· web viewaccording to a survey of 17 dyeing and finishing factories (processing almost all...

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2013 General State of the Interior Fabrics Business and Market Size

Determination

JAPAN

September 2014

Nippon Interior Fabrics Association, JAPAN

1

General Remarks

The Interior Fabrics Market

Window treatments 206.6 billion yenFloor coverings 249.2 billion yenWall coverings 114.3 billion yen

In the interior fabrics industry in fiscal 2013, the Japanese market showed overall positive growth continuing from

the previous year, calculated at 570.19 billion yen (an increase of 4.8% from the 544.28 billion yen of the previous

year). This marks four years of continuous growth.

As a result of the worldwide recession caused by the “Lehman Shock” in September 2008, the interior fabrics market

experienced a steep decline of approximately 20% in the years that followed. More recently there has been a gradual

upswing and in 2013 the number of new housing starts significantly increased, pushed by last-minute demand for

new housing before the consumption tax hike, preferential tax breaks for buyers of residential houses and the

“Abenomics Effect”; the market recovered to 88% of its 2007 value. (Refer to Reference Material “Shifts in the Size

of the Interior Fabrics Market” on page 4).

The number of new housing starts in the 2013 fiscal year was up 10.6% from the previous year to 987,000,

continuing a consecutive 4-year increase. In addition, the start floor area for new housing starts was up 9.9% from

the previous year, showing a similar consecutive 4-year increase.

The market size of the three sectors of the interior fabrics market (on a wholesale basis) was calculated at 206.64

billion yen for window treatments (up 5.1% from the previous year), 249.21 billion yen for floor coverings (up

3.4%), and 114.34 billion yen for wall coverings (up 7.2%), with all sectors showing growth.

Window Treatments

The size of the window treatment market in fiscal 2013 was calculated at 117.4 billion yen for curtains (up 6.0%

from the previous year), 28.34 billion yen for blinds (up 1.7%), 36.04 billion yen for screens (up 5.8%) and 24.86

billion yen for curtain rails (up 4.1%), with a total market size of 206.64 billion yen (up 5.1%).

Domestically produced curtains rose to 91.6 billion yen (up 3.5%) and imported curtains rose to 25.8 billion yen (up

15.7%), with both types exceeding the previous year’s performance. Favorable effects are being felt from a

significant rise in the number of new housing starts and from stimulated reform demand. In addition, the steep

increase of imported curtains is the result of low-priced products being imported as well as a significantly weakened

yen, which is being reflected in some of the higher-end imported curtains.

An independent investigation by the Nihon Curtain Association further clarified the reality of the domestically

produced curtains. Sheer curtain showed a significant increase. This is partly because mirror lace curtains or thermal

insulation curtains, as seasonal products, have become more popular and are in wider use.

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Blinds and screens have increased from the previous year due to the rise in the number of new housing starts and the

start floor area of non-residential buildings.

As for the blinds, electric blinds decreased but the high-function manual blinds showed a healthy increase, up to

21.68 billion yen (up 1.2%). Vertical blind further expanded their demand in the “home-use” market, up to 6.66

billion yen (up 3.4%).

Screen performance exceeded the previous year because the high-end price fabric with its thermal-insulation

function pushed up the unit price. As a result roll screens were 23.41 billion yen (up 7.0%), roman shades were 6.6

billion yen (up 1.2%) and pleat screens were 6.03 billion yen (up 4.3%).

Curtain rails were impacted by the rise in the number of new housing starts and performance was 17.71 billion yen

(up 4.2%). Decorated rails showed an increase of up to 4.14 billion yen (up 3.5%), even though there was an impact

from imported products and a shift to functional rails. Supplies also showed good results of 2.14 billion yen (up

4.9%), indicating a continuous increase because of the wide range of accessories that were widely available.

Floor Coverings

The floor coverings (flooring materials) sector is wide-ranging, including three major flooring materials: fiber,

plastics and wood. In terms of market size, however, we determined the market size of carpets and plastic flooring

materials (vinyl flooring materials), on which the members of this Association rely heavily, the same as we have in

the past.

The market size of floor coverings for fiscal 2013 was calculated at 192.2 billion yen for carpets (up 3.3% from the

previous year) and 57.01 billion yen for plastic flooring materials (up 3.8%), with a total market size of 249.21

billion yen (up 3.4%).

The increase in the market size for carpets is attributed to the significant increase of 10.6% in new housing starts

from the previous year, as well as the surge of the construction start floor area for homes (10.5%) and non-homes

(8.1%). Not only the new housing segment but also the renovation segment showed good performance. However,

while imports showed growth at 107.2 billion yen (up 8.2%), domestic carpets were down to 85.0 billion yen (down

2.3%). Among domestic carpets, woven carpet and needle punch carpet showed an increase (up 2.9% and up 1.1 %,

respectively).

Plastic flooring materials continued up for 3 years. Composition tiles were down to 1.28 billion yen (down 6.6%),

other types of composition tiles were up to 2.28 billion yen (up 4.1%), homogeneous tiles were up to 8.59 billion yen

(up 11.3%). In spite of downs in in-laid sheets, down to 0.48 billion yen (down 22.6%), and other PVC sheets, which

were down to 11.12 billion yen (down 3.0%), regular vinyl flooring sheets were up to 7.69 billion yen (up 1.5%),

anti-slip vinyl flooring sheets were up to 9.73 billion yen (up 7.4%) and cushioned flooring were up to 15.83 billion

yen (up 1.5%).

