Key Trends In The Synthetic Decking Market

Posted on 11:30 pm | Posted in WPC Decking Blog | Posted by Admin

Wood regained market share in 2009 and 2010 after a prolonged growth period where synthetic decking posted significant market share gains over wood. Recent share gains by wood were partly due to product substitution manifested in the growing price gap between composites and pressure-treated lumber. The introduction of new ultra-low maintenance decking products combined with a modest recovery in the housing industry and increasing consumer confidence will help synthetic decking and railing reverse this trend.

Critical factors driving the synthetic decking share and substitution of wood are pricing and performance. Uncapped composites will continue to have a role in the market, especially the low-price point boards that offer consumers a low-maintenance alternative to wood. Superior performing, low price point uncapped WPCs should continue to fulfill a market niche.

Composite Porch Decking

Synthetic Decking Market-WPC Decking Materials

Performance of ultra-low maintenance decking is an extremely critical factor that will ultimately determine the long-term success of the synthetic decking market. Many clients, contractors, dealers and distributors (and suppliers) have been financially hurt by products that failed. If ultra-low maintenance products installed in 2010 shows great and sustainable performance beyond 2013, the adoption of synthetics decking is set to increase further. Overall, the WPC and cellular vinyl market has a great opportunity to grow its market share in the next five to ten years with the right products that meet customers’ expectations.

Channel dynamics have changed considerably since the economic downturn. Industry consolidation, mainly through attrition, and the desire to reduce working capital by reducing inventory, has made the pro and big box retailers more reliant on 2-step wholesalers. As a consequence, 2 steppers have become even more important for the movement of synthetic decking and railing products. On the supply side, the decking and railing market is highly concentrated with the top suppliers accounting for a majority of market share. Inexperienced entrants especially in the WPC/cellular vinyl category have had a difficult time in establishing channel relationships with key two-step and big box retail companies. Also, the increasing reluctance by channel partners and contractors to try different ―me-too products has made it all the more difficult for new entrants to gain a foothold in the market. Companies should have a compelling value proposition and financial stability to convince channel partners to distribute their products.

Contractors and dealers form an important part of suppliers’ customer base. Successful suppliers work every step of the value chain to provide support services and to develop healthy relationships to help create demand pull. The survey conducted with the contractors and dealers revealed the most desirable services by these entities include rebates, site drop off, improved warranty services, product display, and training. Thus it is imperative for suppliers to invest in downstream client services as it is one of the key areas critical to their success and to create pull-through demand.

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