Resilient leads overall industry growth

Tuesday, December 20, 2022 from Floor Covering Weekly

By Katie Batkin

New collections like CFL’s Builder Line will be on the market in 2023 as resilient continues to grow.

The resilient category has become a consumer favorite due to its gorgeous visuals, durability and affordability. Its performance attributes and ease of installation serves the needs and demands of both retailers and their customers.

While growth began to slow in the third quarter of 2022 for much of the industry, according to Catalina Research, resilient flooring still posted strong gains and continues to lead growth over other flooring categories.

According to Jeff Francis, resilient category director of Shaw Industries, this is strongly due to resilient’s “ongoing product development, performance innovations and cutting-edge style and design.”

Turning Inward

Home building as well as more people moving out of urban areas has increased demand for vinyl. The COVID-19 pandemic also prompted a DIY project and home renovation movement with homeowners taking on refurbishing projects on their own.

“The additional time people had working from home, concerns about social distancing, lack of installers based on demand and the increase of availability of easy-to-install products all led to an increase in homeowners installing themselves,” offered Barron Frith, CFL president. Additionally, many had more disposable income from saving money on travel, which resulted in more money spent on home improvements.

Resilient flooring is affordable and does not require one to “tear up the entire house to install it,” according to Jamann Stepp, vice president of hard surfaces, residential at The Dixie Group (TDG). “It can float over the existing floor and can be installed in a day,” he added.

Noted Mohawk’s Adam Ward, vice president of product management, resilient, “People at home were interested in DIY, clickable flooring that they could install themselves. It’s the right product with the right price and performance.”

Clean & Current 

Resilient flooring, in fact, is ideal for the lifestyle consumers have become accustomed to and, it is easy to clean and worry-free. Suppliers also said that the category offers a strong value proposition.

“The category is still growing because it’s defying all the rules. It’s biting from every single segment in the market,” said Rotem Eylor, CEO of Republic Floor. He explained that people who renovate a lot of older homes with other kind of flooring are now turning it into SPC, as it’s the “go-to floor” today.

Casey Johnson, CEO of Happy Feet International agreed, “It’s grown because it’s more affordable and more resilient for today’s lifestyles. It’s an unmatched product that appeals to the masses.”

The overall performance of resilient is what continues to drive sales today. It solves problems related to moisture, as it is a waterproof product. “At end of the day, it’s a desirable product that is very easy to clean,” Stepp noted, adding that that the improved visuals and enhancements in PVC film have also attracted many consumers.

Challenge Afloat

With any new product comes challenges. For example, in 2020 and 2021 the industry had to raise its prices on resilient to cover the adjustment in ocean freight cost. In turn, the dollars are currently up but units sold is down, according to Stepp. “I think there’s a 180 for next year. More prices will come down,” he said.

However, this price fluctuation has been a tough battle for the category, as it has had to spend on the surcharge.

Also, Frith at CFL noted the high inventory levels in units and value will be a challenge to sell off in the next several months. “The continuous change with lower shipping costs out of Asia will continue to be challenging to forecast and manage inventory levels,” he said.

Eylor at Republic Floor addressed another struggle — manufacturers had a significant focus on making the thinnest resilient products, which in turn, deteriorated the quality. “There was a movement in the past year back to laminate because of the ‘race to the bottom’ on SPC to make it cheap.” This made many consumers turn to other categories on the market for a better bang for their buck.
However, “as in every fast-growing segment, there is a need for clear product standards — this will help to avoid very low-quality products entering the market,” noted Frith at CFL. “CFL is very involved in RFCI (Resilient Floor Covering Institute) to help develop standards and guidelines to ensure the quality of the category is consistent, managed and sustained,” he said.

Looking Ahead

Although the economic forecast for 2023 looks like an uphill battle, manufacturers are keeping a positive outlook for the future of the category, despite the weight of inflation. From new product launches to technological advances, there is still much room to grow.

“We believe that there will be growth in all segments, some more than others. We still see tremendous opportunity for growth across all (luxury vinyl) product types and have invested in designs across all our product types to continue to offer the best designs in every format,” said Bill Anderson, CEO of Karndean Designflooring.

Regarding multi-family category growth, Russ Rog, president, Metroflor Corporation noted an uptick. “Based on housing shortages and higher interest rates, we think this segment will continue to be strong,” he said. “We also see robust growth in commercial, specifically hospitality and healthcare.” Increased corporate activity now that people are returning to the office requires more space to accommodate workers.

Although there is some concern related to consumer spending and home construction, Karndean still sees demand across its channels for the coming year. “Commercially, we are still seeing strong demand across all segments, not just jobs that were delayed during COVID and are now back on schedule, but new spend on new projects,” added Anderson.

Ward at Mohawk believes it will be a lot tougher in regards to growth in 2023. “It’s going to be a different year with the changes in the market. However, we could see upticks in remodel because it’s been tough in the past years with everyone having a long wait list for materials,” he said. Manufacturers still see the light at the end of the tunnel and remain focused on the increased product supply.

Agreed Francis at Shaw, “Glue down LVT and sheet vinyl were both undersupplied in 2022, so we’ll see improvements in both of those platforms in 2023 now that service positions are stronger. Rigid core products lead the resilient category and will continue to take share from other platforms.”