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Wall Coverings

In the wall coverings sector, the market size was determined based on wallpaper this time as well. The market size

for wallpaper for fiscal 2013 was calculated at 114.34 billion yen (up 7.2% from the previous year). While the

economy is maintaining a gradual recovery, the market size for wallpaper has significantly increased over the

previous year mainly because of last-minute demand before the start of the consumption tax increase.

The total volume of domestic wallpaper shipments showed growth with an increase of 7.0% over the previous year,

to 725.09 million m2—exceeding 700 million m2 for the first time in the last six years. This is a result of the

shipment of all types of wallpaper showing a significant increase, despite a small increase in PVC resin wallpaper

(up 3.9%), in which mass-produced wallpaper comprises the majority. Plastic wallpaper in particular showed a

significant increase (up 40.1%) continuously from the previous year. Plastic wallpaper showed a significant increase

continuously over a three year period.

In terms of monetary amount, all wallpapers showed an increase; paper-based wallpaper to 1.92 billion yen (up

3.8%), fiber-based wallpaper to 1.89 billion yen (up 1.6%), PVC resin wallpaper to 96.04 billion yen (up 5.0%),

plastic wallpaper to 11.63 billion yen (up 31.9%), inorganic wallpaper to 1.37 billion yen (up 5.4%) and other

wallpaper to 1.49 billion yen (up 9.6%). Although small in terms of monetary amount, imports showed a continued

4-year two-digit increase to 1.23 billion yen (up 11.8%).

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[Reference Material] Shifts in the Size of the Interior Fabrics Market(Unit: 100 million yen)

Window treatments Floor coverings Wall coverings Total

Fiscal 2007 2345.2 (90.7) 3049.0 (91.0) 1059.9 (95.6) 6454.1 (96.8)

Fiscal 2008 2127.1 (90.7) 2774.0 (91.0) 1019.9 (96.2) 5921.0 (91.7)

Fiscal 2009 1897.8 (89.2) 2306.5 (83.1) 957.9 (94.0) 5162.2 (87.2)

Fiscal 2010 1904.1 (100.3) 2383.7 (103.3) 981.5 (102.5) 5269.3 (102.1)

Fiscal 2011 1923.1 (101.0) 2368.9 (99.4) 1033.3 (105.3) 5325.3 (101.1)

Fiscal 2012 1966.1 (102.2) 2410.2 (101.7) 1066.5 (103.2) 5442.8 (102.2)

Fiscal 2013 2066.4 (105.1) 2492.1 (103.4) 1143.4 (107.2) 5701.9 (104.8)

[Reference Material] Trends in the Number of New Housing Starts (By Use)(In units; figures in parentheses are percentages compared with the previous year’s figures)

Total Lived in by owner Rental Employee

housing Condominium

Fiscal 2009 775,277 (74.6) 286,993 (92.4) 311,463 (70.0) 13,231 (119.3) 163,590 (60.0)

Fiscal 2010 819,020 (105.6) 308,517 (107.5) 291,840 (93.7) 6,580 (49.7) 212,083 (129.6)

Fiscal 2011 841,246 (102.7) 304,822 (98.8) 289,762 (99.3) 7,576 (115.1) 239,086 (112.7)

Fiscal 2012 893,002 (106.2) 316,532 (103.8) 320,891 (110.7) 5,919 (78.1) 249,660 (104.4)

Fiscal 2013 987,254 (110.6) 352,841 (111.5) 369,993 (115.3) 5,272 (89.1) 259,148 (103.8)Source: “Integrated Statistics on Construction Work” Ministry of Land, Infrastructure, Transport and Tourism

[Reference Material] Trends in Start Floor Area of New Homes (By Use)(Unit: 1,000m2, figures in parentheses are percentages compared with the previous year’s figures)

Total Lived in by owner Rental Employee housing Condominium

Fiscal 2009 67,755 (78.5) 36,498 (90.3) 14,955 (73.9) 712 (97.7) 15,591 (62.5)

Fiscal 2010 73,876 (109.0) 38,852 (106.4) 14,716 (98.4) 457 (64.2) 19,851 (127.3)

Fiscal 2011 75,748 (102.5) 38,242 (98.4) 14,726 (100.1) 530 (115.8) 22,251 (112.1)

Fiscal 2012 79,413 (104.8) 39,539 (103.4) 16,390 (111.3) 418 (78.9) 23,067 (103.7)

Fiscal 2013 87,313 (109.9) 44,098 (111.5) 18,886 (115.2) 424 (101.4) 23,904 (103.6)

Source: “Integrated Statistics on Construction Work” Ministry of Land, Infrastructure, Transport and Tourism

[Reference Material] Trends in Start Floor Area for Each Use(Unit: 1,000m2, figures in parentheses are percentages compared with the previous year’s figures)Total Residential Non-residential

Fiscal 2009 113,196 (74.8) 71,817 (78.2) 41,380 (69.5)

Fiscal 2010 122,283 (108.0) 77,794 (108.3) 44,489 (107.5)

Fiscal 2011 127,292 (104.1) 79,770 (102.5) 47,522 (106.8)

Fiscal 2012 135,454 (106.4) 83,423 (104.6) 52,031 (109.5)

Fiscal 2013 148,456 (109.6) 92,198 (110.5) 56,258 (108.1)

5

Source: “Integrated Statistics on Construction Work”

