Carpet & Rug Manufacturing

Carpet & Rug Manufacturing

Brief Excerpt from Industry Overview Chapter:

Companies in this industry manufacture woven, tufted, and other types of rugs and carpet using natural and synthetic fibers. Major companies include Engineered Floors, Interface, Mohawk Industries, and Shaw Industries (all based in the US), along with Balta (Belgium), Oriental Weavers (Egypt), and Suminoe Textile (Japan).

COMPETITIVE LANDSCAPE

Demand for carpeting depends on residential and commercial real estate construction and home sales, which can be cyclical. With many costs fixed, profitability of individual companies depends on their volume of business. Large companies enjoy significant economies of scale in manufacturing and distribution. The US industry is highly concentrated: the 50 largest companies account for over 95% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

Most carpeting is made on large tufting machines that use rows of needles to sew loops of nylon thread into a latex backing. The loops are cut to produce tufts and additional backing is glued on to the bottom to hold the tufts in place; polypropylene and polyester thread are also used. Rugs and woven carpeting are made on looms using wool, cotton, silk, or synthetic thread. Most carpeting is made as 100-foot rolls ("roll goods") of various widths - mainly 12 or 15 feet ("broadloom") - but modular carpet tiles also are made. Major products include roll carpet and rug goods (about 55%), automobile and aircraft carpet (about 10%), finishing for tufted carpet and rugs (about 5%). Other products account for about 20%.