One-on-One with Jim Dougherty
 
July 1st, 2004

 

By Cathy Szmurlo July-August 2004

Jim Dougherty is optimistic about the growth opportunities in the ceramic tile market – despite foreign competition. And he has good reason to be. He’s witnessed the commitment by U.S. manufacturers like Crossville to their own high quality products and, increasingly, to outreach efforts into poorer communities.

As vice president of marketing and business development for Crossville Inc., Dougherty has seen the company grow to become the largest domestic manufacturer of porcelain stone. “We started 18 years ago as the first major manufacturer of porcelain stone in the U.S. and through that became the number one producer,” he said.

Crossville’s state-of-the-art plants manufacture tile sizes ranging from 3- by 3-inches up to 18- by 18-inches. Dougherty points to the tile’s through-body color and wear resistance among other qualities that make it conducive to both commercial and residential applications.

Dougherty started with Crossville 13 years ago, after about 12 years in the tile distribution and manufacturing arenas. He’s upbeat about the company’s involvement in Tile Partners for Humanity (TPFH), a partner organization with Habitat for Humanity that was started about two years ago. Through it, ceramic tile manufacturers, distributors and contractors supply products, installation, financial support and volunteer hours to the Habitat for Humanity organization across the country.

As one of the TPFH partners, Crossville gave assistance last year by donating 6,000 square feet of floor tile to the 2003 Jimmy Carter Work Project in La Grange, Georgia. The donation helped tile 21 homes in the project.

In a recent interview, Dougherty talked with TileDealer about these volunteer opportunities along with issues of foreign competition and the changing marketplace.

TileDealer: The Census Bureau has reported that the March 2004 value of construction put in place rose nearly 8-percent higher than March 2003 numbers and the total for the first quarter of 2004 is 6.9-percent higher than in the same period of 2003. Do you see a correlation between these numbers and tile sales?

Dougherty: I’d like to say there is a correlation with tile sales, but I think it’s inflation. We’re hearing loud and clear about a good amount of inflation transpiring in the marketplace – inflation in building material sales across the board. And there’s no doubt that tile has become a more desirable floor covering. But I don’t know if you can tie the growth in expenditures in housing with any sort of growth in the tile market.

TileDealer: Is your company’s tile market more residential or commercial?

Dougherty: It is skewed more towards the commercial market, which is relatively flat if not shrinking. We don’t anticipate that much growth this year.

TileDealer: Where do you think the next growth marketplace will be for your company?

Dougherty: For ourselves, the residential market is still a tremendous growth opportunity. But we’re only 4 ½-years into our program, so we will have to wait and see.

TileDealer: How does porcelain tile rank as far as popularity compared to other types of tile?

Dougherty: It’s the fastest growing sub-segment of the tile market. It’s more popular than in the past, and I don’t anticipate any slowing down in that development. It will be a major segment of the overall U.S. market in the years to come.

TileDealer: What percentage of the market does it represent?

Dougherty: It’s difficult to say, but it’s most definitely the fastest growing segment. Porcelain tile is used pretty broadly across many different types of installations.

TileDealer: With the Euro continuing to be strong, how has competition from Italian and Spanish imports been affected?

Dougherty: I don’t know that it has yet. Euro-based companies have not raised prices much on existing product lines, but they have raised some on some newer products. I haven’t seen any major changes.

TileDealer: Do you anticipate any changes?

Dougherty: No doubt there will be some. Some of our distributors are looking for an alternative means to source product.

TileDealer: How will Chinese imports effect the market – now and in the future?

Dougherty: Chinese imports will affect the market, and they already have. I’ve seen the impact mostly in builder grade and tract housing. I don’t fully know the effect yet. There are some unique importing issues. People need to analyze the entire cost of the transaction – more than the actual cost of production.

TileDealer: What do distributors say?

Dougherty: We haven’t seen a lot [of competition] yet. We’re talking to distributors and [the imports] are beginning to infiltrate the market. We see a potential impact on the market.

TileDealer: How will it impact your company competitively on the West Coast?

Dougherty: It’s probably impacted more distributors on the West Coast than the east but I think Chinese material will eventually have an impact across the board.

TileDealer: What role does your company play in the Tile Partners for Humanity program?

Dougherty: We play an active role in the program. We’ve been a major supplier of tile to them for quite some time.

TileDealer: What role do you think other American manufacturers should play in the program?

Dougherty: Tile Partners for Humanity is a separate organization set up to assist Habitat for Humanity in developing uses for tile in Habitat homes. I think anybody dedicated to the growth of ceramic tile across the board should be involved. It’s a valuable outreach program for the U.S.

TileDealer: How can the level of participation be increased?

Dougherty: Just through more awareness. They’re working very diligently to develop a core base for the program. It’s relatively new – only about 2 years old.

TileDealer: What do you want TileDealer’s more than 10,000 readers to know about Crossville?

Dougherty: Just that we’ve supported CTDA and all its efforts for many years and will continue to do that. We’re very dedicated to the U.S. market.

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