Ministry of Land, Infrastructure, Transport and Tourism

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[Reference Material] Trends in Start Floor Area for Each Use of Non-Residential Buildings(Unit: 1,000m2, figures in parentheses are percentages compared with the previous year’s figures)

Office Store Factory Warehouse School Hospital Others

Fiscal 2009 7,061 (82.3) 5,526 (66.8) 5,531 (43.7) 4,132 (53.8) 4,278 (107.6) 2,291 (99.1) 12,559 (78.2)

Fiscal 2010 5,548 (78.6) 5,743 (104.0) 6,544 (118.3) 4,382 (106.1) 4,401 (102.9) 3,513 (153.3) 14,357 (114.3)

Fiscal 2011 5,831 (105.1) 5,197 (90.5) 7,315 (111.8) 5,511 (125.8) 4,414 (100.3) 4,575 (130.2) 14,679 (102.2)

Fiscal 2012 6,123 (105.0) 7,433 (143.0) 8,476 (115.9) 6,478 (117.5) 4,582 (103.8) 3,725 (81.4) 15,214 (103.6)

Fiscal 2013 6,094 (99.5) 8,350 (112.3) 8,037 (94.8) 7,028 (108.5) 4,800 (104.8) 4,153 (111.5) 17,793 (117.0)

Source: “Integrated Statistics on Construction Work” Ministry of Land, Infrastructure, Transport and Tourism

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8

Trends in the Number of New Housing Starts (By Use)(unit)

Total

Employee housing

Lived in by ownerCondominium

Rental

Window Treatments

[Curtains]

The number of new housing starts in 2013 was 987,000, up10.6% from the previous year, a consecutive 4-year

increase. Because in 2013 the government decided to raise the consumption tax rate in April 2014, both new housing

starts and the renovation market were stimulated; many public and commercial facilities (i.e., shops, etc.) were

renovated. Last-minute demand for curtains also increased rapidly. In the usually busy quarter starting in December,

particularly in March, many major manufacturers had problems such as long-term stockouts, exceeding production

capacity, specialist labor shortages, delayed deliveries, etc. The market size for curtains in fiscal 2013, supported by

the strong market, grew to 117.4 billion yen (up 6.0% from the previous year). Among them, imports significantly

expanded to 25.8 billion yen (up 15.7% from the previous year) because more low-priced products were imported

and the significantly lower yen resulting from economic and finance policy (“Abenomics”) was reflected in some

high-end imports.

According to a survey of 17 dyeing and finishing factories (processing almost all curtains manufactured in Japan) by

the Nihon Curtain Association to calculate curtain production by curtain type, yarn-dyed products (unfit for mass

production) decreased more than expected. According to data from the Japan Chemical Fibers Association, the

production volume for yarn-dyed products in 1990 was 98 million m2, which was about 4-times the production

volume of piece-dyed products and accounted for about 55% of the total production volume. Circumstance are now

reversed; the ratio of yarn-dyed products has decreased to 8%. Note that the Japan Chemical Fibers Association does

not publish statistical data.

The survey results of the Nihon Curtain Association also shows a significant expansion in sheer curtain (knitted lace

+ voile) production. Heat-shield lace—a core of energy conservation products for whom demand jumped after

subsidization was introduced following the Great East Japan Earthquake—currently lost some momentum, but

recently it seems that heat-shield curtains (mirror lace) have remained in constant demand, as a seasonal product that

has functionalities comparable to heat retention and shading properties.

In the SPA sector (Specialty store retailer of Private label Apparel) which has activities ranging from planning to

production and sales, in addition to importing low-priced products from China, there are also more instances in

which SPAs have been importing gray fabrics from China or Southeast Asia, then printing and sewing the fabrics

(therefore making them “domestically” produced) and finally selling them as ordered curtains. In response to this

trend, Japanese manufacturers are trying to differentiate their products by developing their own fashionable lines,

importing fashionable fabrics from European countries including Italy, Germany, Turkey, and Belgium, marketing

value-added fabrics (flameproof, etc.), and trying to expand sales channels for mid- and high-quality products to

other manufacturers, interior-material distributors, interior coordinators, contractors, etc.

As Japan’s baby boomers continue to age, it is expected that in the Greater Tokyo area, the market for construction

and renovation of medical and welfare facilities will expand and, in response to that expectation brand manufacturers

are actively promoting institutional curtains for government buildings, public facilities, hospitals, schools, etc.

As described above, the market routes for domestic curtains can be divided into the following three types:

- SPA route: Multi-store operations targeting family housing and emphasizing low price.

- Industry route: Large-scale furniture stores/interior shops/contractors, focusing mainly on mid- and high-quality

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products with originality and quality.

- Institutional/subcontracting route: Government offices, public facilities, hospitals, schools, and medical/health-

care/welfare facilities.

While it is expected that the market continues to be at a low ebb for a while because of the 2014 consumption tax

hike, some movement in higher end products have been seen in department stores and other stores that offer pre-

order sales. Sales items and low-priced products are not attracting customers, but high-end products free from price

collapses and functionally differentiated products are attracting attention. Many manufacturers have raised their

prices with the consumption tax hike due to soared raw material costs, and currently it is inevitable for the price of

new domestic curtains to be increased. Predictions are that the higher price of curtains will see customers demanding

more functions, better materials, and higher quality.

(Statistical materials used for establishing market size)

1) “Report on the Shipment and Import of Interior Fabrics, etc. (2014).”

2) Nihon Curtain Association: Curtain production volume by curtain category.

