Market Dynamics
Global outdoor flooring market drivers
Increasing use of thermally treated wood
Thermally treated wood has recently gained popularity, increasing acceptance among end users in commercial and residential sectors. Thermally treated wooden tiles offer a combination of weather resistance, water repellency, and dimensional stability. A further factor driving the expansion of the outdoor flooring market is the need for thermally treated timber parquets for decks and swimming pool areas, particularly in Europe. For instance, consumption of hardwood parquet goods increased dramatically in 2019 in nations including France, Poland, Spain, and Austria, according to the European Federation of the Parquet Industry (FEP).
Global outdoor flooring market restraint
Foreign exchange fluctuations affecting business margins
The global economic slowdown and the skyrocketing property costs in industrialized economies significantly impacted the market in the previous ten years. In addition, Brexit and the U.S. and China trade wars have significantly affected global trade, affecting local currencies' exchange values. As a result, the housing market in developed economies is still recuperating from the recession and stabilizing inflation rates. Global trade restrictions have impacted the whole value chain of the outdoor flooring business due to the rise of raw material prices. For example, the United States slapped a 25% tariff on products from China, including the raw ingredients for solid hardwood.
Global outdoor flooring market opportunities
Increased awareness of outdoor remodelling
The trend toward outdoor home remodeling among residential end-users, particularly in urban areas, has changed due to the rise in disposable income of people and the increased awareness of exquisite outdoor designs. Likewise, curb appeal, also known as the property's attractiveness, is crucial when updating the exterior of a residential building because most buyers prefer remodeling before buying or renting a home. Additionally, a digital marketplace called Home Advisor reports that from 2018 to 2019, customer spending on home repair projects climbed by almost 17%.
Regional Analysis
The global outdoor flooring market is divided into four regions: North America, Europe, Asia-Pacific, and LAMEA.
Asia-Pacific is the most substantial shareholder in the global outdoor flooring market and is expected to grow at a CAGR of 6.20% during the forecast period. Asia-Pacific is anticipated to experience the outdoor flooring market's most lucrative growth rate due to its quickly increasing building industry and easy access to raw materials. Additionally, rapidly developing economies like Bangladesh, India, Malaysia, China, Indonesia, and Malaysia see increased infrastructure development and new construction projects. This opens up various outdoor flooring options in commercial structures like offices, bus and train stations, malls, airports, and educational institutions.
LAMEA is expected to grow at a CAGR of 6.65% during the forecast period. Increased demand for commercial and industrial infrastructure due to rising urbanization drives the market expansion in LAMEA. The market for outdoor flooring is anticipated to expand more quickly due to the substantial growth of the building industry and infrastructural development. Additionally, an improved business climate and a rise in construction spending, primarily from Latin America and Africa, support market expansion. Due to population growth and rapid urbanization, the UAE and Qatar remain viable investment locations. In addition, the Brazilian government has created several programs to promote real estate expansion, including FINAME and Agencia Especial de Financiamento Industrial (FINAME). These elements fuel the expansion of the outdoor flooring market in LAMEA.
Europe is one of the top regions for producing and exporting outdoor flooring. Due to the region's frigid climate, wood, composite wood patio, and parquet usage are much more significant. In order to boost the building and renovation industry, the region is also focused on resource efficiency and investing in eco-friendly technologies under the European Green Deal initiative of the European Commission. The initiative also promotes renovating both public and private structures to reach double growth rates. The commission also intends to establish a platform for architects, engineers, and local governments in the building industry to encourage energy-efficiency investments in structures and renovations of private and public facilities, including schools, social housing, and hospitals.
North America is expected to grow steadily over the forecast period. The outdoor flooring market is driven by high consumer expenditure on home decor and an increase in renovation and house improvement trends, particularly in the United States and Canada. Most people in industrialized nations like the U.S. and Canada spend a lot of money, which increases the need for luxury outdoor flooring for residential and commercial structures. In addition, the U.S. holds a sizable portion of the regional market for outdoor flooring. Over USD 400 billion is spent annually on house restoration and repairs, according to Joint Center for Housing Studies at Harvard University in the United States.
Segmental Analysis
The global outdoor flooring market is segmented by material type, flooring type, construction type, and end-user.
Based on material type, the global market is bifurcated into wood and laminate (decking), ceramic (tiles), synthetic fiber and fabric (carpet and rugs), and others.
The ceramic (tiles) segment is the highest contributor to the market and is estimated to grow at a CAGR of 5.70% during the forecast period. Ceramic tiles held a substantial market share for outdoor flooring in 2022. These tiles' design, color, and texture flexibility dramatically contribute to a sizable market share. For instance, thanks to technological breakthroughs, ceramic tiles can now be produced with textures and appearances precisely like those of wood, concrete, stone, and terrazzo. Furthermore, they are the perfect material for outdoor flooring solutions due to their versatility, high mechanical susceptibility, low maintenance requirements, and durability. Hence, ceramic tiles can be employed as outdoor flooring in a range of commercial, educational, and office buildings.
