Hicksville, N.Y.—With the first quarter of 2004 having drawn to a close, spring has finally sprung. With the change of seasons, FC-News asked several of the industry’s top wood flooring executives how business was over the first three months and what they see coming up. “We’re doing very, very well so far this year,” said Chris Thompson, vice president of sales and marketing for Canada-based, wood flooring manufacturer Boa-Franc/ Mirage, which is primarily involved in the residential segment.

“Business is very good. For us, things for 2004 are [pretty much] going according to expectations. We are above where we were at this time last year.” Gazing into his crystal ball, Thompson noted, “We see nothing but this trend continuing for the rest of the year. “Our business is strong and we expect and are planning for continued growth, continued increases in our business. “There is no question we see the trend of bringing nature indoors, going more to hard surface flooring continuing,” he explained. “Our business is good, and we expect nothing but the same throughout the year.”

“Things have gone pretty well thus far,” said Jim Morando, president of Tarkett Wood. “We have always said that we want to grow at the rate which is twice the overall industry growth and we had a double digit increase over last year in the first quarter. So things are going a little bit above expectations right now. “We are optimistic that things are going to continue at the pace we’ve set in the first quarter,” he explained. “What we’ve seen in the three months is really before we’ve activated all our new products and had a major display push so we think that we should be able to sustain that rate further.”

Product wise, Morando noted, our biggest emphasis is on items featuring “special surface treatments, whether they be distressed, or hand scraped or colorwashed. That is what we are focusing in on. The distressed woods, as well as the darker woods, are still very popular right now.” “The first three months of 2004 have gone very well for Columbia Flooring,” said David Wootton, the company’s president. “Sales have increased across all product lines, with strong growth in engineered and laminates as well as continuing success in 3/4-in. prefinished solids—an offering that has benefited from the impact of the three acquisitions we completed in the fourth quarter of 2003.

“The first quarter of 2004 has been especially exciting as a result of the excellent market response to our new Essence range of hand-sculpted engineered products, the ramp-up of our operations in West Virginia, and the completion of our fourth acquisition in the past six months: McMinnville Manufacturing Co., a producer of unfinished strip located in McMinnville, Tenn., which will supply product we’ll finish at our plants in Melbourne, Ark., and Holden, W.Va.,” he explained. “Compared to 2003 we are 50% ahead in sales,” said Wooton, “even after taking out the impact of our acquisitions; we are 33% ahead of last year on a like-to-like basis.”

On the raw material side, Morando commented, we still see “continued inflation [to a point] where we are going to go ahead and implement a price increase on our solid products. We estimate it to be in the high single digits range, and it will probably happen in the next 30 to 60 days.” “The biggest disappointment so far in 2004 has been the continuing increases in lumber prices,” said Wootton, “which have forced us to announce price increases on our 3/4-in. solid products, effective May 1.”  John Woolsey, Anderson’s director of marketing, admitted, while the company had no present plans to increase pricing, like James Bond said, “‘never say never.’ At this point in time, we haven’t been talking about it. Due to the wet spring last year, the cost of lumber went skyrocketing and we’ve absorbed it, but as of now I don’t think we want to kill the goose that laid the golden egg. The wood category is growing so rapidly right now.”

“Last year was a record year for us,” he continued. “And this year, we are at or ahead of where we were in 2003 in terms of increases. We are running substantially ahead of where we were last year with record numbers.” According to Woolsey, it’s not certain species that are hot sellers right now but certain “looks. Products that have done well for us recently include ones where we have involved the visual appearance, the things we have done to the graining, for example, to enhance the graining on the elm. I think we make a mistake when we start focusing on species rather than what it really is, the visual looks. “The people at Mannington learned this a long time ago, and if anybody has held their own in the category, it has been Manning ton, which has done it with visuals,” he explained. “So, textures and visual enhancements to the product is what is making for the hot selling products.

“The first step in this was the rustics, which we introduced with our Mountain series back in 1996, then came the hand distressed products,” he added. “With the rustics, that’s when we first brought forth character grade products and started marketing that as premium product.” For the rest of the year, Woolsey noted, I believe you are going to see “a bunch of new things. The category itself is probably going to continue to grow, possibly to the detriment of the other kinds of products within the pie. We’ve heard numbers for the hardwood segment becoming as high as 20% of the [flooring] market, which is a huge number for a product that, five or six years ago, was 3% or 4% of the market. We are certainly at 9% or 10% or above that at this point depending upon whose numbers you look at.”

“The reason you are going to see hardwood grow against the other products in flooring is,” explained Woolsey, “it’s the only flooring product that adds value to a home. If you look at when people look to sell their house, having hardwood floors means something, it adds value to the house, so I believe you are going to continue to see that. You’ll also see hardwood floors become more of the center of the design rather than the background for the design.” Woolsey noted another aspect of the wood segment to take heed of is, how manufacturers are dealing with Internet retailers, which “are driving traditional floor covering retailers nuts. As manufacturers, we are limited by antitrust laws as to what we can or cannot do. But the dealers are going to have to figure out how to market their value-added. They have it. I think they spend more time looking for the manufacturer to solve the problem than they do taking advantage of their value-added and promoting it to their customers.

“But, if I were a retailer, I’d be just as frustrated as they are that the Internet customer comes into the store to look at the product then goes back and buys it over the Internet,” he explained. “The key is, she came into the stores, they just have to figure out how to hold her when she is there.” “For the rest of 2004 we anticipate sales to continue to grow for Columbia and the hardwood and laminate segments of the industry,” concluded Wooton. “We continue to be concerned about escalating lumber prices but, given continued strong growth in the housing market generating demand for our products, we expect the market to be able to absorb the recent price increases.”