With the economy in the doldrums for the length of time it has been, it was only a matter of time before the commercial carpet sector would be affected similarly to what the residential broadloom segment has experienced. With carpet sales as a whole down anywhere from 20% to 30% in 2008, numbers for the commercial sector are now reflecting this trend, and are down so far this year in similar fashion, while modular tile sales continue to gain market share, offering commercial producers a beacon of hope.
While opinions differ as to when exactly things will turn around, the one certainty among commercial carpet producers is, they are preparing for a longer time until signs of recovery are seen rather than sooner.
Glen Hussman, president and CEO of Tandus, said, "From the information that we are able to gather from public company, supplier and industry reports, the commercial segment appears to be down 25% to 30% year over year.
'the commercial market didn't really start to contract until the second half of 2008," he explained, 'so the first quarter 2009 numbers compared to the first quarter of 2008 are significantly lower, in the range described above."
According to James Lesslie, president of Beaulieu Commercial, "Our customers have had significant cutbacks and layoffs, therefore commercial specifications are more challenging [now] than this time last year."
Tim Baucom, Shaw's vice president of commercial marketing and sales, stated that in 2008, the commercial industry re-mained flat compared to 2007. "In the first quarter of this year, the industry is down 5% to 10%."
So far, in 2009, "orders are down 15% to 25%," he explained, "compared to 2008. Shipments are off 5% to 10%. Within that, we are seeing flat to slight growth in the education, healthcare and government markets. Retail, hospitality and corporate markets are experiencing deep reductions."
Mark Clayton, vice president of J&J Invision, agreed with Baucom, saying the economy "has obviously had an impact on the commercial segment, just as it has the residential segment. Sales began to soften in the third quarter of 2008 and have remained challenging since.
'the first half of 2009 has proved to be more challenging in certain segments," he added, "but there are other areas where business opportunities seem to be flourishing. For example, corporate and retail have obviously taken a hit over the past several months, but education, government and healthcare remain bright spots."
Al Kabus, president of The Mohawk Group, said, "We believe commercial is down anywhere from 20% to 25%.