2016 Flooring Industry Study: Flooring Poised for Growth
The 2016 Floor Trends Flooring Industry Study, conducted by BNP Market Research and compiled from answers given by readers of Floor Trends, Floor Covering Installer, Stone World, Contemporary Stone & Tile Design and Tile Magazine, offers a look at a flooring market poised for continued growth.
About three-quarters of respondents reported an increase in flooring sales last year, over sales two years ago. In addition, 69% of respondents expect sales to increase this year. A majority of respondents (55%) felt sales had increased slightly in 2015; 17% said they believed sales had significantly risen. (See Chart 1)
Half of respondents said flooring sales were more than $750,000, including 5% with sales of $20 million or more; 25% are saw 2015 flooring sales of $1.5 to $19.99 million; 17% with sales of $750,000 to $1.49 million, and 8% seeing sales of $500,000 to $749,000.
Overall flooring market
Of this year’s respondents, 60% sell/install at least five flooring products, with area rugs being the least sold/installed product and all other products sold at least by about three-quarters of respondents.
Carpet and tile/stone are reported to get the most share of showroom floor space and accounted for the largest share of overall flooring sales last year. Carpet and tile/stone each accounted for 29% of 2015 sales.
Respondents’ showroom floor space is given over to a mix of categories, with carpet at the top (37%), followed by tile/stone (22%), hardwood (16%), resilient/vinyl/LVT (14%), laminate (9%) and area rugs (3%). Carpet saw a decrease of 5% in sales from the previous year, while tile and stone gained 5% of sales. (See Chart 2)
Residential replacement accounted for more than half of respondents’ sales (52%) followed by commercial replacement (18%), residential new construction (16%), and commercial new construction (14%). Optimistic about the market, 72% of respondents expect residential flooring sales to increase, while 59% expect growth in commercial sales.
The majority of respondents (92%) said 2015 area rug sales were less than $250,000. More than half (62%) believe sales will remain flat this year, and 22% said a slight increase is coming. Only 2% believe the increase will be significant.
Concerning rug sizes, the most popular sizes sold are is 5 x 8 and 8x10, which are each tied for (59%), followed by 6 x 9 (53%) and 4 x 6 (29%). (See Chart 3) The vast majority of respondents (86%) sell machine-made area rugs, but there was a slight increase (+4%) of oriental rug sales in 2015.
For the carpet category, 61% of respondents indicated their 2015 carpet sales to be less than $500,000. Two-thirds of respondents expect an increase in their carpet sales this year, compared to previous year.
On average, 31% of total carpet sales last year is believed to come from super soft carpets. Nylon carpets typically generate half of total carpet sales, while polyester carpets contribute to one-third share of carpet sales. (See Chart 4)
Overall perception of carpet is likely to have decreased this year, due to fewer respondents rating it highly on ease of installation and cost to consumer. However, 73% showed satisfaction in product styling, which is a 7% increase from the previous year.
The majority of respondents (72%) saw less than $250,000 in hardwood sales last year. While two-thirds of respondents expect their hardwood sales to increase this year, about a quarter do not expect any change.
Red oak and hickory were the top-selling types of hardwood last year, as indicated by about a third or more respondents. On average, the majority of hardwood sold is of mill/national brands (76%), while a quarter of hardwood sales come from private labels. Rustic/Distressed appears to be taking over as the most popular finish of hardwood this year with a 10% increase. Despite lower perception of cost to customer, about three-quarters of respondents rate hardwood highly. Increased popularity, product styling and durability perceptions could be contributing to the positive perception of hardwood. (See Chart 5)
Turning to the laminate category, 82% of respondents sold less than $250,000 worth of laminate last year. A quarter of respondents expect laminate sales to increase this year, while about a third do not expect any change.
On average, laminate installations primarily use mill/national brands (77%) over private labels (23%). Wood designs are still the most popular style at 90%.
The overall perception of laminate dropped 21% this year, however it is rated highly by about half of respondents for ease of installation (46%). (See Chart 6)
Over three-quarters of respondents sold less than $250,000 worth of resilient/vinyl/LVT last year, and 61% of respondents expect their sales to grow this year.
All respondents’ companies indicate selling Luxury Vinyl Tile/Plank, followed by over three-quarters of respondents selling VCT and/or sheet. Sales of wood plastic/polymer composite (WPC) flooring is heating up with 55% of respondents selling the product. (See Chart 7)
On average, the majority of resilient/vinyl/LVT sales involve mill/national brands and planks.
Increased popularity and positive perception about resilient flooring on ease of installation, cost and durability are likely to have helped improve the category’s overall perception this year, with 70% of respondents rating it highly.
In the tile/stone category, about two-thirds of respondents sold less than $250,000 worth of tile and stone last year, but 58% of respondents expect sales of tile/stone to increase this year.
A majority (74%) of respondents sold tile/stone from a mill/national brand. Sold by type, porcelain tile accounts for 61% of sales, followed by ceramic tile (23%), stone (14%) and other (less than 1%).
Domestic U.S. tile/stone also leads at 47% of respondents, followed by Italian (24%), Mexican (10%), Spanish (7%), Turkish and Chinese (both at 5%) and Brazilian at 2%. (See Chart 8)
Overall perception of the category remained relatively steady with two-thirds of respondents rating tile/stone highly overall. Tile/stone received high rating for product durability (90%), product styling (72%) and popularity with consumers (68%). Tile/stone receives lowest ratings on cost and ease of installation.
Social media and the Internet
The survey asked questions in relation to a respondent’s social media and Internet presence.
Nearly half of respondents (48%) said they market their business both through a website and a social media presence, while 23% said they have only a website and 9% said they only have a social media presence.
Despite the continued importance of a web and social media presence to build their brands, 20% of respondents said they have neither a website nor a social media presence. (See Chart 9) When asked to rate the relative usefulness of having an Internet presence, respondents chose keeping a company website at 45% compared to 39% for social media.
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