New colors, options, and materials keep this category sizzling.
By Craig A. Shutt
The talk of a housing slowdown doesn’t faze manufacturers of deck products. Instead, even more producers of composite materials seem to be entering the market, and existing suppliers are expanding their offerings to ensure dealers don’t need to look elsewhere to round out their line. The result is more variety in price points, décor options, fastening systems, and accessories.
"The nice thing about deck products is that we do most of our business in the remodeling category,” says Kevin Brennan, vice president of sales and marketing for TimberTech in Wilmington, Ohio.
As production housing slows, homeowners decide to stay put and enhance their current residence—and that often means adding a deck to expand the outdoor-living facilities. In addition, existing decks that are five to 10 years old need to be resurfaced or upgraded, further expanding the market.
Custom homebuilders also will continue to represent a significant portion of the market, says John Long, national sales and marketing manager for Geodeck in Cocoa Beach, Fla. "Production-style homes typically don’t have a deck in any event, whereas the custom homebuilder is adding a deck made with composite materials. Remodeling is the bread and butter for this category, and we see that market continuing strong.”
Mike Descoteaux, marketing manager for Correct Building Products in Biddeford, Maine, makers of CorrectDeck products, agrees. "In talking with contractors, they’re very upbeat and quoting a number of projects already for this coming season.” In fact, as the new-home market becomes tighter, Descoteaux anticipates that decking products may even expand their reach to some production builders who want to attract homebuyers. "Our goal is to differentiate composites from wood and to show how our products are the best for any project.”
More Companies Arrive
Differentiation is a key in decking materials, Long says, because new companies continue to enter the category. "There’s more market here than in other areas, and it’s difficult to differentiate yourself,” he says. "Every major manufacturer has a basic solid deck plank in several colors, and pricing is making that product a commodity. So you have to offer more.” Large companies have more resources with which to expand product lines, he notes, but that doesn’t necessarily spell doom for smaller competitors. "The smaller companies are more nimble and quicker to respond to trends, creating new products more often.”
Tim Machelski, executive vice president at Elk Composite Building Products in Dallas, agrees that the number of companies still in the market has been surprising. "We haven’t seen the shakeout occur to the extent we anticipated by this point,” he says. Even so, he expects early 2007 shows and orders will indicate who has the most staying power.
As a result of this proliferation of products, many dealers have stopped stocking many products and instead, offer special orders, he notes. "There are so many [products] to choose from, and the distribution system has gotten much, much better in the past few years,” he explains. "Good distributors offer fast delivery, at least three times a week, so dealers don’t have to keep products in stock.”
As the product mix grows, marketers are sharpening their pencils and finding ways to make themselves indispensable to their customers, Machelski says. "Price competition has become more important, and aggressive pricing is critical.” In 2007, there probably won’t be many price increases, he adds. "Customers would laugh off any price increases this year.”
That was the case for Rhino Deck in the past year, says Mark Rheum, CEO of Master Mark Plastics in Albany, Minn. "We positioned ourselves at an entry-level pricing level, so we have to watch our pricing very closely, and last year we couldn’t do that due to the costs of plastics,” he explains. "But pricing has come back down now, and we feel good about 2007—really good.” He anticipates 100% growth for the products this year, he adds. "We’ve had excellent acceptance of our materials and colors, but pricing is definitely the driver for our products.”
To avoid pure price competition, several companies are expanding their offerings to create more options. "There are two tacks you can take,” says CorrectDeck’s Descoteaux. "You can offer more feature-laden products that customers are willing to pay for, or you can offer a basic line without the bells and whistles at a lower price.”
Offerings at Lowe’s and Home Depot are making the basic line more basic, he notes, turning deck materials into a commodity in many markets.
Elk introduced an option with a lower price point, which disrupted its sales flow, Machelski notes. The goal was to extend the company’s line to a good-better-best spectrum by supplementing the existing "better” product. But when the company announced the new "good” product was coming, distributors waited to order the higher-end product. "Now, we have a backlog of orders as dealers catch up,” he says.
The goal with the new board is to add market penetration at the lower end to compete better, he explains. "It will make us more attractive to customers who are interested in pressure-treated lumber but want the benefits of a composite board.” He adds that later this year, Elk will introduce a high-end product to complete the trio of options.
"Distributors will have a full range of offerings so they won’t need competing lines to round out their products,” he says. "A lot of companies are taking that approach to the market. They don’t want dealers to need other lines. We want to show our customers that they don’t need the smaller companies to have a complete offering.”