3) The Japan Textiles Importers Association, “2013 Japan Textile Imports Statistics Year Book.”

4) Ministry of Land, Infrastructure, Transport and Tourism, “Integrated Statistics on Construction Work.”

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Table 1. Size of the Curtain Market (wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with previous year’s figures)

Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Total size 1,106 (101.3) 1,094 (98.9) 1,108 (101.3) 1,174 (106.0)

Domestic products 884 (100.8) 879 (99.4) 885 (100.7) 916 (103.5)Imported products 222 (102.8) 215 (96.8) 223 (103.7) 258 (115.7)

Table 2. Size of the Domestic Curtains Market (by type and category, wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with previous year’s figures)

Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Total 884 (100.8) 879 (99.4) 885 (100.7) 916 (103.5)

Ready-made products 80 (105.3) 77 (96.3) 78 (101.3) 71 (91.0)Order-made products 804 (100.4) 802 (99.8) 807 (100.6) 845 (104.7)

Yarn-dyed products 225 (100.0) 215 (95.6) 224 (104.2) 147 (65.6)Ready-made products 17 (130.8) 13 (76.5) 13 (100.0) 8 (61.5)Order-made products 208 (98.1) 202 (97.1) 211 (104.5) 139 (65.9)

Piece-dyed products 414 (97.6) 413 (99.8) 408 (98.8) 377 (92.4)Ready-made products 39 (100.0) 39 (100.0) 40 (102.6) 38 (95.0)Order-made products 375 (97.4) 374 (99.7) 368 (98.4) 339 (92.1)

Sheer curtains 245 (107.5) 251 (102.4) 253 (100.8) 392 (154.9)Ready-made products 24 (100.0) 25 (104.2) 25 (100.0) 31 (124.0)Order-made products 221 (108.3) 226 (102.3) 228 (100.9) 361 (158.3)

* Sheer curtains: Knitted lace + voile (Solid color prints, opal prints, embroidery, etc.)

[Reference Material] Curtain Production Volume by Product Category(Unit: 1,000m2; figures in parentheses are percentages compared with previous year’s figures)

Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Total 98,581 (98.5) 98,059 (99.5) 98,700 (100.7) 108,115

Yarn-dyed products 18,053 (98.0) 17,852 (98.9) 17,900 (100.3) 9,123Piece-dyed products 42,508 (92.3) 41,427 (97.5) 42,000 (101.4) 45,773Sheer curtains 38,020 (106.9) 38,780 (102.0) 38,800 (100.1) 53,219

* Source: Nihon Curtain Association Survey from 2013

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[Blinds]

The market size for blinds during fiscal 2013 was 28.34 billion yen (up 1.7% from the previous year), due to the

increases in both the number of new housing starts and in the construction start floor area for non-residential

buildings.

As happened in the previous fiscal year, electric venetian blinds decreased compared to the previous year, but the

unit price of high-functional manual blinds for houses and offices increased. As a result, the market size for venetian

blinds as a whole expanded to 21.68 billion yen (up 1.2% from the previous year).

The market size for vertical blinds was 6.66 billion yen (up 3.4% from the previous year), because it expanded

significantly in the home use market due to the increase of the number of new housing starts.

<Statistical materials used to determine market sizes>1) “Report on the Shipment and Import of Interior Fabrics, etc. (2014).” 2) Nippon Blind Industry Association, “2013 Statistics on Blinds.” 3) Ministry of Land, Infrastructure, Transport and Tourism, “Integrated Statistics on Construction Work.”

Table 3. Market Size of Blinds (wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with the previous year’s figures)

Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Blinds total 255.3 (96.7) 278.6 (109.1) 278.6 (100.0) 283.4 (101.7)

Venetian blinds 197.4 (96.5) 219.7 (111.3) 214.2 (97.5) 216.8 (101.2)Vertical blinds 57.9 (97.3) 58.9 (101.7) 64.4 (109.3) 66.6 (103.4)

[Screens]

As with blinds, the market for screens during fiscal 2013 was 36.04 billion yen (up 5.8% from the previous year) due

to an increase in the number of new housing starts and the construction start floor area for non-residential buildings.

For products by category, the results for screens, for which the house-use ratio is high, greatly exceeded those of the

previous year due to increased last-minute demand before the consumption tax hike and the increased unit price of

high-priced fabric with a thermal-shield function for energy conservation.

<Statistical materials used to determine market sizes>1) “Report on the Shipment and Import of Interior Fabrics, etc. (2014).”2) Nippon Blind Industry Association, “2013 Statistics on Blinds.” 3) Ministry of Land, Infrastructure, “Integrated Statistics on Construction Work.”

Table 4. Market Size of Screens and Shades (wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with the previous year’s figures)

Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Total 315.4 (101.4) 316.0 (100.2) 340.6 (107.8) 360.4 (105.8)

Roll screens 195.8 (97.6) 193.1 (98.6) 218.8 (113.3) 234.1 (107.0)Roman screens 67.8 (111.9) 68.1 (100.4) 65.2 (95.7) 66.0 (101.2)Pleated screens 51.8 (104.0) 54.8 (105.8) 57.8 (105.5) 60.3 (104.3)

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[Curtain Rails]

The market size for curtain rails in fiscal 2013 was calculated at 21.85 billion yen for curtain rails themselves (a

year-on-year increase of 4.1%), 2.14 billion yen for curtain rail related parts (up 4.9%), and 870 million yen for

others (up 1.2%).

