Current state of the Interior Fabrics product Market

Window treatment products 244.4 billion yen

Floor covering products 256.3 billion yen

Wall covering products 113.7 billion yen

In fiscal 2002, the interior fabrics industry confronted the same difficult environment that it encountered in the previous fiscal year, with falling construction starts and sluggish personal consumption impacted by the economic uncertainty. Accordingly, the overall scale of the interior fabrics market (on a wholesale base) contracted 4.2% from the previous fiscal year. The size of the markets for interior fabrics products (on a wholesale basis) for fiscal 2002 was estimated at 244.4 billion yen (a decrease of 1.0% from the previous year) for window treatments, 256.3 billion yen (down 4.1%) for floor coverings, and 113.73 billion yen (up 10.7%) for wall coverings. The decline of in excess of 4% in the three combined fields is largely attributable to the drastic fall in wallpaper sales, which has run for three consecutive years. The scale of the market for wallpaper contracted 4.7% from the previous year in terms of quantity and 10.6% in terms of value, falling below the level of the previous year (with an 8.8% decrease), obviously suggesting a further decline in average unit prices.

The markets for window treatments were estimated 147 billion yen for curtains, 33.59 billion yen (dropping 1.7% from the previous year) for blinds, 34.78 billion yen (an increase of 3.8% over the previous year) for screens, 29.03 billion yen (declining 8.2%) for curtain rails, giving an overall market of 244.4 billion yen (representing a 1.0% fall from the scale of the previous year).

With respect to curtains, NIF started its own investigation this fiscal year to obtain more accurate estimates of market size, enabling a clearer and more realistic understanding of the size, even if that prohibits comparisons with the previous year. In comparison with the former method of determination, the new approach results in a drastic rise in imports. This is attributable to higher direct imports, which do not go through downstream companies such as wholesalers or manufacturers. On the other hand, sales of domestic products were below the previous year’s results, the sixth consecutive year that this has happened. Sales were believed to have been adversely impacted by the failure to recover from the slump in housing starts and the persistent, albeit easing, slide in average unit prices.

Similarly, sales of blinds continued to decline (with a year-on-year decrease of 1.7%) in fiscal 2002, a result attributable to sluggish growth in construction starts and weaker unit prices, although the percentage drop was lower this year. The wooden blind market has steadily expanded, although there is concern about the growing share of cheaper products.

In contrast to the sustained contraction of demand for curtains and blinds, the overall market for screens registered 3.8% growth, its fourth consecutive year of expansion. This is likely the result of the favorable influence of an increased number of suppliers, as well as shift in demand from curtains and blinds to screens.

The market size of roll screens increased 3.1%, reflecting continued popularity and the full-scale entry of curtain manufacturers into the market, which offset falling prices and accounted for the rise. The market size for Roman shades grew 3.2%, rising for the fourth straight year, while the market for pleated screens increased 11.1%, continuing a run of double-digit gains that started in 1997.

Impacted by falls in construction starts and unit prices, curtain rail sales contracted 8.2%, although this was a smaller reduction than that experienced in the previous year. Sales of curtain-related products were up 7.7%, after a dramatic decline in the previous fiscal year (when sales fell 30.6%).

Although its range is somewhat diverse, across the three key materials of fiber, plastic and wood, as in the past the market size of the floor covering (floor materials) section was calculated in terms of carpets and plastic floorings. These are the two areas in which Nippon Interior Fabrics Association (NIF) members are more closely involved.

The market size for floor coverings during fiscal 2002 was estimated at 218.9 billion yen (a year-on-year decline of 3.9%) for carpets and 37.4 billion yen (down 4.8% from the previous year) for plastic floorings, giving 256.3 billion yen (down 4.1%) overall. The figures reflect a reduction in the floor area of construction starts in both the housing and non-housing markets, although the contraction was less that it was in the previous fiscal year.

Sales of domestic carpets continue to fall. Even for imported carpets, sales were down 0.8% in 2002, after two straight years of growth. The trend toward falling prices also observed in imports is reflected by the fact that in quantity terms, sales of imported products actually rose 8.9%. Still, imported products are gaining a greater share of the market in yen terms.

Sales of domestic products included an 11.8% rise for hooked rugs, a 1.0% increase for tiles, flat growth for both needle-punched carpets and flat-woven carpets, a 3.2% fall for woven carpets, and a 10.3% decline in mainstay tufted carpets. The dramatic fall in sales of tufted carpets contributed to the overall contraction of the carpet market.