Companies also are stressing the long-term cost benefits of composites, notes Deron Manwaring, national marketing and sales manager for Royal Crown Limited in Milford, Ind. "Consumers are choosing vinyl to save money,” he says. "While vinyl has a higher upfront cost than wood, it lasts longer and delivers a total return on investment in just five to seven years versus wood, which delivers no payback due to its maintenance costs.”
Market Continues To Grow
The growth of the composite-decking market is reflected in market reports and forecasts for the next few years. According to a 2006 report by The Freedonia Group Inc. in Cleveland, U.S. demand for decking will advance 2.8% per year through 2009 to $5.8 billion. "The relative stability of the decking market stems from the fact that more than 85% of demand is generated through repair and improvement activity, which is inherently less cyclical than the new-construction market,” the report says.
Composite materials, while still lagging well behind pressure-treated wood, are gaining ground quickly, the report indicates. Demand for composites is growing between 15-18% annually, while pressure-treated wood demand is growing at between 0.5-1%. "The U.S. decking market has seen a shift in product mix in recent years,” the report says. In 1997, wood accounted for 97% of volume demand, but by 2004, alternative materials accounted for 11% of the market. That report notes that shift will continue through 2009.
The composite market definitely will continue to grow, says Chris Fox, marketing manager for Universal Forest Products in Grand Rapids, Mich. "Homeowners like the ability to have more choices; there is more interest in low-maintenance products; there is plenty of disposable income from an increasing demographic (baby boomers), and there is a lot of need for deck replacements.”
Wood Look Is Paramount
Patty Pellock, marketing manager at CertainTeed, agrees. "People prefer products that are low-maintenance and find there are additional benefits as well.” Benefits include less staining because the products aren’t porous, more durability, resistance to insects and rot, fade-resistance, and, in cases such as CertainTeed’s products, fire-resistance. "Homeowners are seeing the benefit to switching from wood, but they still want that look,” she says.
A recent study by TAMKO Building Products in Joplin, Mo., found low maintenance was key in purchase decisions, according to Stephen McNally, vice president of sales and marketing. Other important attributes? Homeowners said they wanted boards that won’t warp, excellent slip resistance, 25-year-plus warranties, splinter resistance, no painting, staining or sanding, and the look of real wood.
Maureen Murray, marketing representative for Trex Co. in Winchester, Va., agrees. "Composites are appealing more to diehard wood lovers. As much as homeowners and contractors despise maintenance, studies show they still love the look of natural wood.” As a result, Trex has introduced a product with an emphasized wood-grain pattern. "Trex hopes to capture an entirely new audience and convert them to composites,” she says.
For the most part, marketers agree, the learning curve for composites has flattened out. "Homeowners now understand composite products,” says Master Mark’s Rheum. TimberTech has forged a working relationship with the Archadeck franchise system to improve its visibility. Archadeck’s 95 outlets all recommend TimberTech decking in their stores. "It’s creating new markets for us and gaining visibility for our name,” says Brennan.
Color Options Grow
As consumers demand expected benefits, they are also looking for more options, including colors. As a result, many manufacturers have expanded their palettes, particularly in products that can help simulate the appearance of wood. "New colors are being introduced all the time to give homeowners and builders choices,” says Universal’s Fox. The company this year added Sienna to its line to resemble "an exotic tropical hardwood,” he says. This addition complements the existing Redwood, Cedar, and Gray colors.
At CertainTeed, new choices include darker colors, including Redwood, Cedar, and Chestnut. "There’s definitely a trend toward more natural-looking designs,” says Pellock. "Homeowners want to complement and coordinate with the outdoors.”
That also can be seen in new introductions at TimberTech, says Brennan. The company introduced Walnut last year and has supplemented that with Teak and Rosewood this year.
Shailesh Bhat, director of composite products at Dow Building Solutions in Midland, Mich., agrees that the color palette will continue to expand. "We continuously introduce more colors and different surface finishes with the aim of giving customers design flexibility and multiple options.”
In some cases, notes CorrectDeck’s Descoteaux, the choices are regional in nature. New England markets prefer gray, while earth tones are more prevalent as products move west. Log homes use a lot of green deck, to match the typical green trim on the home. "It’s become an individual preference for homeowners, with the goal of making their deck look better and different from their neighbors.”
Homeowners often focus on the deck’s appearance more than any other factor, agrees Geodeck’s Long. "If the homeowner makes the decision, it’s based on aesthetics.” But in many cases, they defer to their contractor for the final choice. "Most consumers have a preference, but typically in eight out of 10 projects, the contractor influences the decision.” TimberTech’s Brennan agrees. "Homeowners are informed about composites and make the choice, but contractors have a huge role in the final selection. The customer respects their opinion and values their input in deciding among the last few options.”
