Bruce Zwicker - Wood Flooring Expo 2021 i… · Flooring statistics are macro, ... Stone 6%...
Transcript of Bruce Zwicker - Wood Flooring Expo 2021 i… · Flooring statistics are macro, ... Stone 6%...
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Bruce Zwicker INDUSTRY CONSULTANT
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RANK COMPANY LOCATION 2017 SALES (Projected)
1 Haines Glen Burnie, MD $490m 2 BPI Memphis, TN $230m 3 Belknap White Group Mansfield, MA $210m 4 All Tile Elk Grove, IL $200m 5 Galleher Santa Fe Springs, CA $198m 6 Tri-West Santa Fe Springs, CA $168m 7 NRF Distributors Augusta, ME $159.5m 8 William M. Bird Charleston, SC $157m 9 Apollo Dist. Co. Fairfield, NJ $156m 10 FlorStar Sales Romeoville, IL $142.8m
TOP 10 U.S. FLOORING DISTRIBUTORS
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AGENDA TOPICS
• Most Important Points
• Wood Flooring Demand
• U.S. Wood Flooring Supply
• Summary NOTES: Information is from various sources Flooring statistics are macro, not indicative of your area Flooring statistics are directional and not precise
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MOST IMPORTANT POINTS • U.S. and Europe wood flooring demand growth slowed
– Price and installation expensive relative to alternatives – In U.S., average discretionary income for high ticket items not grown
• Wood flooring remains consumers’ aspirational flooring choice
• U.S. produces less and imports more wood flooring • LVT/MLF/WPC/SPC are taking share from wood flooring • Wood flooring isn’t going away - needs to be sold and
its story told
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WOOD FLOORING MARKET • More than 6 Billion square feet
• Increased 5% per year since 2012
• China is 30-35% of the total world market
• North America is 25-30% of total world market
Sources: BAZ, Market Insights & Catalina Research, Other
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NORTH AMERICAN FLOORING • Total North American flooring market is
approximately $29 Billion • U.S. Market is approximately $26.5 Billion - 90%
of North America
– U.S. wood flooring is approximately $3.5 Billion – Growth rate slowing – estimates vary – perhaps – 2% to -4% – Wood flooring is approximately 13% of total U.S. flooring – Higher percentage than most countries
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CONSUMPTION OF FLOOR COVERING PRODUCTS IN WESTERN EUROPE, 2017
Textile 41%
Stone/Ceramic 23%
Laminate 13%
Vinyl 15%
Wood, 5% Other, 3%
Source: FEP Estimations
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Carpet & Rugs 44%
Hardwood 13%
Ceramic 14%
LVT 12%
Vinyl 6%
Stone 6%
Laminate 4%
Other 1%
2018 U.S. MARKET BY PRODUCT TYPE
LVT 25% growth per year. Almost all of total flooring growth.
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U.S. WOOD GROWTH TRENDS 2018 $3.5 billion • Approx. $200 – 300 million Industrial Use
(Truck beds, Railcars, etc.) • Approx. $300 – 400 million Unfinished Flooring • Approx. $2.7 billion Prefinished Flooring
Sources: BAZ, Market Insights, NWFA & Catalina Research
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U.S. WOOD MARKET BY END USE
Sources: NWFA, BAZ & Catalina Research
Commercial is small Maximum of 10% - 15%
New Residential 20% - 30%
Good but slowing growth
Slowing growth
Residential Remodel 60% - 65%
Also called Retail
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U.S. WOOD GROWTH TRENDS 2002 – 2015 7% to 10% per year
2016 – 2017 2% to 5% per year
Wood flooring sales are slowing primarily due to LVT
Wood is still the homeowners top choice But, wood is expensive
Sources: BAZ, Market Insights, NWFA & Catalina Research
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12 Sources: BAZ, Market Insights & Catalina Research
Independent Dealers are losing share in retail/remodeling
% of Total Retail Flooring Sales
Independent Dealers 40%
Home Depot 15%
Lowes 10%
Floor & Décor 5%
Lumber Liquidators 2%
Other retailers 28%
Approximately 13,000 Independent Floor Covering Dealers with approximately 17,000 store locations.
