Armstrong World Industries (AWI) has dismissed their Armstrong Flooring (AFI) subsidiary last week. The CEO of AFI, Don Maier, stated that this is a very important step for the flooring company to grow in the rapidly developing market of the residential housing market, according to The Street.
“Our business is actually split 65% residential, so it is very important to us as to what happens in the homebuilding market. But we are 35% commercial as well, so that's also an important segment for us,” Mayer added.
Lancaster, the Pennsylvania-based Armstrong Flooring is the biggest manufacturer of wood flooring products all over North America, operating 18 facilities in 3 countries. The company provides flooring for Lowe’s and Home Depot, offering direct distribution too.
Due to the fact that the hard-surface flooring demand has grown by 4% from 2012 to 2016, Maier stated that this was also an important thing for AFI to take into consideration.
US housing starts have registered a 9% growth from 2013 to 2015 and may keep on growing until at 11% CAGR from 2015 to 2017. Existing sales have also increased at 2% CAGR from 2013 to 2015 and may continue the increase until 5% CAGR from 2015 to 2017.
"We use the consumer journey, which is almost always going to involve a stop in one of the big box locations, to our advantage and that helps support our independent retailers as well," said Maier.
Regarding the recent issues of Lumber Liquidators, whose products have been detected to raise cancer risks, Maier stated that AFI is a strong brand, in whom the costumer can trust.
"In times of uncertainty when people are not sure about some products coming in from Asia, it is really important to pick a brand consumers know they can trust. And that is Armstrong," said Maier. The drop in petroleum prices is also boosting margins for the company, he added.
Maier said he does not view the major home improvement retailers as direct competitors.
"We use the consumer journey, which is almost always going to involve a stop in one of the big box locations, to our advantage and that helps support our independent retailers as well," said Maier.
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