Fastener Systems Are Focus
For that reason, manufacturers are putting more emphasis on the ease of installation, especially with hidden fastening systems. Both of CorrectDeck’s products offer such systems, which are a key selling point, says Descoteaux. "It looks better and it speeds up installation, which is important to the contractor.” GeoDeck has introduced a tongue-in-groove system that provides a stable, good-looking fastening system while cutting installation time as much as 40%, says Long.
"Hidden-fastener systems have become a big attraction,” agrees Elk’s Machelski. The company has introduced a new clip system it says addresses substructure problems that arise after construction. "The new clip firmly fastens boards to the substructure, ensuring the boards won’t slide.”
Railing Options Expand
Railing systems are growing even faster than deck options. "Railings absolutely are becoming more decorative,” says TimberTech’s Brennan. "Railings had been overlooked by the composite manufacturers, who focused on the decks and had basic rail systems. But that’s changed.”
Dow’s Bhat agrees. "As consumers are increasingly using their decks as extended living spaces, accessories have been playing a more critical role in enhancing not only the deck products but also the customer’s outdoor experience.” Dow has added a new line of railings in multiple colors, "and we will continually add to this product line.”
In many cases, homeowners decide which deck products to use based on the railing systems they prefer, notes Elk’s Machelski. Elk has expanded its railing options to ensure it meets customers’ needs, he says. "We want to be the one source for all railings, so we are the one source for everything related to the deck.” Universal Forest Products also has expanded its decorative pieces to feature ornamental balusters, decorative post caps with solar-activated lights, and Tiffany-style Mission options. "We’ve expanded our offering to give contractors and homeowners more options,” says Fox. The company’s Xpress ship program ensures dealers can order as needed, avoiding the need to stock the products.
"There’s been a tremendous upsurge in balusters and panels of new types, including aluminum, iron, and glass,” says Geodeck’s Long. "The designer aspects of all of these products are growing.” Often, customers are focused on decorative balusters at entry points, where they are most visible. "It creates a custom look that stands out.”
Manufacturers note that railing kits have become quite popular, as they include all parts and speed installation. "Our goal is for an installer to be able to assemble a section in less than 30 minutes,” says Mick Whelan, TAMKO’s corporate director of marketing, discussing the company’s new Designer Railing kit. (The kit is aimed at contractors.)
Railing options now have been extended to include fencing as well for many companies. CertainTeed, for instance, offers a range of options, including picket, privacy, and pool fences of varying heights. Its most recent addition is a wood-grain appearance for its PVC Chesterfield privacy fence. "It gives the beauty of natural wood without the hassle of ongoing maintenance or repair issues, such as painting and staining, along with the durability to stand up to the elements,” says Chris Bourque, director of marketing for CertainTeed fence products.
TimberTech will introduce a privacy fencing line of composite material this spring, says Brennan. "We’re seeing a niche open up as lots get smaller, especially in urban areas,” he says. "There’s a big opportunity in that market still.” As homeowners become more familiar with composite materials and grow to know them from their decks, extending railings to fencing will become more natural.
Use Displays Well
The key to selling higher-end products and expanding the sale to more decorative railings and fencing is to display the products well, manufacturers say. Many offer small models, while larger ones can be placed outside to show how well they weather and resist fading. "You have to show customers the unique options you provide that make the outdoor-living area different and add value to the home,” says Universal Forest Products’ Fox.
CertainTeed’s Pellock agrees. "You have to understand your customers’ needs and emphasize the features of the lines you carry to meet those needs.” She stresses the benefit of tapping into training and product-knowledge programs offered by manufacturers. CertainTeed, for instance, will do hands-on training and even job startups with dealers.
Decks represent a strong market that is almost certain to continue to expand and grow, even as other building products adapt to a smaller new-housing market, manufacturers say.
"There’s more market available at the upper end still today,” says Geodeck’s Long. "We haven’t yet seen the ceiling for the consumers’ appetite for composite products.”
Wood Treatments Expand To Meet Competition
Although composite deck products are gaining visibility, pressure-treated wood remains the dominant material choice for consumers, who like its natural beauty and low price. Companies who produce pressure-treated wood are fighting back to regain the ground lost to composite materials.
"Pressure-treated wood will remain the most important product for decks this year and in coming years, due to its economy and the appeal of the look of wood,” stresses Huck DeVenzio, manager of marketing communications for Arch Treatment Technologies in Smyrna, Ga. However, wood’s market dominance has begun to weaken as composite materials tout their reduced maintenance needs and other durability attributes.
"Wood has lost some share, there’s no doubt,” says Dave Fowlie, vice president of business development at Viance, a joint venture between CSI and Rohm & Haas Wood Biocides formed in early 2007. "But wood has the opportunity to reestablish itself with better weathering capabilities and regain some share.”
