The flooring industry is facing a challenging environment due to a stagnant housing sector, with surging mortgage rates above 7% and a “lock-in effect” keeping a lid on home sales. This has led to pent-up demand, which distributors hope will eventually burst and stimulate the market.
According to Capital Economics, a macroeconomic research firm, annual home sales could slump to around 4.7 million by the end of 2026—the slowest pace since 2011. This slowdown is expected to last several years, leaving distributors frustrated and seeking ways to make the challenging environment work to their advantage.
Top Distributors Adapt to Changing Market
Many top distributors are posting revenue increases, principally by taking market share and expanding their base. A case in point is Minneapolis-based All Surfaces, which is up double digits over 2025 due to its acquisition of West Virginia-based Abraham Linc. This acquisition significantly expanded the firm’s footprint from the East Coast to the Mountain West territories.
John DeYoung, All Surfaces CEO, called the acquisition “transformative” for the company, praising the operators at Abraham Linc for their relentless focus on customer service. He also noted that the firm has learned a lot from Abraham Linc’s expertise in OEM and private-label products.
In the past year, the company has built a brand-new facility in Nashville, Tenn., and fortified its market presence with several key product line additions, notably Sika/Schönox, “which has been a real boom for our business,” DeYoung said. “We keep investing in technology, in integrations and making our business better. We want our company as well positioned as possible so that when the wind does come to our back, we are ready.”
Challenges Persist in the Market
Despite some positive signs, the market remains challenging due to high mortgage rates, record-high home prices, and a severe shortage of for-sale inventory. Flooring observers point out that it is not only diesel fuel costs but also inbound freight costs on containers and higher surcharges placed by suppliers that are constricting the market.
Aaron Rhoderick, vice president of sales at Tri-West, Ltd., noted that the market is still dealing with a relatively slow economy. High interest rates are negatively impacting existing home sales, new home construction, multifamily new construction, and large commercial projects. Tariff uncertainty and high fuel costs have kept the market off balance and may lead to higher prices.
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North of the border, national Canadian distributor Shnier-Gesco is up 5% year-over-year despite grappling with a high degree of complexity and uncertainty in the market. “Tariffs and counter-tariffs have added cost and made sourcing more complicated, while the general softness in residential continues,” said Greg Vrantsis, director of product development and marketing for the Brampton, Ontario-based distributor. “Add political fatigue, consumer uncertainty and people simply being cautious about spending and there are a lot of factors affecting confidence.”
Focusing on areas they can control, like taking share, has been the mantra for many distributors. Eagan, Minn.-based Herregan is up fractionally over 2025 on the strength of geographic expansion that has helped it gain market share, according to Pat Theis, vice president of sales and marketing.
As distributors seek solutions that work for today, they are finding internal efficiencies and refining their operation as a whole. Enhancing the customer experience is always a priority but it becomes all the more so when opportunities for sales become more challenging.
Amid a tough residential environment, Shnier-Gesco has relied on its commercial work to drive growth.
When growth is stagnant, successful distributors look to grow by taking market share. Jeff Striegel, president of Elias Wilf, noted that in this environment, companies are either taking share or giving it up, with no middle ground.
For now, distributors remain hopeful that pent-up demand will eventually burst, and the market will return to growth. While acknowledging that the industry is up against inflationary pressures and a customer base that largely is sitting this one out, FlorStar Sales president/CEO Scott Rozmus remains unfazed. “The data makes clear that the business is there,” he said. “We just have to work to get it.”
