One-on-One with Bob Daniels
 
January 1st, 2004

By Cathy Szmurlo
Jan-Feb 2004

For nearly sixty years, the Tile Council of America (TCA) has focused on expanding the U.S. ceramic tile market. Today, the council’s membership represents over 80 percent of U.S., Canadian and Mexican tile producers. Acting as an industry resource, the council offers guidelines for tile installation, provides relevant publications and conducts product and performance testing for its members. The Ceramic Tile Education Foundation, created in 1996, educates professionals about selling and installing ceramic tile through training classes.

TileDealer asked Bob Daniels, executive director of the council for nearly ten years, to give us an overview of recent changes in the ceramic tile industry. Daniels attended a seminar for major tile producers in early December in Criciuma, Brazil, where he presented on the state of the U.S. ceramic industry. His comments from the seminar plus our interviews pinpoint vital trends, challenges and changes in the industry and the council itself.

TileDealer: Before we talk about changes in the ceramics industry, can you update us on any news about the Tile Council?

Daniels: We have just announced that, effective immediately, we have changed our name to the Tile Council of North America. With NAFTA allowing for free trade between the U.S., Canada and Mexico, we see ourselves functioning as more of a coordinated industry. Although the Canadian tile industry is not very large, Mexico has five large ceramic producers. We will now be working together to promote tile, education, standards and environmental issues like factory air quality and water discharge quality. This name change shows that the council represents not only U.S. producers but also all North American manufacturers.

TileDealer: How will recent economic trends affect the tile industry?

Daniels: The U.S. economy has grown in the last two quarters of 2003, with unemployment decreasing and the gross domestic product making a jump. However, this period has been a jobless growth period, since employers are hesitant to add people, automation has increased and labor-intensive manufacturing has declined.

Despite this, I think recent tax cuts will have a positive effect on the economy. These cuts will mean most taxpayers will increase their take-home pay and the extra cash is either spent on consumer goods or invested. Either way, there is a trickle-down effect.

In terms of trends that can effect tile sales, with interest rates remaining low, home sales are increasing. With the dollar declining in value, a negative for the industry is that imported tile prices have risen. The U.S. is the largest importer of ceramic tile in the world, with about 78 percent of ceramic tile imported into the U.S.

But the demand for ceramic tile is still strong, with the strongest segment of the market coming from home remodeling. Total tile sales have increased by over 8 percent in the first half of 2003 over the same period in 2002. Sales have doubled in the past seven years and we expect 2003 to end on a strong note.

TileDealer: Why do you think tile sales are stronger right now? Daniels: There seems to be an inherent demand for ceramic tile. Tile has penetrated the market of other products and it is taking market share away from those products. For example, carpet has stayed at a certain percentage of the market while ceramic tile has increased its percentage. Tile is popular now because of:

• Better availability of tile. It is now sold in more retail floor covering stores, making it available to more consumers.

• Prices are good. Tile pricing has become more affordable for the middle class.

• More people are exposed to ceramic tile and its uses than ever before. As people travel around the world, they see what can be done with tile.

• Houses are bigger, and so are the rooms that typically use tile, like kitchens and baths.

TileDealer: What societal trends are helping to increase the popularity of tile?

Daniels: The U.S. consumer is demanding new tile styles and sizes. The use of interior designers is moving into the middle class and many are designing with tile. Baby Boomers are demanding high fashion in their homes and tile allows people to express themselves. Unlike sheet vinyl, you can do so much with it. In addition to using tile in bathrooms, I’m hearing a lot about home steam rooms. Tile is an excellent product for wet areas. Also, tile that mimics natural stone products is very popular.

TileDealer: What are some of the challenges the industry, and dealers in particular, can expect to face?

Daniels: There is clearly a lack of trained installers and personnel in the distribution and sales areas. I think young people today do not see the construction trades as desirable occupations. Many that install tile are woefully under trained.

To improve that, people have to realize there are classes available. For instance, the CTDA has Tile Training in a Box. Other organizations offer classes. At the retail level it is harder to get people motivated to go to school. Smaller shops just don’t have the time. Some train one or two key personnel to act as the lead person in that organization. But it’s just not easy to motivate them.

A lot of retail floor covering stores that now sell tile are used to selling sheet vinyl and carpet. They have to realize they can’t put tile anywhere and they have to understand the subtleties of the product. Carpet can go over everything; tile is not flexible.

New building materials and faster construction adds to the challenge of proper usage and installation of tile.

Environmental concerns including air and water quality plus the demand for recyclable materials are being studied. While tile is long lasting, it is not easy to dispose of after tear out. Ways to use industrial and municipal waste when producing tile are being studied also.

TileDealer: What positive changes can you predict for the ceramic tile industry?

Daniels: I can make several predictions about the industry.

• Tile sales will continue to increase in the U.S. and consumption will double in the next 10 to 15 years.

• Better training institutions are being developed already. For instance, the Ceramic Tile Education Foundation is teaching more tile installers in 2004 than ever before.

• Technology in home construction and tile installation products will improve. Newer tools will make the work easier.

• Tile production itself is continuously improving and there will be more productive capacity added to U.S. factories. Highly automated factories will take the place of low volume facilities. By working to educate the consumer, installer, salesperson and everyone in the ceramic tile chain, we can reach our highest goals.

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