Vol. 63 No. 7 A Hearst Business Publication April 7, 2014 $4 F LOOR C OVERING W EEKLY The Industry’s Business News & Information Resource Finkell is back with 3 new wood venture Mullican outpaces growing market US production, automation drive results By Mallory Cruise [Johnson City, Tenn.] The hardwood flooring industry grew at a rate of 10 percent last year, the first significant industry growth since 2005-2006, according to Neil Poland, president of Mullican Flooring, based here. And his outlook for this year is even more positive as housing starts are projected to be up over 25 percent this year after rising over 22 percent last year. Not only is the industry back on track, he said, Mullican’s business strategy is on target for continued growth that will out-pace the industry overall. “We believe we are taking market share. For this year, given how badly the weather’s been, it has started out better than expected. And our goal for this year is continued double digit sales growth,” Poland said. One factor contributing to the industry’s growth, he noted, is Hurricane Sandy construc-tion, which hit the Northeast in October 2012. “People fail to remember that the New York Metro area, which includes north and central New Jersey and Long Island, is the wood flooring production world’s largest ¾-inch solid stateside in 2012 and Poland hardwood flooring market. said that it has proven to be The hurricane provided a a great growth opportunity, lift in building last year and, adding that Made in U.S.A. because of delayed building, products truly gained momen-will continue to provide a lift tum during the recession. this year,” Poland said. Historically an importer The effects of this perfect of engineered wood flooring, storm still pose challenges Mullican supplied lumber to the company as well as and logs to Asian companies the industry as a whole. But and also partnered with Poland said that Mullican Asian factories to manufac-has worked diligently to effi-Neil Poland ture wood flooring products. ciently meet demand, provide a return on investment and maintain mar-“We transferred the majority of our product gins. (For more information on pricing, see here to our engineered wood facility in Johnson City. When we decided to build a story below.) plant here, we were met with an important question, ‘How can you do this and compete Stateside production Continued on page 14 Mullican moved a portion of its engineered FCW Exclusive 2014 Domotex Asia/Chinafloor boasts new product, innovation, sustainability Pricing effects force suppliers By Mallory Cruise [Shanghai] The 2014 Domotex Asia/Chi-nafloor show held here at the Shanghai New International Expo Centre March 25-27 was packed with excited attendees and exhib-itors, and a bounty of new and innovative product. A number of the key messages at the show this year were focused on advanced technology, sustainability and products that promote safer indoor living conditions. Visitors from around the globe attended the Additionally, show attendees and suppliers 2014 Domotex Asia/Chinafloor show. from all over the world came to build on their brand power and relationships. realistic in terms of U.S. marketability. While innovation continues to influence Piet Dossche, president and CEO of the Domotex Asia/Chinafloor show, this USFloors, said that while a number of year, according to attendees and exhibitors, new product stood out to him, one trend in new product innovation has become more Continued on page 8 to streamline production As supply pressure and price increases con-tinue to plague the hardwood market, man-ufacturers are working diligently to stabilize the category while meeting the increasing consumer demand. While the industry has welcomed the increase in consumer demand for wood products, a harsh winter coupled with fewer sawmills to supply lumber has created an imbalance that is forcing makers to streamline costs, absorb pricing when Scott Sandlin possible and intro-Shaw duce new product innovations in an attempt to right course the market. Passing price increases on to retail has also been necessary. Jack Shannon Jr., CEO of The Shannon Lumber Group, which owns Shamrock Plank Flooring, explained that the tanking economy from 2009 to 2012 took with it approximately 40 percent to 50 percent of hardwood capac-ity. Now that the economy is rebounding, there simply aren’t enough sawmills to meet the growing demand, he said. “Many of the manufacturers didn’t have the capital or the relationships with banks to carry them through the slow times. So, what you have now in the industry are the survivors,” said Shannon. “We’re all smiling because business is great and prices are up but how can we raise capacity when we can’t find anyone to cut the logs?” Kevin Bieder-mann, senior vice president, residential flooring products, Dan Natkin Armstrong Flooring, Mannington added that during the downturn, sawmills also dramatically cut back on capacity and inventory, or simply went out of business, creating a lean supply environ-ment and making it difficult for manufactur-ers to react to the market change. “With spikes in demand of both floor-ing and from other industries, the logging industry wasn’t able to supply. The wet weather in the fall also had a severe impact Periodical For breaking news updated each business day, visit us online at www.fcw1.com Continued on page 14