Once again this year, the market size was determined for only three types of plastic floorings: composition tiles, regular vinyl sheets and cushioned flooring. In fiscal 2002, there was only a slight reduction in sales of composition tiles, with a 2.4% decline, while sales of regular vinyl sheets dipped 5.4% because of falling construction of public buildings, and cushioned flooring also dropped 5.0%, continuing the year-by-year decrease. Overall, the general decline was 4.8%.

The market size for wallpaper products in fiscal 2002 was estimated at 113.73 billion yen, a 10.6% fall from the previous fiscal year.

This is the first statistical survey of a new section, following a regulatory change in which fireproof wall covering materials are to be qualified for each business. Consequently, figures cannot simply be compared with those for the previous fiscal year for each section. The total quantity of wallpaper shipped within Japan declined for the third consecutive year, and fell below 700,000,000_ for the first time in four years. The figure showed a dramatic double-digit drop, strongly attributable to lower selling prices and declines in average unit prices as the fierce competition in the market continued.

Vinyl wallpaper, the key product, is classified as PVC resin wallpaper. This product is increasingly mass-produced, resulting in a decline in sales in value terms. Sales were down for both paper-made wallpaper and fiber-made wallpaper (combining woven and chemical fiber wallpaper).

Plastic wallpaper was the only category that showed growth. This product is non-PVC resin plastic wallpaper (olefin wallpaper) and includes acryl and EVA wallpaper products, which experienced sales gains of 20% or more compared with the previous year. This should suggest that more products have been accepted by environmentally friendly houses and buildings.

[Reference Material]

Trend in New Housing Starts (By Use)

(Unit: 1,000; figures in parentheses are as percentages of previous yea’s figures)

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

[Reference Material]

Trend of Floor Area of New Homes (By Use)

(Unit: 1,000m², figures in parentheses are percentages of previous year’s figures)

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

[Reference Material]

(Unit: 1,000m², figures in parentheses are percentages of previous year’s figures)

Source: “Integrated Statistics on Construction Work”

Ministry of Land, Infrastructure and Transport

[Reference Material]

Trends in Floor Area for Each Use of Non-Residential Buildings

(Unit: 1,000m², figures in parentheses are as percentages of previous year's figures)

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

[Curtains]

First, to compensate for the dearth of information materials to assist in the calculation of sales of imported and domestic products (by product type), NIF conducted an independent survey to determine the market size for curtains in fiscal 2002, so that the relative market sizes were clear.

The size of the market for imported curtains appeared to be much higher than that obtained using the conventional calculation method. This is largely because of the inability to compensate for the change (minimization) in the estimated market share occupied by NIF members, which resulted from a rapid increase in the weighting of directly imported merchandise at downstream companies in the imported curtain market.

For overall domestic production, we identified past trends, with the overall size reflecting market tendencies. However, the volumes for yarn-dyed and piece-dyed curtains were reversed, in terms of production by product type. That is because external materials on each product type supplied since 1998 are no longer available, resulting in a gap between market reality and estimates based on trend values and materials obtained from NIF members.

In any case, we will clarify the direction of market size estimates by continuing to carry out the survey above.

Therefore, we do not compare values of the two indices stated above with those for the previous fiscal year.

The market size for curtains was determined to be 147 billion yen. Sales of domestic products fell below those for the previous year for the sixth consecutive year (with a year-on-year decrease of 8.7%). The increase in imports is attributable to higher direct imports dealt with by downstream companies including DIY outlets, and which do not go through wholesalers or manufacturers.

Looking at breakdown of domestic products by type, sales of made-to-order curtains failed to keep pace with the previous fiscal year, declining 5.3%, and the size of the market for ready-made curtains contracted significantly (by approximately 30%). The curtain market remains difficult, and this is reflected in the figures above.

The total production of curtains during 2002 was 157,000,000_, showing a year-on-year fall of 3.8%. This clearly indicates a correlation between the growth in production and the development of the market size.

Presumably, this is supported by the fact that the number of housing starts has been in a long-term slump (1,145,000 households/year, a year-on-year drop of 2.4%). The downward tendency continues for such indices as the number of apartments sold and the rate of contraction, and unit prices are still declining, albeit at a slightly slower pace.

<Statistical materials used to determine market sizes>

1) Domestic products

The market size was determined by calculating average units and the ratio of made-to-order curtains to ready-made products, while referring to reports on actual shipment by NIF members, based on the data from the “Curtain Shipment Volume and Value by Product Type.”

