—makes a complete waterproof sys- tem. On top of that, we are able to offer All Pet Protection as well. The end result is a product that’s much easier for the consumer to maintain.”

Mike Fleming, owner of Seattle-based Carpet Liquidators, has only had the product for about three months. But he likes what he’s seeing so far. “The waterproof story is a great feature for customers to do a trade-up sale in laminate vs. the [cheaper] competition in laminate,” he said.

And thanks to RevWood Plus’ environmentally friendly construction, it’s also a product that allows the homeowner to sleep easier—literally. “RevWood Plus products are low in VOCs, so it contributes to good indoor air quality as well,” Duke stated.

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RevWood—what’s it all about?

A whole new spin on traditional wood flooring

By Reginald Tucker

 

A revolutionary engineered flooring product that combines the look and feel of authentic wood with the tenacity of laminate. That’s how Mohawk Industries describes its new RevWood and RevWood Plus lines—a pair of collections tailored for consumers who desire the aesthetics real hard- wood offers without the hefty price tag associated with high-end wood or the limitations associated with natural wood products.

In essence, RevWood is billed as a revolutionary wood flooring (hence the “Rev” in “RevWood”) that’s built to withstand the rigors of today’s active households. The product, which features a laminate decorative layer bonded to an HDF engineered core, is designed to resist stains, scratches and dents while still rendering a realistic hardwood visual. While RevWood does not usher in an entirely new flooring category unto its own, the positioning of the product is intended to challenge typical consumer notions of how they perceive traditional laminate flooring products and engineered hardwood flooring.

Back in early 2017, Mohawk conducted extensive consumer research—including targeted focus groups and surveys—to determine how shoppers discern the differences between the various hard surface flooring products available today. The company also wanted to find out what factors consumers consider when making their final selections.

“Specifically, we wanted to know what they thought about wood, vinyl and laminate products,” said Angela Duke, director of brand marketing, Mohawk. “We learned from consumers that their shopping experience can be very complex and frustrating. Our main goal is to make shopping for flooring very easy and simple to understand, and that’s precisely what we’re doing with the launch of RevWood and RevWood Plus.”

Consumers who participated in Mohawk’s focus groups reviewed samples of laminate, vinyl and wood planks, and they were asked how they would categorize each product. The results, according to Duke, were enlightening. “In the consumers’ minds, they put a natural divide between vinyl and wood—there’s really no middle ground here. But when they

looked at the solid wood, engineered wood and laminated wood samples, consumers put them all in the same group.”

Based on those findings, Mohawk saw an opportunity—and seized it. “We capitalized on what we learned, and that led to the creation of the RevWood and RevWood Plus brands,” Duke explained. “We know consumers understand there’s prestige in hardwood, but they also have a hard time justifying paying a lot of money for a solid hardwood floor—nature’s ‘gold’ standard. It represents the highest quality in the mind of the consumers, but it’s also the highest cost. But wood is not as durable or scratch resistant as laminate, so consumers don’t get all the benefits.”

Making the mental leap from laminate to hardwood was not as difficult for consumers, Duke argues, because of the way Mohawk’s laminate products are constructed. “Our laminate products are mostly made up of wood,” she noted. “It wasn’t a big challenge for us to put laminate and engineered wood in the same category because the consumer automatically did that for us.”

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NeoCon turns 50: Design, innovation take center stage at milestone event

By Lindsay Baillie

Chicago—NeoCon, one of the largest commercial interior design shows in North America, concluded its 50th edition last month, drawing in more than 50,000 attendees—a 5% increase from 2017. The Mart in Chicago was bursting with 140 showrooms, where roughly 350 exhibitors showcased the latest and greatest in corporate, hospitality, healthcare, education and retail design.

According to show management, the show floor was completely occupied, which was in keeping with NeoCon trends seen over the past 10 years. What’s more, flooring was the second highest represented commercial industry. “The fact that this was our 50th edition added a lot of buzz and energy,” said Byron Morton, vice president of leasing, NeoCon.

The scores of A&D professionals in attendance echoed those sentiments. “We could tell from the energetic crowds at The Mart that the excitement of NeoCon was at an all-time high this year,” said John Hopkins, principal and design director, IA Interiors Architects’ Chicago office. “We loved that there was such a focus on acoustic solutions—it’s an undervalued component when it comes to privacy, workplaces and open environments. We also noticed there were a lot of natural materials and finishes, a welcome return after the influx of the cold, industrial materials of the past few years.”

Angie Lee, AIA, IIDA, principal, design director-interiors, FXCollaborative Architects LLP, New York, agreed. “I have attended NeoCon for the last three years and continue to be impressed by the immense energy and creativity of the manufacturers, designers and associations. I saw a range of products implementing unexpected, thought-provoking uses of color, pattern and texture.”

