Distribution: Wood continues to hold is own as most desirable

Home Inside FCNews Distribution: Wood continues to hold is own as most desirable

October 24/31, 2016: Volume 31, Number 10
By Ken Ryan

The popularity of hardwood flooring seems impervious to the rampant growth of the LVT/WPC segment. No matter how many new market segments the resilient product taps into, no matter how many “wood looks” marketers come out with, in some precincts at least, there is no substitute for the genuine article.

Distributors agree there is a sizable segment of flooring consumers who aspire to have hardwood floors in their home and are all too willing to pay a premium for it. “They want real hardwood, they don’t want something that looks like hardwood,” said Jeff Striegel, president of Elias Wilf, Owings Mills, Md.

That sentiment is particularly evident in California, home to the highest real estate values in the continental U.S. It is one reason why Galleher, Santa Fe Springs, Calif., continues to emphasize this segment. “Hardwood is 80% of the business. I wish it wasn’t, but it is,” said Jeff Hamar, CEO. “It’s all wood out here. Wood is clearly an aspirational floor and people with the money don’t want to settle for imitations—no matter how realistic the visuals are in LVT or laminate.”

Denver Hardwood, another top 20 distributor, has seen steady growth in unfinished wood. In addition, the prefinished market is gaining market share. “Hardwood continues to be the strongest category with significant growth in prefinished, mainly due to a focus on our private-label program,” said Enos Farnsworth, president. “We are experiencing significant growth in the remodel sector, with a solid foundation in new home construction. Through 2015 and 2016, we are investing in new facilities and personnel.”

Belknap White, a top 10 distributor based in Mansfield, Mass., has also benefitted from the strength in hardwood, which accounts for 50% of its mix. “Most certainly the economy is stronger and our commercial business continues to grow with many large projects being built in our area,” said Paul Castagliuolo, executive vice president, general manager.

Striegel said the one area where resilient might have the upper hand is the high-rise multifamily sector. “WPC is made for that market; it has some heft to it. But wood is not under threat by any of this.”

A survey of top distributors showed the majority have reduced their assortment of laminate flooring as a percentage of business, in some cases to as low as 2%. A few wholesalers maintained laminate at their 2015 levels, and only one of the top 20 said laminate represented 10% or more of their business. That is not to say laminate hasn’t fared well in some markets—it is simply about picking the right lines.

“We have done real nicely with laminate,” said Bob Weiss, CEO of All Tile. “Just when you thought it was over for laminate, we have had a real good introduction of the Balterio IVC line that has done well for us. There is a place for style and design, and laminate is a very functional product.”

In 2015 more builders opened up to the possibility of installing laminate flooring as an entry-level or first-upgrade option. According to distributors 8-inch wide laminate looks almost like the real thing and is more scratch resistant and indentation resistant than other surfaces.

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