Indeed, several companies are introducing new treatments that will overcome some of the drawbacks that consumers have found with treated-wood products. First and foremost are changes in treatment chemistry that reduce or eliminate the copper content that has concerned homeowners. "The concern over past treatments was overblown, but the concern was there,” says DeVenzio. "The new treatments can offer reassurances on that absolutely.”
New Treatments Introduced
Arch Wood’s new product has no metal content at all, DeVenzio says. It also provides a truer color to the wood, with none of the green tint for which pressure-treated wood is well known. In fact, the company is considering adding a slight tint to the colorless treatment just to distinguish the wood as treated. "It helps make stains more accurate,” he says, adding that it’s also less corrosive, since there is no metal to react with metal or nails.
The company introduced the product earlier this year and is rolling it out to treatment plants through the year, DeVenzio says. He also notes that the treatment is no more expensive than previous copper-based applications.
Osmose also is introducing a new treatment, says Gary Converse, senior vice president at the Griffin, Ga.-based company. MicroPro offers an alternative to current copper-based preservatives that provides added benefits. The material is lighter in color than past treatments and offers low corrosion for fasteners.
It’s the first material approved for direct contact with aluminum, he adds. "This allows contractors to use traditional materials, including aluminum flashing and connectors. If the fasteners are code-approved, they can be used with wood treated with MicroPro.” This provides a key benefit for builders who in the past avoided aluminum flashing by using expensive copper options or even stainless-steel fasteners.
He says the product has been rolling out nationwide since last May, and already has been used on more than 1-billion board feet of wood in states east of Colorado. "It’s being very positively accepted, because the colors are true. It’s more natural looking and ensures no corrosion.”
Viance is gearing up for its introductions from the new collaboration as well, says Fowlie. "We formed our group to take advantage of the bio side of Rohm & Haas and polymer technologies,” he explains. The first product, Ecolife, is a preservative treatment with additional organic stabilizer that resists weathering, decay and termites. The treatment is 100% organic, he notes.
"We expect this treatment will help us regain some of the deck-top and specialties market that has been lost to composites,” he says. "Composites are still gaining market share, but they have some issues with performance that leaves the door open for us.”
Goodbye, Green Treated Wood
The changes come at a time when consumers are considering new options and want stronger aesthetics. "We’re seeing more painted and stained decks, with more colors being used than in the past,” says DeVenzio. "Homeowners want to match the trim and painted exteriors on their homes, and our treatment will ensure they get a truer color when they paint.”
Viance, in fact, will be launching a line of factory-colored products later this year, Fowlie says, to tap into that market.
"There’s a real opportunity for adding color to wood. We’re finding a lot of interest among homeowners, who are reacting well to that idea,” he says.
Those treatments, applied to products that consumers are familiar with, will create a stronger selling message. "We have a great product,” says Fowlie. "Wood is a great thing, and consumers want it. Now we’re adding new technologies to improve the weathering capabilities and application properties of the wood to give consumers what they want: a natural wood product with strong weathering.”
The American Wood-Preservers’ Association also is expanding the visibility of treatments by adding a Barrier Preservative System to its 2007 Book of Standards. The group says the new standard, P20-07, was developed by Postsaver USA to extend the association’s expertise and knowledge base to this system of wood protection. The standard requires barrier systems to submit data demonstrating suitable performance prior to listing of the specific system in the standards book.
To learn more about these companies’ products, visit these Web sites:
- AERT: www.moistureshield.com
- American Wood-Preservers’ Association: www.awpa.com
- Arch Wood Products: www.wolmanizedwood.com
- Brite Manufacturing: www.britemfg.com
- CertainTeed: www.certainteed.com
- Composatron: www.composatron.com
- CorrectDeck: www.correctdeck.com
- Dow: www.dow.com
- Elk Building Products: www.elkcorp.com
- Geodeck: www.geodeck.com
- Luxwood (deck design software): www.luxwood.com
- Osmose: www.osmose.com
- PostSaver USA: www.postsaverusa.com
- Rhino Deck: www.rhinodeck.com
- Royal Crown: www.royalcrownltd.com
- Seljax International (deck design software): www.seljax.com
- TAMKO Building Products: www.tamko.com
- TimberTech: www.timbertech.com
- Trex: www.trex.com
- Universal Forest Products: www.universalforestproducts.com
- Viance: www.treatedwood.com
CRAIG A. SHUTT, senior contributing editor of the magazine, has nearly 30 years experience covering the LBM industry.
|Word of mouth||20.68%|
|One more try||13.8%|