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Laminate: Global markets offer advantages, obstacles

June 9/16, 2014; Volume 27/Number 29

By Ken Ryan

Screen Shot 2014-07-10 at 10.37.33 AMWhile laminate flooring at the lower and middle price ranges today is largely the domain of home centers, suppliers that can bring stylish higher-end products and upgrades to the market can still make money for their retail partners, flooring professionals say.

Indeed, the importance of selling quality laminate flooring is essential to ensuring customer satisfaction, repeat buyers, minimal returns and increased profits.

“The reputation of the company you are dealing with is really the key factor for the retailer,” said Bill Dearing, president of the North American Laminate Flooring Association (NALFA).

Whether the product comes from the U.S., Europe or China, it brings with it certain advantages and obstacles.

While the trend is toward more domestic sourcing and manufacturing across all flooring categories, including laminate, Europe and China offer advantages as well.

 

Domestic

The advantages U.S. suppliers enjoy is rather obvious: proximity to market, lower transport costs and shorter lead times. These are major benefits as retailers often cannot accurately predict demand, or whether they will need product quickly. In this sense, both Europe and China are at a disadvantage in time-to-market response when selling products in the U.S.; one way to compensate is carrying significantly more inventory than their U.S. counterparts, but that can be costly.

Manufacturers point to three core advantages to sourcing domestically: style/design, service and quality. Mannington, for example, uses local designers who can devote large amounts of time to researching home fashion trends specific to the North American market and then design the products with that consumer in mind.

The ability to deliver product on a timely basis is where domestic production wins. “When we go out of stock on a pattern, we can generally turn it around in days, not the months you have to wait while it goes through production and then sits on a boat coming across the ocean,” said Dan Natkin, director of hardwood and laminate products for Mannington.

Quality control is another potential game-changer for domestic suppliers. China has no third-party organization that oversees the quality control of laminate products the way NALFA and Europe’s EPLF do. For example, to bear the NALFA seal, laminate floors must pass 10 performance tests that evaluate water resistance, exposure to light, stains and whether a floor can be damaged when a large object is dropped on it or a castor chair comes in contact with the floor.

“All of our laminate products are certified to the NALFA standard,” Natkin noted.

There are seven other regular members of NALFA: Columbia Flooring, Kronotex USA, Mohawk, Pergo, Quick-Step, Shaw Industries and Torlys.

 

Screen Shot 2014-07-10 at 10.40.35 AMEurope

Laminate technology emanated from Europe, which it is still viewed by some as the technology epicenter. “The leaders in technology remain in Europe, as they were first in the business,” said Derek Welbourn, CEO of Inhaus, the North American marketing arm of global laminate manufacturer Classen.

Market share for laminate flooring in Europe exceeds 14% of total flooring sales compared to approximately 5% in North America. Furthermore, there is a large volume of major manufacturers in Europe, and the companies that have stayed in business have invested heavily in capital equipment to remain competitive against their peers.

“In our case with Classen, we have invested hundreds of millions of Euro and continue to invest annually in new capital equipment,” Welbourn said. “Improvements in [productivity], design and flexibility—the ability to offer a greater range of products without curbing efficiency—drive our investments.”

Welbourn said North American companies have invested less than their European counterparts and entered the business at a later date, meaning it didn’t make financial sense for them to invest heavily like European laminate companies. “The manufacturing equipment in North America for laminate flooring is efficient but not at the same level of automation and scale that is done in Europe. As an example, the Classen factory, just outside of Berlin, has a theoretical capacity of over 1 billion square feet per annum following our latest expansion. This means we would need between 85% to 95% market share to sell out the factory in North America.”

Executives said Europe has traditionally focused more on production costs than design. But that is changing, Welbourn noted, as innovation in technology such as embossed in register and digital printing make smaller and more efficient production runs possible.

According to Welbourn, it is still a major investment to create a new design, estimating the cost of print cylinders, paper, press plates and inventory at roughly €100,000 ($135,860). “Digital printing has the possibility to change this, but it has not become mainstream yet.”

In the meantime, the laminate industry globally is evolving into a more design savvy field. Pastels and oiled surfaces that were already popular in Europe are now also in demand in the U.S.

 

China

Chinese manufacturers are generally one to two years behind American and European trends as Asian companies “wait to see which designs will work in their market—frequently by copying our products,” Natkin explained.

Screen Shot 2014-07-10 at 10.46.57 AMChina is well known for being adept at copying things quickly, and product design is no exception. “And with excellent designers available to hire as outside developers, good designs are being made available in China,” Welbourn said.

