Blog

In the News – Joseph Lundgren Consulting for Tile Letter

Jan 12, 2022

In the News – Joseph Lundgren Consulting for Tile Letter

Joseph Lundgren Consulting: What’s in store for 2022? – TileLetter

Joseph Lundgren Consulting: What’s in store for 2022?

Joe Lundgren, of the industry consulting firm Joseph Lundgren Consulting, has had his finger on the pulse of the industry from trends to economic trends and more.

Now, he gives his expert perspective on what we can expect from 2022. Its been a wild ride politically, economically, and pretty much in every way as we’ve ridden the waves of COVID for the last three years. Lundgren peers into his crystal ball and gives us an overview of what the next 12 months will bring.

Growth in 2022

  • We expect all categories of hard surfaces to expand in 2022.
  • Sales will grow due to both residential remodeling and new home construction continuing to grow.
    • The LIRA estimates remodeling could grow as much as 9%
    • NAHB estimates 1.6M homes
  • Labor shortages and supply chain issues will continue through 2022.

Supply chain issues

  • What is the supply chain? It is the unseen route of manufacturing, transportation and logistics that gets U.S.-manufactured and imported products from where they are manufactured and mined to where they are going. At the end of the route is the distributor who has paid for the product. Unfortunately, the decreased amount of product has resulted in higher cost. Why has there been a decrease in product? Simply said — supply and demand.
  • Shortages in imports (in the case of tile, 70% of our consumption is imported) is not only apparent at the manufacturer’s end, but once product is produced, there are shortages of containers, hence driving the cost of shipping products higher. Why? In early 2020 at the beginning of the pandemic primary manufacturing countries throughout Asia and Europe were significantly impacted by the spread of coronavirus cases. Therefore, manufacturers shut down due to their workforce being sick or in lockdown. In response, shipping companies cut their schedules in anticipation of a drop in demand for moving goods around the world. Americans took the funds our government doled out, plus money we used for restaurants and other entertainment and redirected it to products made for our homes, which were suddenly doubling as offices and classrooms. The rapid increase in consumer purchases overwhelmed the system. Manufacturers ramped capacity up to satisfy demand. The steep surge in demand clogged the system for transporting containers and therefore inventory piled up in warehouses and at ports because of a shortage of containers.  And where were they?
  • Well, they got stuck in the wrong places. Many countries, specifically China, shifted their focus on producing protective gear like masks and shipped them all over the world. Containers were unloaded in places that generally do not send much product back to China, hence empty containers piled up just as Chinese factories were producing a mighty surge of other goods destined for wealthy markets in North America and Europe. Due to the lack of containers, the cost of shipping products increased rapidly. Before the pandemic, sending a container from Shanghai to Los Angeles cost $2,000. By early 2021, the same container cost was as much as $25,000.

Commercial growth in 2022

  • Let’s talk commercial. Commercial is back on for 2022, the ABI has been increasing since February 2021. This is usually a 12-18 month indicator which means we will see a significant increase in specific segments.
  • In 2022, we expect all non-residential subsectors to return to growth as the removal or loosening of restrictions enables demand pent up during the pandemic to be released back into the economy. We forecast hotels, private offices, and libraries and museums to expand by 41.1%, 13.8% and 34.6% respectively in 2022.
  • One in three Americans lives in New York, Florida, Texas, or California. Commercial growth is forecasted to expand 15-20% in these specific states.

What will happen to floor coverings in 2022, specifically, tile?