Regarding the demand for curtain rails in the same fiscal year, in addition to the underlying support from the

reconstruction demands following the Great East Japan Earthquake, support was also acquired from last-minute

demand before the consumption tax hike and housing-related policy measures such as lower taxes; against the

backdrop of an increase in new housing starts, this led to a performance level exceeding that of the previous year.

Looking at individual models, functional rails have felt the effect of the increase in new housing starts and have

increased over the previous year; decorative rails, which had been in a continuous decline in recent years, also

surpassed the previous year’s level, even in the midst of the influence of imported products and the shift to functional

rails. For related parts, the spread of a wide variety of accessory items used with and around curtains has led to a

continuous trend of exceeding the previous year. Other categories showed a temporary increase because of changes

to their classifications in 2011 but showed a slight increase because there had not been a change in its classifications

since 2012.

Although shifts in the curtain rail market size are closely related to shifts in the number of new housing starts, other

factors, including trends in the curtain market as well as in the blind and screen markets, are also connected. Even

though curtains with high thermal barrier properties are being well received due to energy conservation demands,

there were changes in window shapes and sizes, and a tendency observed in recent years towards a change in

consumer preferences from curtains to other window treatments (blinds, screens) is also believed to affect shifts in

the curtain rail market.

Regarding future market trends, it will be necessary to take into consideration the temporary decrease in the number

of new housing starts due to the consumption tax hike, a decrease as a reaction to the rush demand before the tax

hike, and increased imports that have an advantage of low price. In order to expand the market configuration for

domestic products, market proposals reflecting improvements in detailed services such as functionality and design

(appeal of added value) that can meet the needs of the market are required.

<Statistical materials used to determine market sizes>1) “Report on the Shipment and Import of Interior Fabrics, etc. (2014).”2) Japan Curtain Rail Industry Association, “Materials for Determining Market Size for Fiscal 2013.”3) Ministry of Land, Infrastructure, Transport and Tourism, “Integrated Statistics on Construction Work.”

Table 5. Market Size of Curtain Rails (wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with the previous year’s figures)

Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013

Curtain rails total 227.4 (98.6) 234.5 (103.1) 238.9 (101.9) 248.6 (104.1)

Curtain rails 197.9 (97.5) 196.3 (99.2) 209.9 (106.9) 218.5 (104.1)

Functional rails 157.3 (98.1) 155.9 (99.1) 169.9 (109.0) 177.1 (104.2)

Decorative rails 40.6 (95.2) 40.4 (99.5) 40.0 (99.0) 41.4 (103.5)

Related parts 19.8 (107.9) 20.2 (102.0) 20.4 (101.0) 21.4 (104.9)

Others 9.8 (103.6) 18.0 (183.7) 8.6 (47.8) 8.7 (101.2)

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Floor Covering Products

[Carpeting]

The size of the market for carpets in fiscal 2013 was calculated as 192.2 billion yen (up 3.3% from the previous

year). The breakdown was calculated with domestic products at 85.0 billion yen (down 2.3%), and imported products

at 107.2 billion yen (up 8.2%), with an overall increase of approximately 6.1 billion yen from the 186.1 billion yen

of the previous year.

The number of new housing starts this year has significantly increased to more than 987,000 houses (up 10.6% from

the previous year). Significant growth was achieved, with the construction start floor area by use increasing overall

by 9.6%, for residential use by 10.5%, and for non-residential use by 8.1%. In the non-residential category, offices

and factories that showed growth up to the last year showed a slight decrease, but stores, schools and hospitals

showed an increase. In the background, “Abenomics” brought economic expansion by ending deflation, and last-

minute demand before the April 2014 consumption tax hike impacted the market, resulting in renovations as well as

new constructions being greatly expanded. In the automobile market, the tax cut program for the environmentally

friendly eco-cars with its good fuel efficiency continuously pushed up sales volume.

Tile carpets, which have the highest production volume among domestic tufted carpets, are used in many places as

the standard floor covering for offices and public facilities. This year, production was calculated to be 27.2 billion

yen (down 5.2% from the previous year). As for roll carpets, which shifted to “up” last year, the volume

continuously increased this year; artificial lawn showed a continued increase from the previous year for four

consecutive years. Piece carpets for home use, however, decreased somewhat from the previous year and particularly

low-priced products decreased because of more imports. Tufted carpets for construction-related areas decreased as a

whole, though this has been slight. Hooked rugs remained mostly unchanged and the production volume for

domestic woven carpets increased slightly. The construction segment is growing steadily but it is frustrating because

the domestic carpet segment is not similarly growing.

The imported carpet segment, mainly from production nations in Asia, has steadily grown in terms of volume and

monetary amount for the last several years; this year the volume decreased slightly yet the money amount continued

to increase due to exchange difference caused by the sudden weakening yen in the last half of 2012, resulting in

higher valued settlement currency against a weakened yen. Another reason is that China and other Asian nations are

demonstrating steady economic growth. Hand woven carpet in particular is a good example; the cost increased 5% to

10% depending on the country mainly because of higher labor costs. Inflation in the nations producing those carpets

also contributes to higher prices. Because of these sharp price increases, the volume of imports as a whole has

slightly decreased, and imports from China are shifting to those from Middle Eastern countries and Southeast Asian

countries.

Exports from Japan, however, still remain small. As for the amount of imports, China has a large share, and Iran,

India and Thailand are strong in hand woven carpets. In the automobile segment, Vietnam is leading, followed by

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Belgium.