2) Imported products

The market size was determined based on a survey of the curtain conducted by NIF.

*The sizes of the markets for both domestic and imported products are calculated based on average unit prices of products from NIF members, which makes it impossible to verify differences compared to actual prices in the markets.

Table 1. Size of the Curtain Market (wholesale basis)

(Unit: 100 million yen; figures in parentheses are percentages of previous year’s figures)

Table 2. Size of the Domestic Curtains (by type and category, wholesale basis)

(Unit: 100 million yen; figures in parentheses are percentages of previous year’s figures)

Curtain Production Volume by Product Category

(Unit: 1,000m²; figures in parentheses are percentages of previous yea’s figures)

The market size for blinds during fiscal 2002 was estimated at 28.08 billion yen (a year-on-year decrease of 0.6%) for Venetian blinds, 5.51 billion yen (declining 6.9%) for vertical binds, and 33.59 billion yen (down 1.7%) in total.

The blind market in 2002 experienced a transition from blinds to fabrics in housing, a slump in housing starts and lower unit prices. Still, the market managed to avoid a dramatic decrease.

Although it has been steadily expanding demand, the size of the wood-made blind market may shrink because of lower unit prices stemming from a growing share of cheaper products and phenomena associated with market contraction.

Statistical data used in determining market size

1. “Report on the Shipment of Interior Fabrics, etc. (2002),” NIF
2. “2002 Statistics on Blinds,” Nippon Blind Industry Association

Table 3. Market Size of Blinds (wholesale basis)

(Unit: 100 million yen; figures in parentheses are percentages of previous year’s figures)

The market for screens was determined to be 23.48 billion yen (a year-on-year increase of 3.1%) for roll screens, 8.4 billion yen (up 3.2% from the previous year) for Roman shades, and 2.9 billion yen (rising 11.1%) for pleated screens. The overall market size was 34.78 billion yen (an increase of 3.8% over the previous year).

Competition is becoming tougher and prices are falling for roll screens, although curtain manufacturers entered the market and there is strong demand. However, the market expanded in scale, thanks to an increasing tendency to move away from curtains.

Roman shades achieved greater prominence in the market and demand is continuing to rise as functions and styles are enhanced, including the introduction of two-piece shades similar to curtains and the acceptance of orders using cloth specified by customers.

Pleated screens acquired a higher profile still as more manufacturers entered the market and an increasing volume of products were introduced.

Overall, the screen market exhibited steady growth despite the deteriorating conditions. The market was favorably affected by the virtuous circle triggered by the shift in demand from curtains and blinds to screens, the provision of products to respond to demand and the rising number of screen product suppliers.

1. “Report on the Shipment of Interior Fabrics, etc. (2002),” NIF
2. “2002 Statistics on Blinds,” Nippon Blind Industry Association

(Unit: 100 million yen; figures in parentheses are percentages of previous year’s figures)

The market size for curtain rails in fiscal 2002 was estimated at 25.39 billion yen (a year-on-year decrease of 10.7%) for curtain rails, 2.38 billion yen (rising 7.9%) for curtain-related products, and 1.26 billion yen (up 24.6%) for others. This gave a total market size of 29.03 billion yen (a year-on-year decline of 8.2%).

The curtain rail market shrank again this fiscal year in terms of overall quantity (on a value basis), badly impacted by the decline in housing starts (to 1,145,000 households/year, down 2.4% from the previous year) and other factors. Still, the rate of market contraction has been diminishing.

Sales of functional rails decreased more than 11%, a reflection of the relatively small number of new houses. Decorative rail sales also dropped 7.5%, influenced by falling unit prices of wooden rails.

The contraction of the curtain rail market is attributable to the decline in demand for curtains and stronger demand for roll screens, Roman shades and pleated screens.

Table 5. Market size of Curtain Rails (wholesale basis)

(Unit: 100 million yen; figures in parentheses are percentages of previous year’s figures)

The market size of carpets for fiscal 2002 was estimated at 218.9 billion yen (down 3.9% from the previous year’s result), consisting of sales of 118.1 billion yen (down 6.5%) for domestic products and 100.8 billion yen (slipping 0.8%) for imported products. The 6.5% decline in sales of domestic products and the relatively stable performance of imports suggests that imports are taking a steadily growing share of the market. The size of the carpet market diminished for the second successive years, partly impacted by the ongoing demand for price cuts from the market, something experienced in the previous year.