Outdoor wooden and laminate flooring is typically used in homes, vacation spots, hotels, parks, and dockyards. Furthermore, commercial ports, marinas, and resorts also extensively use wood for decking purposes. Wooden flooring materials are typically used for their aesthetic value and visual appeal due to their low durability and less robust flooring. Further, wood flooring is frequently more expensive because wood is scarce. As a result, the property's curb appeal increases, increasing its resale value. This encourages consumers to use wood as a common material for outdoor flooring.
Based on flooring type, the global market is bifurcated into resilient and non-resilient.
The non-resilient segment owns the highest market share and is estimated to grow at a CAGR of 5.70% during the forecast period. Hard, rigid flooring materials, including stone, ceramic, porcelain, tiles, and wood, make non-resilient flooring. It is an attractive option for outdoor flooring because it comes in various solid colors and sizes with patterns, surface finishes, and heat-resistant capabilities. The market for non-resilient outdoor flooring is experiencing increased demand due to technical developments in digital printing technologies. In addition, the global market for non-resilient outdoor flooring is expanding due to rising urbanization and expansion in the construction industry. Additionally, attributes like simplicity in cleaning, water resistance, durability, and improved comfort encourage its use in the home and commercial settings.
Resilient flooring is gaining popularity as a result of features, including durability and design options. They are frequently utilized in outdoor lobbies, restaurants, halls, and corridors. Resilient flooring is used in commercial buildings to reduce slip and fall injuries to visitors and employees. Many producers of outdoor flooring have made business expansion their primary developmental strategy to increase the variety of their product offerings and survive the fierce competition.
Based on construction type, the global market is bifurcated into new construction and renovation.
The new construction segment is the highest contributor to the market and is estimated to grow at a CAGR of 5.75% during the forecast period. Tiles are laid for newly constructed homes, buildings, office complexes, and other structures. In Asia-Pacific, between 35% and 40% of people live in metropolitan areas, which drives up demand for additional housing units used as residences. Therefore, the market for outdoor flooring will expand as housing demand rises. One key element driving new development's expansion is the outdoor flooring market. Furthermore, the growing population migration in Europe has brought the necessity for new construction. The adoption of floor tiles is anticipated to benefit from all recent advancements in the construction sector.
Restoration of a standing structure is referred to as renovation. In order to improve the appearance of clothing, floor tiles are replaced when renovating historic buildings and homes. Many businesses implement tactics to grow their customer base and production capacity to survive the fierce competition and enhance their product offerings. For instance, U.S.-based Ecore International, Inc. introduced Crossing Rx, a new range of flooring for its Rx Collection flooring, in July 2020. There are eight neutral colors available for Crossing Rx. Also, rolls measuring six feet broad are available.
Based on end-user, the global market is bifurcated into residential, commercial, public infrastructure, and others.
The residential segment owns the largest market share and is estimated to rise at a CAGR of 5.75% during the forecast period. Row houses, bungalows, villas, and condos all have porches, patios, backyards, and pool borders where outdoor flooring is used. The outdoor flooring industry is growing due to gradual population expansion and increases in the majority population's disposable income in several developing nations, like India and Brazil. Additionally, it is anticipated that the growing trend of remodeling and renovations in developed nations like the U.S., the U.K., and Germany will fuel market expansion in these countries.
Public facilities, including airports, bus and rail stations, governmental institutions, parks, ports, and utilities, draw significant crowds of people. Large expanses are required for this, which are protected by outdoor flooring. Moreover, the COVID-19 epidemic has negatively affected global economic development, according to the International Monetary Fund (IMF), in 2020. However, it is projected that an increase in public investments will stimulate the world economy by expanding its supply-side potential. Public-private partnerships (PPPs) can provide additional support for constructing public infrastructure. Therefore, increased public infrastructure construction throughout the projection period would present opportunities for outdoor flooring market expansion.
Particularly in developing countries like India, Brazil, and China, it is projected that rising economic growth and an increase in manufacturing industries will fuel the development of institutional and industrial infrastructure. In addition, the aerospace and military sector is anticipated to concentrate on digital transformation due to geopolitical circumstances, including Brexit and the U.S.-China trade dispute. Demand for the expansion of aerospace infrastructure is driven by rising consumer spending on commercial air travel and an increase in international trade, particularly from Asian and Latin American nations. All these elements drive the need for outdoor flooring, which drives the worldwide expansion of the outdoor flooring market.
