The overall market for floorcoverings is mature, with growth dependent on strong consumer and business confidence, a healthy housing market and buoyant economy. According to AMA Research, the UK floorcoverings market was worth an estimated £1.8bn in 2014, representing value growth of 2% from 2013. A significant decline in 2008-11 has been followed by relatively moderate, but steady, improvement between 2012 and 2014.
This has been the result of an improving economic climate,
a recovering housing market and rise in business confidence and levels of
investment. The market, which is heavily reliant on replacement and
refurbishment, was also buoyed by insurance repairs and replacement of
floorcoverings after the floods during 2013-14 in some areas of the UK.
Demand in 2014 has also been driven more strongly by the
contract sector, particularly offices, leisure/entertainment applications,
where business sentiment remains relatively high. Continuing pressure on
margins and average prices has meant that there has been further change to the
supply structure in the UK, with further rationalisation of production
Carpet still dominates the floorcovering product mix,
accounting for over 50% in value terms in 2014, a share that has changed only
marginally over the last 5 years, but at least indicates the slide in share has
stabilised. Wood accounts for around 15% of the market, followed by vinyl,
tiles and other floorcoverings.
Demand for laminates has remained relatively flat,
although demand is being boosted by a move away from low value entry level
products, with greater concentration on mid-upper value sectors – while solid
and engineered woods remain popular. Vinyl products have performed relatively well. Luxury
vinyl tiles have continued to take share of both the domestic and contract
market and ongoing product developments have included higher-specification
coatings, improved slip resistance and formats such as loose lay.
A key factor in the market recovery of floorcoverings is
the rate of recovery in private sector housebuilding and private sector non-residential
construction output into the medium-term. Housebuilding volumes are increasing,
while office construction and fit-out are also enjoying strong growth.
Consumer confidence and spending on higher value durables
has been hit by the downturn, but both have improved in 2014 and are expected
to continue in 2015 – particularly as real incomes are finally starting to rise
reflecting the impact of lower fuel prices and inflation and ongoing
stabilisation of employment prospects and the underlying economy. Given this
background, annual growth for the total floorcoverings market is currently
forecast at around 2–3% over the next few years.
“Heavy competition is
likely to remain a key characteristic of all flooring sectors into the
medium-term, with margins likely to remain under pressure” said Andrew Hartley,
Director of AMA Research. “In terms of the
supply structure, it is likely that UK manufacturing will be subject to further
challenges in terms of production facilities, while in the wider European
flooring market there is likely to be further consolidation as the emerging
floorcoverings ‘super specialists’ continued to widen their product ranges.”
For more information about this report, visit: www.amaresearch.co.uk/floorcoverings_14.html.
Market Report – UK 2014-2018 Analysis’ report is published by AMA Research,
a leading provider of market research and consultancy services within the
construction and home improvement markets. The report is available now and can
be ordered online at www.amaresearch.co.uk or by calling 01242