TOP U.S. RETAILERS – ALL FLOORING TYPES
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TRENDS IN ENGINEERED WOOD FLOORING
Engineered Wood 54%
Solid Wood 46%
% of Wood $ Sales
Engineered Wood 57%
Solid Wood 43%
% of Wood SF Solid wood was over 50% of the market. Engineered wood is increasing.
2018
Sources: BAZ, NWFA & Catalina Research
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WOOD FLOORING PRICE TRENDS Solid wood flooring price has increased since 2007
Engineered wood price has decreased since 2007
2007 $2.24/SF 2017 $2.05/SF
Sources: BAZ, NWFA & Catalina Research
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0%
20%
40%
60%
80%
100%
Other Imports
China Imports
U.S. Production
U.S. FLOORING IMPORTS & PRODUCTION
Sources: Market Insights & US International Trade Commission
Imports are almost 50% of U.S. consumption. China is at least a third of imports. China is 50% of wood and 85% of LVT/MLF imports.
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US Wood Flooring ($ Billion)
Year Wood Market % of Total US Flooring
US Production Imports Imports % of Market
1998 $1.4 7% $1.3 $0.1 7%
2006 $2.5 10% $2.2 $0.4 15%
2009 $1.5 9% $1.0 $0.5 30%
2018 $3.1 13% $1.4 $1.6 52%
U.S. production has decreased
U.S. WOOD FLOORING
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WOOD FLOORING MAJOR PRODUCERS • Top Three - Armstrong, Shaw and Mohawk = $800+ mil
– Includes OEM imports
• Mullican, Somerset, Lumber Liquidators, Mannington, American OEM and Others = $400 - $500 mil
• Industrial and Other smaller producers = $200 - $300 mil • U.S. Production is not very profitable and there is over
capacity. • Manufacturers reduced production, raised prices, and sold
all or part of their wood divisions
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U.S. Wood & Bamboo Flooring Imports % of Import $
2008 2014 2015 2018 (est.)
China 50% 72% 70% 55%
Canada 11% 8% 8% 9% Vietnam 0% 1% 2% 7% Cambodia 0% 0% 1% 7% Indonesia 2% 2% 3% 4% Thailand 1% 0% 1% 1% Brazil 20% 3% 3% 3% Other 15% 11% 12% 14%
Southeast Asia imports increased
WOOD & BAMBOO IMPORTS
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MOST IMPORTANT POINTS • U.S. and Europe wood flooring demand growth slowed
– Price and installation expensive relative to alternatives – In U.S., average discretionary income for high ticket items not grown
• Wood flooring remains consumers’ aspirational flooring choice
• U.S. produces less and imports more wood flooring • LVT/MLF/WPC/SPC are taking share from wood flooring • Wood flooring isn’t going away - needs to be sold and
its story told
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BRUCE ZWICKER
CHRIS ZIZZA
DREW HASH
ISABELLE BROSE
MICHAEL MARTIN
PANEL OF INDUSTRY LEADERS
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Chris Zizza PRESIDENT & CEO
C&R FLOORING
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Drew Hash VP SHAW INDUSTRIES
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Isabelle Brose MANAGING DIRECTOR FEP
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PANEL OF INDUSTRY LEADERS
THREE THEMES
Innovation in flooring
Promotion of wood flooring
Labor issues in wood flooring installation
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EUROPEAN PARQUET MARKET
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EUROPEAN PARQUET MARKET
• Everybody wants parquet • Still its market share remains at 5%+ • 2006 - Real Wood initiative (licenses, website)
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EUROPEAN PARQUET MARKET
• 5-2-7 Project – Sensitizing the European consumer to opt for parquet
as THE flooring solution – 2017 - SmartBlogs – Next steps… when & why parquet falls out of the consumers’
decision journey Optimize the sales funnel - focusing efforts on right stages, channels and communication content