As for automobiles, passenger cars that use carpets are standard-sized and compact 4-wheeled vehicles and light 4-

wheeled vehicles. Because of the eco-car tax breaks over the last several years and the last-minute demand before the

start of the consumption tax increase, the number of standard-sized cars slightly increased from the previous year;

light 4-wheeled vehicles decreased, and compact 4-wheeled vehicles greatly increased as their models also

increased. There are two types of carpets for automobiles, which are floor type carpets (installed on the floor of the

car) and option mats (installed under the feet), and by manufacturing method, they are either tufted carpets or needle

punch carpets. Eco-cars have been very popular because of their good fuel efficiency and tax breaks but they must

also be lightweight to improve fuel efficiency. As a result, lightweight needle punch types have grown greatly as

larger numbers of eco-cars have been sold. Tufted carpets have been gradually decreasing for the last several years,

but imported carpets for automobiles have been consecutively increasing over the last two years.

Regarding tufted carpets whose production volume is high, by type of fiber, the filament yarn used in tile carpets,

automobile carpets and roll carpets accounts for almost half of all the tufted carpet (down more than 5% from the

previous year). Polypropylene filament, which is used about 60% of the volume of nylon, has the performance

comparable to nylon and also lightweight and low priced, but it has similarly decreased more than 5%. Polyester

maintained only a slight decrease, but acrylic has shown a continuous decrease for several years and greatly

decreased this year as well. Wool, however, even though small in volume, increased more than 5%.

<Materials used for formulating market sizes>

1) For average unit prices: “Report on the Shipment and Import of Interior Fabrics, etc. (2014).”

2) For domestic products: Japan Carpet Manufactures Association, “JCM News.”

3) For imported products: Ministry of Finance Japan, “Trade Statistics.”

4) Japan Automobile Manufacturers Association, Inc., “Statistics on production.”

5) All Nippon Nonwovens Association, Statistics on production, and other sources.


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Table 6. Market Size of Carpets (wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with the previous year’s figures)

Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Total 1,850 (105.1) 1,832 (99.0) 1,861 (101.6) 1,922 (103.3)

Domestic Products 893 (99.1) 879 (98.4) 870 (99.0) 850 (97.7)Imported Products 957 (111.3) 953 (99.6) 991 (104.0) 1,072 (108.2)

Table 7. Market Size of Domestic Carpets (by product category, wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with the previous year's figures)

Category Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Total 893 (99.1) 879 (98.4) 870 (99.0) 850 (97.7)

Tufted 457 (95.4) 437 (95.6) 413 (94.5) 406 (98.3)Regular use 394 (91.8) 383 (97.2) 360 (94.0) 358 (99.4)Automotive use 63 (126.0) 54 (85.7) 53 (98.1) 48 (90.6)

Tufted tile 267 (98.9) 266 (99.6) 287 (107.9) 272 (94.8)Woven carpet 33 (103.1) 32 (97.0) 34 (106.3) 35 (102.9)Plain weave 7 (140.0) 8 (114.3) 5 (62.5) 4 (80.0)Hooked rug 34 (94.4) 36 (105.9) 33 (91.7) 33 (100.0)Needle punch 88 (118.9) 92 (104.5) 93 (101.1) 94 (101.1)

Regular use 19 (105.6) 18 (94.7) 16 (88.9) 14 (87.5)Automotive use 69 (123.2) 74 (107.2) 77 (104.1) 80 (103.9)

Others 7 (140.0) 8 (114.3) 5 (62.5) 6 (120.0)

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[Plastic Floor Covering Materials]

In fiscal 2013, the market size for vinyl flooring, which is included in plastic flooring materials, was calculated at

57.01 billion yen (up 3.8% from the previous year). With the economy heading for a recovery and last-minute

demand before the consumption tax hike, the market size for vinyl flooring marks a consecutive 3-year increase.

The number of new-housing starts is reaching almost one million (up 10.6%). The construction start floor area for

non-residential buildings was up 8.1% from the previous year. Of these, shops and hospitals showed two-digit

growth from the previous year. Offices and factories showed a slight decrease from the previous year, but it is

expected that any future market recovery may change the direction towards growth from the previous year.

Plastic flooring materials include vinyl flooring, linoleum, rubber flooring and olefin flooring. Of these, vinyl

flooring materials have the largest share of the market. The market size of vinyl flooring has been broken down into

separate categories for calculation: composition tiles, other composition tiles, homogeneous tiles, regular vinyl

flooring sheets, anti-slip vinyl flooring sheets, cushioned flooring, inlaid PVC sheets and other PVC sheets.

“Composition tiles” are one of the standard flooring materials used in non-residential buildings such as offices and

schools. The market has been shrinking in recent years by close to 10%, but this year the range of reduction is

narrowing down because there was more demand from the school segment; the market size was 1.28 billion yen

(down 6.6%). “Other composition tiles” include both those with enhanced design and texture for use in retail and

commercial facilities and those with anti-static properties and ease of maintenance. The market size, reflecting the

demand increase from the retail segment, was 2.28 billion yen (up 4.1%). “Homogeneous tiles” offer a rich sense of

high quality and design and are often used in commercial facilities. They include a variety of products, such as

mainstream laminated tiles where a printed layer is laminated to produce patterns, inlaid tiles with patterns, and floor

tiles that can be easily installed on free access floors. Tiles for office use remained at the same level but as a

reflection of the increase in demand from the retail segment, the market size was 8.59 billion yen (up 11.3%).