Vendors attributed much of that enthusiasm to three primary factors—the strength of key end-use market sectors, the bevy of new products that provide both aesthetic and performance solutions, and positive trends in non-residential construction spending.

“Traditional hard surface markets like retail and healthcare still are very strong, and non-traditional markets such as offices and hospitality are shifting toward hard surfaces in many areas they did not consider before,” Robert Brockman, segment marketing manager, commercial, Armstrong Flooring, told FCNews.

LVT in particular is driving commercial flooring consumption across several end-use markets as it continues to exceed the growth of the once-dominant broadloom sector. This is especially the case in hotels. “Most hospitality end users are also looking to make a change to something more timeless in terms of pattern and color,” noted Al Boulogne, vice president, commercial resilient business, Mannington Commercial. “That, coupled with the easier maintenance requirements, make it an ideal product for these environments.”

But it’s not just hospitality that’s driving LVT specifications. Observers say healthcare holds the biggest growth potential for LVT, especially in areas such as hotel lobbies, hospital corridors and senior living spaces. “Slip/fall issues help LVT vs. other hard surface options,” said Paul Eanes, vice president of new business development, Metroflor.

Product trends
The vast array of innovative new products on display at the show reflected diverse requirements of architects, specifiers and designers. To keep up with demand, flooring manufacturers are developing new products across both hard and soft surface arenas that appeal to multiple commercial sectors at a time. In addition to developing products that fulfill “resi-mercial” demands, manufacturers are incorporating more pops of color to assist designers in creating unique, productive spaces.

In terms of hard surfaces, manufacturers continue to incorporate sustainable, biophilic design, with resilient flooring mimicking stone, cement, wood and other natural looks. Armstrong Flooring, for example, rolled out a heterogeneous sheet product called Mixers, which was inspired by the vibrant colors of different cocktails. Focused on its heterogeneous and homogeneous sheet lines, Armstrong presented attendees with new products that boast equal performance. “The update there is two fold,” Brockman stated, adding that designers can specify both sheet lines together without performance issues. “It’s not only new designs and patterns, but Diamond 10 technology has been added to the heterogeneous line.”

New to NeoCon, Cleo Contract—a Congoleum brand—highlighted its non-vinyl, non-PVC product. Made up of 85% limestone, Cleo has an ultra-low VOC, high-performance clear coating for durability and performance. What’s more, its visuals are digitally printed, which allows the company to produce custom looks. To help designers show what the product looks like after a complete install, Cleo Contract developed digitally printed papers that can be updated in real time with the current SKUs, according to Kurt Denman, chief marketing officer and executive vice president, sales, Congoleum.

Also riding the non-vinyl train is Mannington Commercial with its latest non-vinyl alternative resilient tile, Cirro. Offered in 20 visuals and four different sizes in tile and plank formats, Cirro can be installed using traditional resilient adhesives.

Also new from Mannington is Northern Wonders, which was inspired by a designer’s visit to see the Northern Lights. “Its colors and design are a culmination of ideas developed during the trip,” said Whitney LeGate, business manager, commercial LVT, Mannington. The product is available in nine colorways.

Over at the Karndean Designflooring space, the emphasis was on designer education as well as the seemingly endless options available through its Korlok, glue-down and loose-lay products. The company’s grout strips, available in 16 colors, were installed in the booth to show how to incorporate fake grout lines as well as pops of color to a SKU. “We’ve expanded our solid color offering to allow for both bold, saturated pops of colors and pastels to align with 2019 color forecasts, great for projects that require an elevated brand identity or to add a bit of whimsy,” said Jenne Ross, director of marketing. “We’re excited that these custom colors will be available on-demand and custom cut at our Pittsburgh facility.”

One of the products Raskin Industries showcased was Ceramix, a resilient tile with built-in grout lines that’s available in a variety of visuals, including stone, marble and concrete. “We have 36 x 36 tiles that give you a really clean smooth concrete look,” said Ted Rocha, vice president of sales. “It would be something that you’d see in an Apple store, for instance.”

Aspecta released its Aspecta 10 line, a premium multi-layer flooring with Isocore technology. The new offering features a 28mil wear layer and can be installed floating corner to corner—thanks in part to its innovative vertical locking system. “This is the Rolls Royce of multi-layer flooring,” said Marcel Kies, global CEO, Aspecta. “What we’ve tried to create is a good, better, best product.”

