As part of its strategic mission to provide greater access to industry data, market trends, and analysis, ISSA has teamed up with the American Association of Cleaning Equipment Manufacturers (AACEM) to highlight trends impacting all segments of the commercial cleaning industry. The result: a series of market research reports and applicative data for ISSA members.
The ISSA & AACEM Industry Trends Report was developed to help members stay current with commercial construction and renovation activity and projections, flooring materials trends, and key U.S. economic indicators. ISSA and AACEM have engaged commercial flooring market research leader Market Insights, LLC, to conduct the data analysis and prepare these reports on a quarterly basis. Market Insights, which also publishes the U.S. FLOOReport, derives its flooring consumption forecasts from manufacturer financial reports, imports and overall economic data, and its own research and estimates.
The reports provide perspective for all constituents of the commercial cleaning industry. For example:
- Manufacturers can use the market trends and construction activity information to drive product development and adaptation decisions.
- Distributors and building service contractors can gain greater understanding of end-user trends and preferences to adapt their product offerings and service solutions.
- In-house service professionals may gauge flooring installation trends and analyze how their facilities compare to similar building types.
- Plus, all ISSA members can leverage the reports to learn more about underlying forces that will shape the built environment and U.S. economy overall.
The quarterly reports from 2017 are available exclusively to ISSA and AACEM members at www.issa.com/flooringtrends.
Flooring Market Forecasts
Let’s explore some of the key findings from the past year. Each quarterly report includes forecast and calculated actual results from U.S. FLOOReport for the following materials in commercial, industrial, and residential settings:
- Carpet and rug
- Hardwood flooring
- Ceramic tile
- Resilient flooring (linoleum, sheet vinyl, vinyl composition tile)
- Laminate flooring.
In 2017, the total flooring market for commercial and industrial settings (excluding rubber flooring) was forecast to grow 5.1 percent to US$7.3 billion at manufacturer sale pricing—or 4.8 billion square yards in volume. The average price per square foot was estimated to be $1.39, up from $1.36 in 2016.
According to the 2017 third-quarter ISSA & AACEM Industry Trends Report, most flooring types are performing somewhat near to forecast levels. The fastest growing flooring type is resilient flooring, which was up 12.9 percent in the year to date, compared to an 8.4 percent forecast. Conversely, hardwood flooring was the biggest laggard, falling 11 percent in the year to date as luxury vinyl tile (LVT) and other hard surface floorings cannibalized wood flooring sales more than expected.
Floor Type by Building
The reports also outline which flooring types are most common in different types of commercial settings along with factors driving their installation and use. For example, the 2017 second-quarter report provides commentary on trends impacting health care construction and which flooring types are most frequently installed to address these trends. A key trend in health care is consolidation—as major health systems merge, hospitals acquire physician and specialty practices, and physician groups join forces to reduce overhead. Based on the nature of the health care business—and in line with market forces—the report goes on to explain the extent to which hard surface floorings, resilient flooring, LVT, and ceramic tile are used in health care settings for practicality and cost considerations.
Commercial Construction Trends
In addition to outlining specific flooring market data, the ISSA & AACEM Industry Trends Report includes a detailed overview of construction trends and market factors impacting the commercial market, which is summarized into the following five building types:
- Education and institutional
- Health care
The 2017 second-quarter report outlines the two major components of the commercial market: new construction and replacement/renovation. While nonresidential construction has been volatile during the last several years, the commercial renovation market has grown steadily and overall is forecast to grow slightly during the next few years as more buildings age and require renovation, maintenance, repair, and remodeling.
U.S. Economic Data
Building on the detailed data and commentary on flooring materials and commercial construction, each quarterly report also provides an update on the state of the U.S. economy and outlines key market measures. From an overall economic perspective, the reports include an annual and quarterly breakdown of metrics such as changes in the leading economic indicator index, gross domestic product, bank prime rate, and change in consumer price index.
As it relates to the commercial market, additional measures of relevance to our community include change in real commercial construction, corporate pretax profits, office vacancy rates, and real value of put-in-place construction.
As the 2017 second-quarter report indicates, offices composed 26 percent of the commercial floor area in-place in 2016. Keeping tabs on office vacancy rates on a quarterly basis can prove valuable to those supplying and servicing this market.
Putting It All Together
No matter the nature of your business, you can take advantage of these new market-research resources, which are complimentary to all ISSA-member organizations. Simply log in to your ISSA.com member account and access the reports at www.issa.com/
flooringtrends. Additional quarterly reports will be posted to this page on the site throughout 2018.
ISSA and AACEM hope you find the reports informative and useful in your business, and encourage you to share any feedback to ensure these resources deliver relevant data and commentary throughout the year.