“Regular vinyl floor sheets” are available in a wide variety of colors, are highly durable, easy to install, and low cost.

They are used widely as a flooring material in government facilities, schools, hospitals, welfare institutions and

factories. The market size had been decreasing every year for the last few years but as a reflection of the increase in

demand from the school segment, the market size was 7.69 billion yen (up 1.5%). “Anti-slip vinyl flooring sheets”

are often used in areas such as common corridors, verandas and stairs of condominiums where “anti-slip” properties

are required. They are being increasingly adopted in renovations, as well as for new housing projects. The market

size was 9.73 billion yen (up 7.4%). “Cushioned flooring” is mainly used in residential kitchens and bathrooms, and

small commercial facilities. As a reflection of the increase in the number of new-housing starts, the market size was

15.83 billion yen (up 6.0%). “Inlaid PVC sheets” are mainly used in large buildings such as medical, educational and

commercial facilities; they are rated highly for their durability and design, but account for only a small portion of the

market for vinyl floor sheets. The market size was 0.48 billion yen (down 22.6%). “Other PVC sheets” are mainly

foamed multiple-layer vinyl flooring sheets and vinyl flooring sheets with special functionality such as anti-static,

antibacterial, chemical resistant or dynamic load-bearing properties. They are used at a wide range of sites, including

factories, medical and welfare facilities and research laboratories. The market size was 11.12 billion yen (down

3.0%).

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In the market, interest in and needs for energy conservation continue to grow, with an increase in products

conforming to the Act on Promoting Green Purchasing and EcoMark-certified products. The recycling system for

vinyl flooring materials has been operated by the Interior Floor Industrial Association member companies for the

past ten years, and PR activities are being conducted so that a stable amount of installation scrap materials can be

gathered and recycled. There is a growing demand for products to be certified by new international certifications,

such as Floor Score or LEED, and companies are required to respond to the new environmental assessment

framework.

Floor Score®

A certification system for environmental room air characteristics developed jointly by RFCI (Resilient Floor

Covering Institute) in the United States and SCS (Scientific Certification System, third-party certifier).

LEED (Leadership in Energy and Environmental Design)

An environmental performance evaluation system for buildings developed and operated by USGBC (U.S. Green

building Council, non-profit organization).

<Statistical materials used to determine market sizes>1) “Report on the Shipment and Import of Interior Fabrics, etc. (2014).”

2) Shipment volume: Statistical volume from the Interior Floor Industrial Association.


Table 8. Market Size of Plastic Floor Covering Materials (wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with the previous year’s figures)

Category Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Total 533.7 (97.9) 536.9 (100.6) 549.2 (102.3) 570.1 (103.8)

Tiles

Composition tiles 16.5 (91.7) 15.1 (91.6) 13.7 (90.7) 12.8 (93.4)Other composition tiles

22.7 (94.4) 21.8 (96.0) 21.9 (100.5) 22.8 (104.1)

Homogeneous tiles 73.1 (97.4) 75.7 (103.6) 77.2 (102.0) 85.9 (111.3)

SheetsRegular vinyl flooring sheets 78.7 (97.3) 73.4 (93.3) 75.8 (103.3) 76.9 (101.5)

Anti-slip vinyl flooring sheets 84.8 (95.3) 84.4 (99.5) 90.6 (107.3) 97.3 (107.4)

Cushioned flooring 158.7 (95.6) 159.3 (100.4) 149.3 (93.7) 158.3 (106.0)

Inlaid sheets 5.1 (73.2) 4.9 (96.1) 6.2 (126.5) 4.8 (77.4)Other PVC sheets 97.3 (114.5) 101.7 (104.5) 114.6 (112.7) 111.2 (97.0)

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Wall Covering Products

[Wallpapers]

The market size for wallpaper in fiscal 2013 was calculated at 114.34 billion yen (up 7.2% from the previous year).

By product category, sales were 1.92 billion yen (up 3.8%) for “paper-based wallpaper,” 1.89 billion yen (up 1.6%)

for “fiber-based wallpaper,” 96.04 billion yen (up 5.0%) for “PVC resin wallpaper,” 11.63 billion yen (up 31.9%) for

“plastic wallpaper,” 1.37 billion yen (up 5.4%) for “inorganic wallpaper,” and 1.49 billion yen (up 9.6%) for “other

wallpaper.” Sales of imported wallpaper were 1.23 billion yen (up 11.8%) (it is difficult to classify imported

wallpaper, so the sales figure is included in “other wallpaper”).

During the current fiscal year the Japanese economy has shown signs of improvement in business confidence,

employment and income environment backed up by a weakening yen and higher stock prices as the result of the

financial policies and economic measures of Abenomics; the economic climate has slowly shifted to a better

condition.

In the housing market, the number of new-housing starts was 987,000 (up 10.6% from the previous year), making

this the fourth consecutive year of improvement; this is mainly due to the “consumption mind” having recovered

when business confidence improved, an anticipation of higher interest rates and considerable last-minute demand

before the consumption tax hike (April 1, 2014). The total floor area of construction starts increased to 148,460,000

m2 (up 9.6%), with the market size of wallpaper also continuing its increase from the previous year.

