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FEATURE


FOCUS ON: WOOD / LAMINATE FLOORCOVERINGS


Market


Performance The wood floorcoverings sector has been negatively affected by the recession, with a decline in consumer spending and a significant downturn in the housing market key factors in an estimated 26% decline in market value 2008-12. In 2012, the wood flooring sector (solid wood, engineered wood and laminates), was estimated to account for around 16% value share of the total UK floorcoverings sector, which is estimated to be worth some £1.7bn.


Average prices have continued to remain under pressure over the last 2 years as exchange rate


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fluctuations, global timber prices and a situation of over-supply within the market, continue to squeeze both prices and margins.


Imports continue to dominate the market, reflecting the leading positions of some international floorcovering groups in the UK market.


The market has been particularly affected by the downturn in the housing market with installations into new build impacted by declining completion numbers, but with wood also facing increasing competition from alternative floorcoverings such as porcelain and natural stone floor tiles.


The contract sector for wood flooring has also experienced more difficult conditions in 2010-12 as key end-use sectors – such as offices and retail - experienced significant downturn in new build output as well as refurbishment projects.


Although the recession has had a negative impact on laminate sales, this sector was already experiencing a downward trend prior to 2008. Indications are that the peak for laminate sales occurred around 2004-05, with the sector experiencing an estimated 14% value decline 2005-08.


The experience of the laminates sector over the last 2 years has been


for some stabilisation following a 22% decline 2008-11. The budget market sectors have been particularly affected by the downturn in domestic DIY installations.


Contrasting with the experience of laminates, solid & engineered woods experienced growth of an estimated 22% in 2005- 08, but has subsequently declined by around 12% to 2012. However, solid and engineered woods have benefited from interest in the middle and upper market sectors stimulated by the “improve not move” trend – particularly as prices for premium products have become more competitive.


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