Commercial laminate: Mills using brand, education, service to rebound

Commercial laminate: Mills using brand, education, service to rebound
June 01, 2010

Not unlike its wood sector counterpart, commercial laminate producers have suffered their share of economic bumps and bruises recently. By putting emphasis on service, style and brand, the hope is that an upturn manifests itself sooner rather than later.

Generally speaking, the laminate sector echoes the construction industry, noted Tammy Weadock, marketing manager, Wilsonart. “According to Reed Construction Forecast of May 2010, the decline in commercial construction spending will slow sharply during the balance of 2010 with spending turning up at year’s end. Reed says retail will recover first, followed by offices, which will be followed by hotels.”

She also noted how the residential home-building market’s decline has impacted flooring retailers, whose bulk of business has been consumer driven. “The challenge is to encourage these retailers to pursue new sales avenues and diversify their residential business with a commercial portfolio. “Brand awareness and reputation are very important,” she explained. “History and heritage matter a lot in this challenging economic climate. Architects, designers and clients want to rely on products with a history that provide a comfort level.”

Anthony Riggi, product manager, flooring, Abet Laminati, agreed retail will be first to come out of the doldrums. “Retail was one of the first segments to react to the slowing economy—and it is one of the first to show signs of recovery. Retail tries to invest pre-emptive of consumer spending habits. The stock market recovery has helped consumer confidence, and in doing so, hopefully retail as well.”

Riggi believes a recovery has begun. “I doubt, however, we should expect bubble style consumption anytime soon. There is caution in today’s decision making.”

While Weadock agreed retail is first to recover, she believes hospitality will be the last. “Lodging will be the last to recover because of recent overbuilding in casino and destination hotels, which dominated the hotel construction market in recent years. Construction of hotels targeted to consumer and business travelers will recover much sooner.”

Needless to say, today’s economy presents its share of challenges. “The biggest challenge is when clients choose residentially rated materials for their lower cost, then are displeased with the long-term results,” Riggi said. “Another challenge is the customer’s attempt to save money by accepting a bid from a low bidding installer. At the end of the project the customer is not satisfied because the installer could not afford proper care in installation.”

At Pergo, Mike Nielsen, vice president, commercial, described the state of the commercial laminate sector as underdeveloped. “We’ve been in the commercial flooring marketplace for quite some time now. Compared to ceramic tile and hardwood, we really don’t see the A&D community embracing laminate flooring. Nobody has gone in to train the architect and designer to use laminate flooring in lieu of wood, vinyl or LVT.”

Nielsen believes education is the cure-all. “We are going out and training the architect and designer just like we did in the early ‘90s when we launched Pergo to the retail environment.”

Regarding the various sectors where Pergo sees opportunity, Nielsen noted retail is the strongest. “The strong retailers, especially the European-based retailers, are using this economic slowdown to make an investment in their brand, to go in and remodel their stores. We work with some very large clothing chains and automobile dealerships that [because of] the currency exchange are able to invest in their storefronts.”

-Louis Iannaco

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