Like many other trades in the United States, the wood flooring industry has seen its share of ups and downs over the last decade. Wood flooring business surged from 2002 to 2006, but this thriving domestic market was also facing the pressures of increasing imports and price wars.
Key Year for Wood Flooring
In 2007, imports made up nearly half of the American wood flooring market, a significant increase from just one-third five years earlier. Domestic manufacturers struggled to keep up with changing American preferences, such as the growing demand for exotic wood and eco-friendly products like cork and bamboo while continuing to lose ground to the purchasing power of larger retailers and wholesalers.
Several foreign suppliers gained a foothold in the U.S. market, with China emerging as the leading importer. China’s ability to offer relatively inexpensive materials and benefit from low wages allowed it to provide wood flooring at lower prices. As a result, China’s market share grew in 2007, at the expense of both other importers and U.S. wood flooring suppliers.
Recession Hits
The North American economy took a major downturn at the end of 2007, dragging the housing market down with it. The wood flooring industry was also impacted, with many retailers and contractors closing their doors during the Great Recession.
Experts suggest the recession officially ended in mid-2009, but the wood flooring industry didn’t experience significant recovery until 2010. According to the National Wood Flooring Association’s annual survey, sent to domestic manufacturers and distributors in January of the following year, sales and industry confidence showed signs of improvement in 2010. However, many respondents reported that price increases over the past two years had negatively affected their businesses. More than half of the NWFA members surveyed also noted the growing influence of big box stores on their operations.
Despite these challenges, it was evident that the wood flooring industry made progress in 2010, gradually recovering from the recession by the end of 2009. Most businesses saw steady performance throughout 2011, though concerns about increased competition, unpaid receivables, and the impact of Chinese imports continued to dominate the industry.
Performance in 2011
While it’s still early for concrete data in 2011, some insights into growth and challenges in the wood flooring industry can be observed. In February 2011, new home sales hit a record low, and sales of existing homes continued to decline during the same period. This ongoing downturn has limited any potential improvements within the flooring industry.
The wood flooring sector is also facing an internal dispute over import duties on Chinese-engineered wood flooring products. Major U.S. manufacturers of engineered wood flooring are pushing for import duties on Chinese imports, while a group of distributors, importers, and retailers are opposing this move, as it could threaten their businesses.
While the courts will ultimately decide the outcome, the result will undoubtedly shape the future of the wood flooring industry in America. From a booming market to a deep recession and now in the recovery phase, the industry has evolved, with high-quality products and skilled installers paving the way forward.