Shannon Specialty Floors displayed its new Naturescapes line, which was designed with the help of Jason McLennan, author, founder and creator of the Living Building Challenge. Naturescapes, he explained, is a resilient flooring product made with organic polymers. “It’s not vinyl, it’s free of all Red List chemicals and it’s the first Living Product Certified resilient flooring in the industry. This product class is highly sought after.”

Roppe highlighted multiple products at the show, including its Northern Parallels Chevron LVT planks available in a 9¼ x 59¼ format in three color ranges. According to Dee Dee Brickner, marketing manager, the line reflects strong demand for one of the most popular patterns—a directional pattern that’s often seen in real hardwood installations. “By offering a left and right design, these floors can also be laid in the same direction to create another unique look by using only one side.”

Looking beyond LVT, manufacturers in the rubber segment also looked to generate some buzz by showcasing products in on-trend, vibrant colors. Suitable for multiple applications, these manufacturers have developed customer cut and base profile programs to provide designers with greater options.

Then there was American Biltrite’s AB Pure, which features its signature Nfuse technology (Here, the coating that is applied directly into the flooring.) “Normally you would take [a rubber floor] out of the box, glue it down and then you’d scrub and clean it to release the mold agent,” Mark Tickle, director of marketing, explained. “With AB Pure, once you lay it down you use a damp mop on the surface. Then as soon as the adhesive has cured you can have people on it.”

Flexco is incorporating different wood-look visuals as well as new rubber plank sizes to its portfolio. “We’re also going to be launching some of our new base profiles, which is catching a lot of people’s interest,” said Haley Plank, marketing manager. “We’re also working on sustainability for our products. We have two new HPDs coming out for our rubber tile and treads.”

Procedo Flooring’s new Maxime rubber flooring line—available in eight colors in a 24 x 24 tile format—was designed to be installed across multiple settings, including educational facilities, sports facilities and retail areas. “We also started doing water jet cuts on the product for greater design options,” said Pierre Lefort, national sales manager.

All shapes and sizes
“Some of the coolest things in floor covering,” noted NeoCon’s Morton, “has to be the different shapes and textures” on display at the show. To that end, Tarkett showcased several products ranging from Pentagonals, which won a Best of NeoCon Gold, and Woven Fringe, a Best of NeoCon Platinum winner.

According to Terry Mowers, vice president chief creative officer, Pentagonals features rubber in a way that highlights a wide range of design possibilities. “You can get whatever color palettes you want within the system and a variety of shapes.”

Woven Fringe complements Tarkett’s rubber offering by providing a resi-mercial solution that is part of the company’s area rug program. According to Mowers, the product’s neutral color palette fits right in with current trends. “We’re seeing grays moving to healthcare in combination with other colorings. We’re also seeing grays getting warmer but we’re not seeing them move that far away.”

As hard surfaces continue to gain more share across various commercial markets, end users are incorporating more area rugs in their designs. At the same time, carpet tile is also gaining steam. New soft surfaces continue to follow sustainable, biophilic design while brightening up spaces with hints of color.

Case in point: Aquafil’s booth displayed clothing and carpet featuring Econyl fiber. According to Kathy Long, brand communications manager, the booth was designed to show how fashion and carpet flow together. “We’re trying to show the endless possibilities of Econyl,” Long said. “We have 28 new colors to the Econyl collection—new neutrals and pops.”

Patcraft highlighted Dichroic, a PET carpet tile made from recycled plastic bottles. “We’ve worked on two products to pull plastic waste out of the environment,” said Kieren Corcoran, director of performance markets. “We’ve taken the bottle chip that can’t be recycled and turned it into fibers. We can then recycle it again at the end of its life back into pellets.”

EF Contract, which made its NeoCon debut, highlighted several carpet collections, including Rust Dye. “What we did was take metals and went through the process of rust dying them and capturing what they leave behind as they decay,” Susan Curtis, vice president, design and marketing, explained. “We’re all about tile, skinny planks and giving the designer flexible to design their own patterns.”

New to Mannington’s broadloom products is Moire, a carpet tile offering developed in conjunction with installation artist Gabriel Dawe. Moire mimics an installation Dawe completed in The Mart, which featured 30 miles of colorful fiber organized in prism format. Interestingly, the installation changed its colors as attendees passed by.

Mohawk put the spotlight on several new soft surface offerings, including Sunweave, a collection of woven broadloom and rug products featuring Heathered Hues Duracolor premium nylon, and Crafted Convergence, which draws on influence from Native American pottery and baskets to everyday Japanese and African garments. “With Crafted Convergence, we’re starting to transfer more hospitality looks into the workplace,” said Mark Oliver, vice president, workplace and retail. “The other beauty is it’s broadloom, but we’re also offering it as a rug.”