Hardwood Floors April/May 2017

MARKET MATTERS INDUSTRY INSIGHTS

By Stuart Hirschhorn

U.S. Wood Flooring Market: OPPORTUNITIES AND THREATS IN 2017

These are challenging times for the wood flooring market. Wood flooring’s ability to make additional inroads in the U.S. floor coverings market is being stymied by increased competition from wood-look ceramic tile planks, new and innovative luxury vinyl tile (LVT), and flooring made of plastic composite products (WPC). These competing wood-look floorings are beginning to take share from manufacturers of solid and engineered wood flooring. Wood flooring market growth trends are also being hampered by slower gains in new housing construction, a key driver of wood flooring sales. In addition, rising hardwood lumber costs are making it harder to capture consumer’s growing preference for wood-look flooring. Wood flooring manufacturers and marketers will need to take advantage of stronger gains in the residential replacement market and increased penetration of the commercial market to make further inroads in the U.S. floor coverings market. Dollar wood flooring sales (shipments minus exports plus imports) are estimated to have increased by only 3.1 percent in dollars and 3.6 percent in square feet in 2016. U.S. sales reached an estimated $3.8 billion and some 1.7 billion square feet. These gains compare to a 12.5 percent compound annual growth rate in dollars and 9.4 percent annually in square feet between 2011 and 2015. Sales gains were strong during this period due to double-digit increases in housing starts. This is important to this market since wood flooring has the highest dependence on the builder market, more than any other flooring material. Housing starts increased closer to 5 percent in 2016, which dragged down wood flooring market gains. Competition also intensified from ceramic tile and resilient flooring manufacturers, both of which are also able to offer wood- look flooring. In 2016, the strongest competition came from LVT products, especially from click-installed LVT wood-look planks. Catalina Research Inc. estimates the total LVT market increased

BigStockPhoto ©

24 hardwood floors www.hardwoodfloorsmag.com