  • Why did we lose share in tile? Will we get it back? The answer to both questions will be determined by our own actions. We as an industry have not been innovative enough to compete with other categories at a similar rate of innovation that meets the consumers need, specifically luxury vinyl tile.
  • All of us including myself are very adept at pointing out the negatives that accompany this product, but let’s face it all of us are astonished at its growth rate as it is something we’ve never seen in the floor covering industry before.
  • Yes, we can all point out that it’s plastic and not environmentally friendly, it can scratch, and it certainly is not what it says it is, see https://tigerprints.clemson.edu/matsci_pubs/5/. However, you must give the industry a tip of the hat with the innovation along with marketing they have done to promote the category.
  • So, it’s time that we as an industry begin to capitalize on the features and benefits a tile versus all other hard surfaces. We have hung our hat on inkjet technology for far too long, we have focused on large-unit porcelain panels which are growing but not anywhere near what we see happening in LVT. Some of us have looked to the exterior as our savior with 2CM porcelain pavers, let’s face it that’s not enough to keep up with the growth that we see in LVT.
  • Premium goods and performance products are fueling growth. Research shows consumers value durability more than ever, and the increased focus on residential remodeling to adapt to new lifestyles is motivating consumers to upgrade flooring selections.

The Action Plan. So, what do we do?

  • The biggest opportunities lie in technology and performance innovations that improve ease of installation, durability, and cleaning.
  • Let’s stop the pity party and invest in some type of innovative technology that invigorates the growth of tile and present marketing campaigns that point out the obvious virtues of tile versus other solid surface categories.
    • What’s better than tiles in terms of: durability, green appeal, no VOCs, versatile Designs, cleanability and healthy advantages of using ceramic tile (see whytile.com)?
  • Innovate- this is not necessarily a new size, packaging, design, or color, but investing in researching innovative ideas and opportunities. This can be as simple as devoting resources to new business development.
  • Support the Ceramic Tile Education Foundation (https://www.ceramictilefoundation.org/)
  • Come on- you know why! It’s you and I that are key to ceramics growth and why do we expect it to grow if we sit on our back ends? Resting on our virtues has not worked.

2022 will be a good year and we will spend most of our selling, general and administrative expenses (SG&A) on current sales, but don’t ignore the future in 2022. Otherwise SG&A will eventually be known as “Sales Going Away.”

Want more information and insight? Contact Joseph Lundgren Consulting Joe@jlcconsult.com, josephlundgrenconsulting.com or call 214.641.7773.

CSTD News

Porcelain Tile Creates a High-end Customer Experience

Porcelain floor tile provides elegance and durability for Maggie Louise Confections.

Tile of Spain Announces 2021 Award Winners

Tile of Spain, the association representing over 100 Spanish tile manufacturers, today announced the winners of the 20th annual Tile of Spain Awards of Architecture and Interior Design.

Dune Shares Fall Trends in Kitchen Design

Trending tile colors, shapes and surface finishes elevate kitchen designs.

Video: Total Solutions Plus 2021 Reunites Industry Members

Members of the tile industry were excited to reconnect during Total Solutions Plus 2021, an annual conference which provides a platform for education, networking and socializing. 

Video: Fall Product Trends

View some of the latest trending styles that are currently being selected for both residential and commercial designs.

Lapitec takes center stage in Italian villa design

Lapitec sintered stone was used for multiple applications – both exterior and interior – at the Ca’ Gioia villa in Italy.

Virginia Tile Opens New Location

Virginia Tile recently expanded to include a showroom in Troy, MI. In 2016, the company acquired two leading peers in the industry, ISC Surfaces and RBC Tile and Stone, to become a leading tile distributor in the Midwest.

How Does the “Designer for the Stars” Design for Herself?

Vadara quartz provided durability and aesthetic value to a kitchen remodel in Los Angeles, CA.

Stone World News

Plans are Set for StonExpo 2022

As the New Year approaches, show management is gearing up for a successful event, complete with many show features and a loaded educational program – on and off the exhibition floor

January Technology Update: Fixtop Epoxy Setting Adhesive

Tenax Fixtop Epoxy Setting Adhesive is now available in 10-gallon and 5-gallon kits. 

A Refined Alpine Experience

Patagonia quartzite and Sequoia Brown marble from Antolini’s Exclusive Collection provide an chic interior aesthetic at Montchalet resort in Alto Adige, Italy.

Getting Ready for TISE 2022

Dana Teague, vice president of the design group for Informa Markets, and Jim Hieb, chief executive officer of the Natural Stone Institute, recently took time to talk with Stone World about this year’s upcoming show.