Chinafloors, which was was founded in 2004 as a Belgian-Taiwanese joint venture based in Shanghai, has since grown into a flooring innovator.

Thomas Baert, co-owner of Chinafloors, said perceptions of China as a producer of cheap product still exist. But, according to Baert, that view is antiquated. “The reality is China has become a leader in specialty and innovative products and product development,” he said. “It is also a reality that we now see manufacturers in other leading countries copying the product ideas and product initiatives coming out of China.”

China does, in fact, have a major labor advantage over the U.S. and Europe (a vast population hired at cheaper labor rates), but a disadvantage in the lack of sophisticated equipment available in the market.

Dearing said there are some large distributors that purchase a great deal of Asian laminate from reputable vendors. “These distributors know their way around and they know what to buy,” he said. If a flooring dealer engages with a Chinese supplier to buy containers, Dearing noted that the margin “better be good, because what happens if something goes wrong?”

NALFA has always advised dealers to know their sources, Dearing said, making sure they are reputable to the point where they will be accountable if something goes wrong. “In this game you are playing with a lot of money; therefore, it is probably a better idea to deal locally, where you have a real sense of what the product is.”

Natkin added, “When and if there is an issue with a product, we stand behind the product and you know who to call. Can you say the same about an imported product?”

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Clarion Laminates joins NALFA as Regular Member

Screen Shot 2014-04-23 at 12.52.48 PMWashington, D.C. — Clarion Laminates, a made in the USA laminate manufacturer, is the newest Regular Member of the North American Laminate Flooring Association (NALFA). NALFA offers three levels of membership–Regular Manufacturing Membership, Associate Membership and Testing House/Lab/Academic Membership.

“Clarion Laminates is a great addition to our regular membership,” said Bill Dearing, president of NALFA.  “The company is committed to advancing the laminate industry, streamlining and perfecting processes every step of the way.”

Including a board and laminate plant on one site, Clarion Laminates demonstrates the efficiency of vertical integration and progression of laminate manufacturing. Their dedication to quality exemplifies NALFA’s mission to represent and promote the very best in the industry, making the recent partnership with NALFA invaluable.

“Clarion Industries has significant interest in the advancement of laminate flooring as a category and in the promotion of North American manufacturing when possible,” said Michael Babula, chief marketing and sales officer, Clarion Industries. “We look forward to working with the NALFA organization and its member companies to achieve these goals.”

Shippenville, Pa.-based Clarion Laminates operates under parent company Clarion Industries. This privately owned company manufactures high quality MDF (multi density fiberboard), HDF (high density fiberboard) and laminate flooring. Clarion Industries said it is the only fully integrated laminate flooring operation in North America, with a panel facility and laminate flooring plant on the same site.

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State of the industry: Laminate holds its own at the sweet spot

Screen Shot 2014-03-10 at 10.31.19 AM

Volume 27/Number 21; March 3/10, 2014

By Jenna Lippin

The expression “no news is good news” proves to be true when considering the laminate flooring market in 2013. The consensus among industry executives suggests the category posted low single-digit increases in both dollars and square footage, contradicting the sentiment on the part of some that laminate is about to be placed on the endangered product list.

Thanks to improvement in the U.S. housing market, refreshed product design and rising hardwood prices, laminate is firmly holding its place in the market. “There’s been a revitalization of the category,” said Dan Natkin, Mannington’s director of hardwood and laminate. “We’re doing things with visuals that we weren’t doing five to 10 years ago. Also, price increases in hardwood have helped create a spread between upper-end laminates and low-end woods. From my own experience, from retail or builder, you can get entry-level oak or a nice laminate at one price, and on the showroom floor people are choosing laminate.” Continue reading State of the industry: Laminate holds its own at the sweet spot

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NALFA names Lammy Awards winners

NALFALas Vegas — The North American Laminate Flooring Association (NALFA) named the winners of the 2013 Lammy Awards, recognizing companies and individuals for excellence in the laminate flooring industry.

2013 Winners:

Member of the Year, Jane Winters, Unilin-Mohawk

Associate of the Year, Gary Palmer – Pregis

Distributor of the Year, Elias Wilf

Retailer of the Year, Lowe’s

Associate Member of the Year, Selit

Member Company, Quick-Step

Some statistics mentioned during the ceremony in Las Vegas include estimated 2013 sale volume in square feet at just over 1 billion, with sales of $1.06 billion. Estimated cost per foot was up 3%.