Nonetheless, the overall quantity of imported carpets increased nearly 10% (rising 8.9%), while the value decreased slightly, down 0.8% from the previous year. This indicates that the tendency for price cuts is marked for imports as well. The vast majority of imports came from China, with incoming shipments up 38.8% from the previous year in terms of quantity, and rising 15.8% in value terms. These volumes account for over 40% of total imports. In terms of quantity, China was followed by Thailand, Belgium, and India, with these top four countries accounting for more than 70% of total imports. In yen terms, the leading exporters included China, Belgium, the United States and India, which together accounted for just below 70% of imports to Japan. Characteristically, the volume of imported tufted carpets sold experienced a greater rise, up 16.9% from the previous year, while the quantity of imported Wilton and other woven carpets sold decreased slightly.

In the construction market, the number of new housing starts declined for the third consecutive year, to 1,145,000 houses/apartments (down 2.4% from the previous year). The total floor area of construction starts of non-residential buildings was also down from the year before, declining 3.3%, and this impacted the market. Although the quantity of carpet tiles improved strongly (rising 6.4%), aided by the 6.9% growth in commercial buildings, in value terms growth was only slight, reflecting a reduction in market prices. Carpet pieces for household use exhibited favorable growth in quantity terms. Sales of roll carpets and needle-punched carpets continued to fall from the previous year.

The total number of automobiles produced was 10,260,000 (a year-on-year increase of 4.9%), achieving positive growth for the first time in two years. Positive growth, also a first for two years, was also achieved for passenger vehicles, with sales at 8,620,000 units (up 6.2% from the previous year). This led to rise in the overall quantity of carpets for transport use. In contrast, the value of carpets installed in automobiles decreased. This reflected a dramatic reduction in sales tufted carpets, in favor of more needle-punched carpets, a move taken to reduce costs.

<Materials used for formulating market sizes>

1) For average unit prices: Survey on actual shipments, NIF (2002)

2) For domestic products: “Statistics on Changes in Carpet Production and Imports” and “Statistics on Tile Carpet Production” Japan Carpet Manufactures Association

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

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

5) Statistics on New Housing Starts for 2003 (Summary), etc., Ministry of Land, Infrastructure and Transport

Table 6. Market Size of Carpets (wholesale basis)

(Unit: 100 million yen; figures in parentheses are percentages of previous year’s figures)

Table 7. Market Size of Domestic Carpets (by product category, wholesale basis)

(Unit: 100 million yen; figures in parentheses are as percentages of previous year's figures)

Vinyl flooring materials have the largest share of the market for plastic flooring materials. The market size for fiscal 2002 was estimated for such vinyl flooring materials as composition tiles, regular vinyl sheets and cushioned flooring.

In this survey, composition tiles refer to general-purpose products of a semi-hard type. With its good durability and ease of installation, this is one of the leading flooring materials used as an inexpensive PVC tile in non-residential buildings such as offices and schools. However, the market has recently entered a gradual decline because of the diversification of flooring material products. In fiscal 2002, the market size only contracted slightly from the previous fiscal year, as the products were used as an inexpensive flooring material.

The regular vinyl sheet is called a long PVC sheet. This sheet can be used in a wide range of general-purpose applications without the need to install a foam layer. It is used as a highly durable sheet flooring material in schools, hospitals, welfare institutions and factories. As with the previous fiscal year, the market size in fiscal 2002 contracted on a year-on-year basis because of a decline in public construction and falling investments by private businesses.

Cushioned flooring is flooring with a foam layer, which has a decorative feature enhanced by a printed layer. The product comes in two types, depending on the thickness of the superficial layer (i.e., a transparent PVC layer) and the total thickness, for residential and commercial applications. Residential cushioned flooring is 1.8 to 3.5 mm thick, while commercial cushioned flooring is 2.3 mm thick. The material has been increasingly used in apartments in recent years. The type for domestic use is only used in damp areas such as kitchens, washstands and toilets, and only a small quantity is used in each house or apartment. The market size for cushioned flooring in fiscal 2002 contracted from that of the previous year, continuing a downward trend.

The market size for the three kinds of plastic floor materials in fiscal 2002 was estimated at 37.4 billion yen (a year-on-year decrease of 4.8%).