Stone Column: What’s in Store for 2022?

As we ring in the New Year, many of us might be wondering what will 2022 have in store for us. COVID cases were on the rise again as 2021 concluded, and I know I am not alone in thinking how this will affect in-person events – especially in the first quarter of this year.

OSHA Inspections and Safety with Jeff Courtright

Jeff Courtright, safety coordinator for Planet Granite, discusses safety for employees as well as the biggest issues OSHA finds during an inspection.

2022 Stone Summit Schedule Released

Natural Stone Institute and Stone World announce 2022 in-person and virtual stone industry education events

Stone Producer a Source of Spanish Granite in North America

Granisa, the Spanish stone producer, based in Porriño – Pontevedra, Spain, has been supplying granite slabs to national and regional distributors in North America for the past two decades. Stone World had the opportunity to talk with Granisa about its North American market.

One-on-one with Zucchi Luxury Stones

Stone World talks with Leonardo Pellegrino, the director of Zucchi Luxury Stones, to discuss Dolomite marbles from Brazil.

Nature and Natural Stone

Last month, my husband and I took a weekend getaway to Lake Placid, NY. While I have driven past there numerous times, it was the first time visiting the Village.

Front Range Stone Countertops: Evolving Through Two Decades

Recently, Stone World stopped by Front Range Stone Countertops fabrication shop in Englewood, CO, and spoke with several members of its leadership team.

Technology Update: Weha A1500 5 Pad Vacuum Lifter

The Weha A1500 5 Pad Vacuum Lifter was the suggestion of a stone fabricator that needed to do a lot of panels for a commercial job. 

Bedrock Tiles Becomes Carbon Neutral Certified

Bedrock Tiles talks about the carbon neutral certification process.

Dune Shares Fall Trends in Kitchen Design

Trending tile colors, shapes and surface finishes elevate kitchen designs.

MAPEI Corp. and MAPEI Caribe Help Rebuild Haiti

 MAPEI Corp. and MAPEI Caribe Inc. have jointly donated $5,000 to the Haitian recovery effort. 

Stone Column: The Power of Social Media

Total Solutions Plus 2021, the conference which brings members of the tile industry together each year, provides a place for networking, socializing and education – with topics ranging from business issues to technical installation subjects.

How Madonna University’s Welcome Center was Slated

Beautiful and durable, CupaClad slate was a natural choice for the exterior design of Madonna University’s new Welcome Center.

Tryon's Tips: Coach’s Corner Opportunity Knocks…

A brief thought of reflection and a heartfelt “Thank You” for all the readers who commented and provided positive feedback on my last column.

Hindsight 2020 -- Adapting to the New Norm

The roads were empty. It started with 15 days to slow the spread. Stay at home orders were in place and Americans were on lockdown. Everyone was confined to their homes, glued to their televisions to learn more about the dangerous contagion that was bringing their world to a complete stop. 

Architect Designer Interviews

Sculptor Darrell Petit Discusses Stone Carving and Sustainable Building

Jason Kamery interivews sculptor, Darrell Petit and talks about his career and his pasion for stone and sustainability of natural stone.

Tile Trends with Alena Capra

Contemporary Stone & Tile Design caught up with designer Alena Capra of Alena Capra Designs in Fort Lauderdale, FL, at Coverings 2021 to gain insight into what is trending in tile designs these days. 

A Sculptural Urbanscape at Four Seasons Hotel & Private Residences

Taking center stage of the urban landscape located at the entrance of the Four Seasons Hotel & Private Residences is “Event,” a stone sculpture crafted by sculptor Darrell Petit of Darrell Petit LLC and Stony Creek Quarry Inc. Petit was commissioned by landscape architecture firm Michael Van Valkenburgh Associates (MVVA) of Cambridge, MA.

One-on-one with Brittney Harmond

Contemporary Stone & Tile Design recently spoke with Brittney Harmond, a representative for Ceramics of Italy, to discuss the latest trends in large-format porcelain slabs. 

