wpc decking price snapshot. spanish market 2015 (sample)

Market Snapshot Spanish WPC decking market 2014

2015OneGrow.Allrightsreserved.Anyunauthorizeduse, includingbutnot limitedtocopying,distributing,transmittingorotherwiseofanydataappearing isnotpermittedwithoutauthorspriorauthorization.Theinformationcontainedhereinhasbeenchecked,butinnoeventshalltheauthorsbeliableforanyspecial,incidental,orconsequentialdamages,arisingoutoftheuseofthedata.

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WPC DECKING PRICE OVERVIEW Spanish market-Feb 2015

MARKET SNAPSHOT REPORTS

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Other available Snapshot Market Reports.

1. WPC SPANISH MARKET OVERVIEW Context and market development Market volume Market trends in 2014

2. PRODUCTS OVERVIEW Type of products in the market Most accepted products in the market last year Dimensions, finishing and colors

3. DISTRIBUTION CHANNELS WPC decking distribution channels overview Distribution channel:

Traditional distributors: Wholesalers and Distributors Big-Medium-size DIY store chains Regional & urban DIY store chains

4. SUPPLY: Players and Volume Supply from domestic manufacturers Imported products Supply from other European manufacturers

5. MARKETING MIX: What

companies are doing to promote their products? ATL and BTL Marketing activities Online Marketing Merchandising Trade fairs: WPC-outdoor/landscape related trade shows.


2015OneGrow.Allrightsreserved.Anyunauthorizeduse,includingbutnotlimitedtocopying,distributing,transmittingorotherwiseofanydataappearingisnotpermittedwithoutauthorspriorauthorization.The informationcontainedhereinhasbeenchecked,but innoeventshalltheauthorsbe liableforanyspecial,incidental,orconsequentialdamages,arisingoutoftheuseofthedata.

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3. WPC DECKING PRICES

The prices analysed in this chapter are B2B prices for WPC decking profiles without fixing systems, ex-factory or ex-warehouse, and do not include VAT. In other words, the prices covered are primarily those offered

by domestic or regional manufacturers

and/or importers-distributors to traders or installers. The only end consumer prices

referenced are those in the DIY sector, also

without VAT included. All prices refer to 2014.

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The market split into four key price ranges, from 00/m2 to 00/m2.

Products are clearly positioned in different price ranges, in line with

where they are produced.

Over the last three years the average price has fallen by around 00%.

The low-end price range has seen the greatest growth in sales volume over the last three years, up 00% in 0000 alone.

The forecast for the average exchange rate EUR/USD through 2015 places a question mark on sales growth for products imported from outside the Euro-zone. In this context, prices in euros would have to be increased around 18% in order to maintain profitability in 2015.

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3.1 OVERALL PRICE RANGES The Market splits into four price ranges: 1) HighTier, 2) Mid-high tier, 3) Mid-low tier and 4) Low tier. Each price range brings together products from different brands, manufacturers and backgrounds. In this way, the current market price range is 00-00/m2, from low-end products such as the hollow, sanded-finish profiles manufactured in China through to premium level capped solid profiles from the leading US brands. 3.2 PRICES BY ORIGIN AND PRODUCT TYPE. Products are clearly positioned in different price ranges, in line with where they are produced. As such, products Made in USA, mainly solid boards, dominate the high price range of 00-00/m2, which covers the whole selection of profiles: Standard, Co-ex, Capped and Cellular PVC . The US players present in the market are Timbertech and Fiberon. The mid-high price range of 00-00/m2 covers some European manufacturers and, in part, overlaps with the lower prices of the high-end range. It also accounts for

the Capped products Made in China, to which the market has responded very positively thus far. Worth considering in this price range is the fact that some European manufacturers sell directly to installers, as their prices would not be competitive otherwise. Continuing downward, in the mid-low range of 00-00/m2 we find the local-regional manufacturers with hollow and solid profiles. In some cases, these also sell directly to installers. Finally, the low price range of 00-00/m2 comprises the hollow profiles Made in China, with standard sanded finish. This segment accounts for the largest growth in sales over the past three years, through competitive pricing. In terms of those products sold through the DIY channel, most prices fall within the 00-00/m2 range (planks and/or tiles). Given the high level of price dispersion, however, it is possible to encounter prices of 00-00/m2 for similar products in different retail chains. In this sense, it is worth pointing out that some chains sell WPC decking in a PRODUCT + INSTALATION format, both for solid and hollow profile boards. The price range is 00-00/m2, slightly higher than the price per m2 for comparable products offered by professional installers to the same type of clients.



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In all, considering the current price ranges from the traditional distribution channel, the main distribution channel for WPC decking in Spain up to now, the average B2B market price for the whole WPC decking category is around 00-00/m2. Over the last three years the average price has fallen by around 00%, with very significant price elasticity of demand. 3.3 PRICE DEVELOPMENT In general, over the period 2012-2014, all

the B2B price ranges have seen a reduction in their lowest prices of around 00%. For the US-made products this has been due to product line extension with more competitive prices, while competitive pressure has been the key driver in the case of products manufactured in Asia. The lowest market prices for Asian commodity products has fallen from 00/m2 to 00-00/m2, although this has been offset by significant growth in sales volume.

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B2BDOMESTICPRICES2014(VATexcluded)

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WPC deckingboardspricesbyproductlineandbrand

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AVGMARKETPRICE



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Regarding the high-end segment, the entry-level price hasfallen some 00%, to 00-00/m2. Prices from European and domestic-regional manufacturers have also suffered a downturn, although more moderate, given the band width of this segment. As far as substitute products are concerned, the price trend has been upward too, with ipe wood decking from Brazil around USD2000-2500/m3 FOB Belem-Paranagua. At a national level, prices stand at around 00-00/m2 for a reliable quality product. Nevertheless, imports of ipe wood have grown around 00% despite the limited supply, the rise in the exchange rate and an increase in prices. 3.4 WHICH PRICES HAVE WORKED BETTER IN RECENT YEARS? The low-end price range of 00-00/m2 has seen the greatest growth in sales volume over the last three years, up 00% in 0000 alone. This confirms operators traditional focus on pricing as a means to gain market share, and the sensitivity of the Spanish flooring market to prices, a sector largely dominated by value-priced products. The trend in sales growth will continue at least over the next three years, with two-digit growth rates expected.

However, the consensus forecast for the average exchange rate through 2015 is 1.07-1.10 USD/Euro, which places a question mark on sales growth for products imported from outside the Euro-zone. In fact, imported products represents more than 00% of total of the market. In this context, prices in euros would have to be increased in order to maintain profitability, while products manufactured in Europe would recover competitive edge.

In all, and following the traditional pattern in the Spanish market, relevant growth can be expected at the two price-range extremes: a) High range (quality performance) and b) Low range (value-

RANGE A Brand 1 product A, Brand 1 product 2, Brand n product n

RANGE B Brand 2 product A, Brand 3 product 2, Brand n product n

RANGE C Brand 4 product A, Brand 5 product 2, Brand n product n

RANGE D Brand 6 product A, Brand 7 product 2, Brand n product n



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priced). The latter will account for the most significant expansion, while the mid-range

is expected to suffer the greatest competitive pressure.

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wpc decking price snapshot. spanish market 2015 (sample)

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