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December 1, 2004
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for floorcoverings in the contract sector is heavily influenced by the level of commercial
construction within the economy, both in terms of new build and refurbishment activity.
The contract floorcoverings market was estimated to be worth ?87m in 2003 and current
forecast indicate growth levels of 2-3% during 2004 with the market expected to reach an
estimated ?05m, rising to an estimated ?69m in 2007 based on steady growth in the
The major factors underpinning consistent growth levels within the contract floorcoverings market include strong growth in public sector construction (particularly health and education), higher specification levels, increasing health and safety considerations and the volume of pedestrian traffic to which contract floorcoverings are subjected. This ensures that replacement and refurbishment programs are often undertaken on a planned basis and are not always subject to prevailing economic conditions.
Recent development within the sector has been moderate, with the carpet sector in particular having experienced a difficult period. The market has been affected by recent events such as the September 11th attacks and the threat of terrorism, which has caused a global downturn and a slowdown in some specific key end use markets such as the tourism sector. Conversely, some end use markets, such as education and health, have received increased funding from the government as well as from PFI projects, and are continuing to provide some stability. Health and safety regulations and buoyancy in general construction levels at present has also provided some growth to the sector.
Short-medium term prospects for the market should see growth rates of around 2-3% to reach ?69m by 2007. Further growth will be supported by continued funding from the government and PFI sectors in health and education, as well as sustained healthy levels of new build and RMI construction.
In terms of product mix,
contract carpets still dominate although have lost significant share recently and
currently account for around 60% of the sector. The carpet sector has come under heavy
pressure from other floorcovering types, especially wood/laminate floorcoverings. The
downturn in the tourism sector has also affected the contract carpet market, with hotels a
large end user of the product. The carpet sector has also suffered from the growth of
cheap imports, with some
Wood/laminate floorcoverings have seen significant increases in the past few years and now are the second largest sector within the contract market, with a share around 15%. The product has benefited from current fashion trends and high levels of media exposure and is experiencing wider use in retail and commercial applications.
Vinyls are estimated to account for 12% value share of the contract floorcoverings market in 2003. The product has benefited from the growth in safety flooring and increased specification in retail outlets. Vinyl can also provide a low-cost alternative to wooden flooring. However, increases in raw materials (oil) in 2003/04 may put pressure on the price of the product. Ceramic tiles and resins each account for an estimated 6% value share of the contract floorcoverings market and have both recorded healthy levels of growth in recent years with RMI work in the leisure industry providing impetus.
Linoleum has enjoyed something of a slight resurgence in recent years, benefiting from increased spending in the health and education sectors, though is still a niche product. Both cork and rubber floorcoverings are also mainly used for niche end-use applications that utilize the hardwearing and chemical/agent resistance properties of these products. In terms of key suppliers, the contract market is very similar to the domestic market with a number of manufacturers supplying to both sectors. Major importers and companies such as Interface, Low and Bonar and Brintons dominate supply of contract carpets, whilst Carpets International has been placed into administrative receivership. Forbo-Nairn, Marley, James Halstead and Armstrong dominate the contract vinyls sector. The supply of contract linoleum floorcoverings is dominated by Forbo-Nairn.
The wooden flooring sector has experienced a substantial increase in suppliers in recent years, with major companies including Unilin, Kronospan, Junckers, Egger, Tarkett and a wide range of imports from Europe and North America.
In terms of end-use applications, commercial offices/buildings remains the main end-user with an estimated 20% value share of the contract sector. Healthcare, education, leisure and retail are all significant end-use applications estimated to account for individual market shares of over 10%. The healthcare and education sector are expected to benefit in the short to medium term from PFI projects and government funding, which should increase their importance as end-use applications, unless there is a change of Government at the next General Election likely to be held in 2005.The fragmented nature of the flooring contractor/installer sector has meant that distribution is either direct supply or via wholesalers. The use of direct supply tends to be for larger contracts with wholesalers particularly active within the vinyls sector. In terms of the overall floorcoverings market, Headlam Group dominates the distribution/wholesaler sector.
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