1. 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 as percentages of previous year's figures)

[Wallpapers]

The market size for wallpaper in fiscal 2002 was calculated at 113.73 billion yen, representing a contraction of 10.6% from the previous year. Among the product categories, regulations for fireproof wall covering materials were amended to change the qualifying system in which each manufacturer is to obtain qualification, while the grades of fireproof performance and the classifications of materials were also modified. Therefore, this survey has been carried out anew, covering new categories without permitting simple year-on-year comparisons by category. By product category, sales appeared to be 4.63 billion yen for paper-made wallpaper, 3.01 billion yen for fiber-made wallpaper, 90.1 billion yen PVC resin wallpaper, 7.76 billion yen for plastic wallpaper, 6.64 billion yen for inorganic wallpaper and 1.59 billion yen for others. The sales of imported wallpaper was determined to be 0.86 billion yen (reference materials have been changed this year onward).

The total volume of shipped domestic wallpaper was 696,830,000_ (a year-on-year decrease of 4.7%), falling below the previous year’s result for the third consecutive years and dipping below 700,000,000_ for the first time in four years.

Accounting for about 80% of the market as the mainstay product, vinyl wallpaper has been classified as “plastic wallpaper (PVC resin wallpaper)” which includes inorganic wallpaper (a product with a backing made using aluminum hydroxide). Its sales decreased 5.6% from the previous year’s figure. This is the result of greater production of mass-produced wallpaper, which influenced the decline on a yen basis. Sales of paper-made wallpaper started to fall in fiscal 2001 and difficulties in installation contributed to a further decrease (with a year-on-year decrease of 27.0%). Fiber-made wallpaper consists of woven and chemical fiber wallpaper now, and its sales remain negative (with a 20.0% decline from the previous year). Plastic wallpaper (others) is the only category which enjoyed growth. This product contains non-PVC resin plastic wallpaper (olefin wallpaper), including acryl and EVA wallpaper, which was part of the classified group for specific wallpaper (such as olefin, painted and damask wallpaper). The growth of sales in this product category is estimated at 20% or more when the year-on-year ratio is roughly calculated. The increase in sales of olefin wallpaper reflects enhanced support from major housing manufacturers and developers for environmentally-friendly houses and buildings.

The shrinkage of the market has continued for three successive years and should be a clear indicator of falling shipments, market price cuts amid fierce competition and falling unit prices. In addition, the number of housing starts declined for the third consecutive term and the total number of households was as low as 1,145,000 for the first time in 19 years, since 1983. The number will fall below 1,000,000 in the near future.

This fiscal year faces the introduction of the individual qualification system for fireproof wall covering materials and the whole industry, including manufacture, sales and construction, is working more closely under the leadership of the Wallcoverings Association of Japan to promote the sound development of the wallpaper industry and maintain reliability of fireproof wall covering materials. Under the revised Building Standard Law, as a response to the sick house syndrome, wallpaper may be used as a product with F☆☆☆☆, without the restrictions on area as before. Therefore, the challenge for the industry is to further enhance the superiority of wallpaper as a construction material and advertise its value as an interior element to stimulate demand.

* There may be some discrepancies in the totals for each item in each wallpaper tables because of rounding.

Table 9. Market Size of Wallpaper (domestic products, imported products, wholesale basis)

(Unit: 100 million yen; figures in parentheses are as percentages of previous year's figures)

Table 10. Market Size of Wallpaper (by product category, wholesale basis)

(Unit: 100 million yen; figures in parentheses are as percentages of previous year's figures)

Wallpaper sold at outlets such as bulk merchandisers operating in the Do-It-Yourself market is not included in “Wallpaper Production and Shipment Volumes,” produced by Wallcoverings Association of Japan and used in determining the size of the market here. Hence, the wallpaper section in the “Volume and Value of Products Sold” by the Household Fusuma and Wallpaper Association has been extracted and included here for reference.

The market size in fiscal 2002 was 2,821,140,000 yen (a year-on-year increase of 34.5%), showing a very significant increase. Unlike wallpaper used in the construction market, medium- and high-grade wallpaper is preferred, as while sales increased 12.9% in terms of quantity while it rose 34.5% in value terms. By product category, sales of adhesive wallpaper grew 45.9% and that of vinyl re-damping wallpaper increased 15.0%. A rise in sales was also noted for non-sticky wallpaper.

[Reference Material]

Wallpaper Production and Shipment

(Unit: 1,000m²; figures in parentheses are as percentages of previous year's figures)

[Reference Material]

Household Fusuma and Wallpaper Association “Volume and value of products sold”

(Unit: 1,000m, 1,000 yen)

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