The virtual showroom

It has been a year since the COVID-19 pandemic struck and literally paralyzed everyone worldwide, but during this time many manufacturers and distributors of stone, tile and alternative surface materials have strategized and adapted new policies and procedures to make a safe working environment for their employees and customers alike.

Quartz surfacing contributes to “modern farmhouse” style

Cassandra LaValle, the founder and creative director of Coco Kelley and The Emerald Studio, favored Silestone Lagoon for the surfacing and bright white paint from Benjamin Moore. In this interview, La Valle explains her thoughts and inspiration behind the design.

One-on-one with Leslie Markman-Stern

Leslie Markman-Stern, president of Leslie M. Stern Design shares her experiences and trends she is seeing in the market

2020 Hospitality design trends

With the hospitality design sector in a seemingly constant state of change, tile and other alternative material manufacturers need to stay up-to-date on current trends in colors, shapes, finishes and sizes to meet the demands of the architectural and design community.

One-on-one with mosaic tile artist Mercedes Austin

Contemporary Stone & Tile Design magazine had the opportunity to talk with Mercury Mosaics owner Mercedes Austin about her 20 years of experience, how she got started and some of the experiences she has had working with customers.

Designer uses large-format tile to transform a small space

Working within an extremely small footprint in an original 1951 home, Sheryl Steinberg, Allied ASID, LEED Green Associate, of Sheryl Steinberg Interior Design, LLC in Bethesda, MD, was tasked with creating an open, modern, bright, efficient, usable, roomier bathroom that reflected the owner’s modern style.

One-on-one with mosaic tile creator Danilo Bonazza

Danilo Bonazza is a mosaic artist and owner of Art & Mosaics. He discusses how he got involved with mosaic art and how he designs his works of art.

HanStone Quartz used to create a dream kitchen and bathroom

Using the stunning views of Downtown Atlanta, architect and designer Vykintas Genys used HanStone Quartz to bring his client’s vision to life.

One-on-one with architect Ryan Thewes

Ryan Thewes, the owner of Ryan Thewes Architect, has been a licensed architect for 10 years and discussed his business and some of the trends he is seeing in the stone and tile industries.

Traditional building, stone design used for Church in Philadelphia

FFKR Architects in Salt Lake City, UT, has worked with the Church of Latter Day Saints for at least 25 years. FFKR Architects has built these temples in major cities all over the world, roughly 150 of them and every year the Church of Latter Day Saints announces four or five new temples.

CSTD Column: From the Editor

For this issue of Contemporary Stone and Tile Design magazine, we take a look at stone used in architectural landscape and building stone applications, as well as some creative uses of quartz surfacing.

One-on-one with designer Karen Kettler

Karen Kettler, the president of Karen Kettler Design, based in Charlotte, NC, talked with Contemporary Stone & Tile Design to discuss her 20 years of experience with using stone and tile in her designs and the trends she is seeing in the industry.

Kitchen & Bathroom Trends

The kitchen is one of the most essential spaces in any household. A place where meals are made, family time is spent and memories are created. Appropriately deemed the “heart of the home,” the design of this space is crucial, especially to those who like to entertain.

One-on-one with architect Stephen B. Jacobs

"As I look back at my career, almost every decade pulled us in a different direction. In the 1970’s we focused on Adaptive Reuse, designing projects in New York City but also Patterson NJ, Norwich CT, and Upstate NY."

One-on-one with Stephanie Vierra

Stephanie Vierra has developed, managed and taught programs that support an interdisciplinary and integrated approach to a variety of topics. She is the president and owner of Vierra Design & Education Services, LLC, specializing in research, project management, and educational programs on sustainability and whole building design.

One-on-One with Interior Designer Dawn D. Totty

Dawn D. Totty is a native New Yorker, and lived there for all of her life before moving south 10 years ago. She started designing in the fashion world, and then transition into interior design 15 years ago. She designs residentially and commercially. Her signature claim to fame is very custom designs.