The total shipped volume of domestic wallpaper was 725.09 million m2 (up 7.0%), showing a great increase

exceeding the 700 million m2 level for the first time in the last six years; the volume returned to the same levels as

before the Lehman collapse. Viewing the shipped volumes by category, all categories exceeded the previous year’s

level, PVC resin wallpaper, despite the lowest growth rate, showed a great expansion in quantity (up 3.9%). Plastic

wallpaper showed by far a great increase over three consecutive years (up 40.1%). Paper-based wallpaper (up

14.1%), fiber-based wallpaper (up 10.5%) and inorganic wallpaper (up 10.2%) all showed two digit growth. The

shipped volume of imported wallpaper increased to 1.63 million m2 (up 16.4%); this growth suggests the

globalization and diversification of wallpaper.

In recent years, increasing numbers of consumers are enjoying selecting their own wallpaper and have more interest

in wall decoration. But most wallpapers are still mass produced and in basic plain colors as construction materials.

As for the wallpaper share in Japan, PVC resin wallpaper and plastic wallpaper combined constitute 98.1%.

Globally, fleece wallpaper (non-woven wallpaper) constitutes about 50% of the share and there is growing

momentum to promote fleece wallpaper as a material that can support the future of Japan’s wallpaper industry;

development and marketing efforts have begun in cooperation with the manufacturing, distribution, and contractor

sectors.

Going forward, there are concerns about the demand decrease caused by backlash from the consumption tax hike and

higher prices because of soaring material costs. Contractors have been supplying wallpaper for walls and ceilings for

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all sorts of buildings over many years, but what they have to do now is be more innovative in producing value-added

wallpaper and boost demand for replacements. We believe that appealing the attractiveness and joy of wallpaper will

lead to further prosperity for the wallpaper industry.

<Statistical materials used to determine market sizes>1) “Report on the Shipment and Import of Interior Fabrics, etc. (2014).”

2) Uses “Production/shipment quantity” data for wallpaper, taken from the Japan Wallcovering Association

statistics. The Japan Wallcovering Association was reorganized on March 1, 2002, and is operated based on the

three categories of manufacturing, distribution and installation, to provide quality information management

systems for wall covering materials to prevent fire.

The Association consists of members from 63 member companies and 123 associate member companies. Its

statistics on production/shipment quantity for wallpaper is a compilation of performance reports from member

manufacturing companies on their monthly production and shipment. We used the data as a reference because of

its reliability.

3) In calculating the scale of imported products, calculations from 2002 use the Japan Wallcovering Association’s

statistics on production/shipment quantity for wallpaper, as with domestic wallpaper.


* Figures for the total quantity of wallpaper in each table are rounded off, and therefore may not necessarily match

the figures for total quantity in each category.

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Table 9 Market Size of Wallpaper (domestic products, imported products, wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with the previous year’s figures)

Fiscal 2010 Fiscal 2011 Fiscal 2012 Fiscal 2013Total 981.5 (102.5) 1,033.3 (105.3) 1,066.5 (103.2) 1,143.4 (107.2)

Domestic products 974.8 (102.4) 1,025.2 (105.2) 1,055.5 (103.0) 1,131.1 (107.2)Imported products 6.7 (111.7) 8.1 (120.9) 11.0 (135.8) 12.3 (111.8)

Table 10. Market Size of Wallpaper (by product category, wholesale basis)(Unit: 100 million yen; figures in parentheses are percentages compared with the previous year’s figures)


Total 981.5 (102.5) 1,033.3 (105.3) 1,066.5 (103.2) 1,143.4 (107.2)

Paper-based wallpaper 17.2 (90.1) 18.0 (104.7) 18.5 (102.8) 19.2 (103.8)

Fiber-based wallpaper 18.5 (112.8) 17.5 (94.6) 18.6 (106.3) 18.9 (101.6)

Polyvinyl chloride resin wallpaper 873.6 (103.6) 904.6 (103.5) 914.7 (101.1) 960.4 (105.0)

Plastic wallpaper 47.3 (85.2) 67.9 (143.6) 88.2 (129.9) 116.3 (131.9)

Inorganic wallpaper 16.9 (106.3) 15.3 (90.5) 13.0 (85.0) 13.7 (105.4)

Other wallpaper 8.0 (102.6) 10.0 (125.0) 13.6 (136.0) 14.9 (109.6)

[Reference Material] Wallpaper Production and Shipment (Unit: 1,000m2; figures in parentheses are percentages compared with the previous year’s figures)


Paper-based wallpaper

Production 4,476 (95.3) 4,841 (108.2) 4,619 (95.4) 5,210 (112.8)Shipment 4,500 (95.1) 4,703 (104.5) 4,480 (95.3) 5,110 (114.1)

Fiber-based wallpaper


Polyvinyl chloride resin wallpaper


Plastic wallpaper Production 21,278 (98.8) 40,650 (191.0) 56,126 (138.1) 78,530 (139.9)Shipment 21,122 (95.6) 40,640 (192.4) 56,057 (137.9) 78,552 (140.1)

Inorganic wallpaper Production 7,139 (113.4) 6,036 (84.5) 5,095 (84.4) 5,626 (110.4)Shipment 7,227 (110.5) 6,287 (87.0) 5,100 (81.1) 5,619 (110.2)

Other wallpaper Production 179 (90.9) 220 (122.9) 648 (294.5) 721 (111.3)Shipment 178 (89.9) 230 (129.2) 668 (290.4) 710 (106.3)

Total Production 612,659 (103.9) 675,492 (110.3) 681,779 (100.9) 721,532 (105.8)Shipment 614,496 (104.0) 667,381 (108.6) 677,604 (101.5) 725,088 (107.0)

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· web viewaccording to a survey of 17 dyeing and finishing factories (processing almost all...

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