The survey, which received a 14 percent response rate, was sent to a representative cross-section of 2,000 active, qualified floor covering dealers/contractors selected on an Nth name basis from the domestic circulation of NFT subscribers.
According to the study, issues currently impacting the ceramic/stone business are topped by (multiple responses allowed): increasing numbers of Big Box channels, 61 percent; increasing competition from other flooring channels, 47 percent; eroding profit margins, 38 percent; other flooring types, 35 percent; consolidation among retailers and manufacturers, 31 percent; and consumer brand switching, 11 percent. The Big Boxes are viewed by the majority of respondents as neutral in affecting business, but are viewed as very negative by more respondents than very positive, presently and in 18 months.
Other important survey findings include: 68 percent of floor covering retailers/contractors sell ceramic/stone products. Look for this percentage to continue to increase in the coming years. Is your store selling ceramic and stone? Compare your store's sales figures to the ones following and see how your operation matches up.
On average, 37 ceramic/stone sales are generated each month (see chart 2). Twenty percent of those surveyed tallied 50 or more ceramic/stone sales each month. These average figures compare to 2003 study results in other product categories: vinyl, 19 sales; carpet, 62 sales; and laminates, seven sales. The sources for ceramic tile include ceramic tile distributors, 80 percent; flooring distributors, 63 percent; and direct from manufacturers, 41 percent (multiple responses allowed).
Nearly one-third (31 percent) of respondents have ceramic/stone sales of $200,000 or more. The mean is $236,681 annually.
The ticket amount among all survey respondents per average ceramic sale is $3,475. Three-in-ten (30 percent) of these retailers noted an average ticket amount of ceramic sales in the $1,000 to $2,999 category.
Fewer retailers are currently involved in stone compared to ceramic. The average ticket amount per sale of stone is $3,007. Thirty-four percent of those involved in stone report an average stone sale of $3,000 or more.
Over two-thirds (68 percent) of retailers/contractors expect their tile sales to increase, while 31 percent expect tile sales to stay about the same for the next 18 months. Of those expecting an increase, 37 percent project a 6 to10 percent increase in the segment.
Consumption of ceramic and stone tile breaks down as follows: floor tile, 70 percent; wall tile, 15 percent; countertops & backsplashes, 8 percent; trims & decorative tile, 5 percent; and exterior, 2 percent. This will be a definite growth area for the floor covering retailer/contractor as most tile manufacturers produce complementary products for floor, wall and countertop applications.
Over the next 18 months, our retailer/contractor respondents expect to sell larger-sized tiles (see chart 4). The 16-by-16- (up 9 percent) and 18-by-18-inch (up 7 percent) formats should receive more interest at retail, according to those surveyed. The 12-inch-square size is projected to drop to a 39 percent share (a loss of 17 percent) while the 8-by-8 inch dropped to 18 percent (a loss of 4 percent), compared to last year.
Respondents report porcelain tile sales of 38 percent (mean) with 50 percent projecting increases in the segment and 50 percent indicate it will stay the same within the next 18 months. The increase is expected to be 16 percent on average (see chart 5).
Product design and styling, product quality, distributor service/support and price are the four top attributes, ranked in order of importance, affecting the retailer's decision to sell/promote a particular brand of ceramic tile.
These are just some of the findings in NFT's 2003 Ceramic/Stone Tile Market Trends Study.
Among the topics covered are: ceramic/stone sales generated each month; annual ceramic/stone sales; average ticket amount of ceramic/stone sales; types of ceramic tile sold; expected change in ceramic tile sales within 18 months; ceramic floor tile most frequently sold; ceramic wall tile most frequently sold; ceramic tile size expected to sell most within next 18 months; porcelain tile percentages; changes in porcelain tile sales within 18 months; domestic vs. imported ceramic tile sales; floor space devoted to ceramic/stone products; ceramic/stone residential and commercial percentages; frequency of recommending ceramic/stone; consumer response to ceramic/stone products; perception of ceramic tile characteristics; top-selling ceramic tile brand; ceramic tile brand attributes; issues impacting ceramic/stone business; challenges ceramic tile manufacturers need to overcome; effect of Big Box home centers; ceramic tile sales training; ceramic tile installation needs; and sources of ceramic tile.
The complete 2003 Ceramic/Stone Tile Market Trends Study is available for $225 each or $195 for multiple copies.