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Mohawk, Quick-Step, Pergo, Columbia at NALFA booth

Screen Shot 2014-01-17 at 8.57.41 AMDallas — Mohawk, Quick-Step, Pergo, and Columbia laminate brands will be featured prominently in the NALFA (North American Laminate Flooring Association) booth during Surfaces.

The NALFA booth is designed to serve as a showcase for “NALFA certified products.”  Only laminate flooring that meets the strictest criteria regarding quality can achieve NALFA certification.  All Mohawk, Quick-Step, Pergo, and Columbia flooring is NALFA certified.

“When purchasing our brands, consumers can have full confidence they are bringing flooring of the highest quality into their home,” said Paij Thorn-Brooks, vice president of brand marketing for Unilin.

NALFA’s booth S7158 will be located on the Surfaces show floor at the Mandalay Bay Convention Center.

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NALFA announces LAMMY nominees

Screen Shot 2014-01-16 at 1.27.02 PMWashington, D.C. — The North American Laminate Flooring Association (NALFA) has announced the nominees for the 2013 LAMMY Awards, which are given annually to the best of the best in the laminate flooring industry.

Both companies and individuals are recognized for excellence in a number of categories.

Industry experts from NALFA, along with the trade editors will vote for the annual LAMMY winners. “There are so many people and companies doing fantastic work in the laminate flooring industry,” said Bill Dearing, president of NALFA. “The LAMMY Awards offer a terrific opportunity to celebrate these professionals among their peers.”

The winners will be announced at Surfaces.

2013 LAMMY Award Nominees

Member of the Year

Karen Shoemaker, Mohawk
Pat Smith, Pergo
Jane Waters, Unilin-Mohawk

Associate Member of the Year
Friedrich Meyknecht, SELIT North America Inc.
Gary Palmer, Pregis
Marco Seitner, SELIT North America Inc.
Brent Sholl, Sealed Air

Distributor of the Year
Boone
Cronin
Crownhill
Elias Wilf
Midwest Floor Covering
TriWest

Retailer of the Year
Aspire Design
Avalon
Lowes
Menards
Nebraska Furniture Mart
RC Willey

Associate Member Company of the Year
SELIT North America Inc.

Member Company of the Year
Columbia
Kronotex
Mannington Mills
Mohawk
QuickStep (Unilin)
TORLYS

 

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DMX Plastics joins NALFA

Washington D.C. — The North American Laminate Flooring Association (NALFA) is pleased to announce DMX Plastics has joined NALFA as an associate member.  DMX Plastics is a leading manufacturer of moisture control products such as DMX 1-Step, DMX AG, DMX 5M and Corrugated Tubing.

“We’re excited to have DMX Plastics join NALFA,” said Bill Dearing, president of NALFA.  “The company is an innovator in moisture control products, a great fit for our goal of promoting and growing the laminate category.”  Continue reading DMX Plastics joins NALFA

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Laminate: State of the industry

Recovery mimicking economy: Slow, steady

By Matthew Spieler

Volume 26/Number 24; April 15/22, 2013

With authentic visuals and textures, such as those in Mannington’s Restoration Collection, coupled with great performance and ease of installation, manufacturers feel laminate is in position to gain share as the economy recovers.

Like many industries and flooring categories in particular, the laminate sector was hit hard by the recession. But executives are quick to note the category’s decline was really no worse than what others experienced. In fact, many will note laminate maintained its overall market share and as the economy slowly improves they see the category regaining traction, with overall growth ranging from a minimal 1% to a modest 5%

Bill Dearing, president of the North American Laminate Flooring Association (NALFA), pointed out, “There was only a decline in the sense the entire building material business was off. Yes, there is competitive pressure but certainly not a ‘decline.’ And as overall business improves, so will laminate.”  Continue reading Laminate: State of the industry

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CFI hosts ‘historic’ installation event in Dalton

Volume 26/Number 22; March 18/25, 2013

Dalton—During a historic four-day training event earlier this month, more than 100 installers, dealers, claims analysts and industry associates gathered here to learn how to install flooring “the right way.” The training was sponsored by the International Certified Flooring Installers Association (CFI).

The event began with a laminate and wood installation workshop taught by CFI’s Bob Gillespie and Danny Sherman along with Armstrong’s Tim Provence as attendees participated hands-on to learn more about installation. The teams of two tested and prepared substrates, installed laminate flooring, then installed various types of wood flooring according to the manufacturers’ guidelines. Continue reading CFI hosts ‘historic’ installation event in Dalton