ORLANDO, FLA. (March 16, 2:10 p.m. ET) — It was yet-another challenging year for window manufacturers in 2011. But that isn't stopping them from attacking the marketplace and trying to take share away from their competitors in the vinyl window market, or from wood and aluminum windows.
“The best time to grow share is when the market is down because you have a lot of companies who try and wait it out” and shy away from product introductions, said Gary Pember of Simonton Building Products Inc. in an interview at the International Builders' Show, held Feb. 8-11 in Orlando.
“We try to be more aggressive with new products,” especially when the market is down, said Pember, vice president of marketing for Simonton Windows. “So we took market share in 2011, even though there was a general overall decline industrywide in the units of windows sold in the United States in 2011, and the mix of product changed from high-end to ‘the opening point' of the product line.”
Columbus, Ohio-based Simonton is planning to gains market share again in 2012 with its new Asure windows, which have a narrower vinyl frame that will bring in more light and expand the outside view.
“The viewing area will increase by 17 percent on a standard 3-foot-by-5-foot frame” when compared with Simonton's Reflection 5300 and Reflection 5050 products, Pember said. “This enhances our opening price-point market and gives us a new product with some distinct advantages.”
The Asure windows, introduced March 5, have a stepped window sill that directs rain and water away from the window. They come in four window types: double-hung, picture, geometric half-round and sliding, as well as a style for patio doors. Window grids, when chosen as an option, are placed between the window panes, eliminating the need to clean them. The first two colors will be white and tan, Pember said.
“The windows also have good thermal performance,” even though the glass area is larger, said Pember, with exact thermal performance dependent on the Energy Star glass package that is chosen.
Exterior home products manufacturer Ply Gem Industries Inc. added the option for a new flat-casing, rigid vinyl frame for its Pro Classic windows and its Replacement Impact vinyl single- and double-hung windows, which are designed to withstand hurricane-force winds.
Based on the same technology found in automotive safety glass, the two panes of Ply Gem impact windows are bonded together by an interlayer of polyvinyl butyral.
Similarly, after successfully making inroads into the replacement market in 2011, acrylic block window manufacturer Hy-Lite introduced at the show an in-swing egress casement window targeted for replacement markets in the Midwest and Northeast. It also showcased DecoGuard, the company's first hurricane-impact-resistant decorative glass window, which has been on the market since August and has a heavy-duty vinyl frame.
“We probably finished a little ahead of where we expected to be” in 2011, said Tom Rachfal, vice president of sales and marketing for Hy-Lite, a U.S. Block Windows Co., based in Pensacola, Fla. “We knew we would do well but we were pleasantly surprised,” especially since the company only began targeting the replacement market in mid-2009.
“But once the homeowners and architects see that the windows open and close and provide privacy without needing a window tint, there is a ‘wow' factor, because the windows also provide a unique look,” particularly for kitchens and bathrooms, Rachfal said. “We targeted a lot of independent remodelers around the country to penetrate the replacement market.”
The addition of the new in-swing egress windows, the DecoGuard line and its recent national distribution agreement with major window replacement dealer Window World will provide a boost for 2012, he believes.
“They are all ways to grow the brand,” Rachfal said. “DecoGuard is the industry's first impact-resistant block window, and the in-swing casement window will help us in the Midwest, where our products aren't as well-known as they are in the Southwest and South. Those customers won't have to look out at a window-well view anymore.”
Rachfal said Hy-Lite hopes to have the rollout of its windows throughout the Window World system completed in the next six months.
In the past, as much as 90-95 percent of Hy-Lite's sales have come from the new-home market. But that's changing rapidly, with the company working to balance sales between the two segments, especially since the dollar value of replacement window sales outstripped new home window sales for the first time in 2011.
“We've always been a new-construction building market company, and new construction will still be a major part of our business,” said Rachfal. “But five years from now, we hope it is a 50-50 split.”
Despite industrywide unit sales declines in five years of the past six years — the exception was 2010 when the federal energy tax credit boosted sales — a number of companies in the industry remain optimistic about 2012.
Filip Geeraert, president and CEO of Deceuninck North America LLC, said he expects to see a 10 percent improvement over 2011 sales. The Monroe, Ohio-based extrusion company makes PVC profiles for windows and doors, as well as for PVC decking and rails.
Pember of Simonton is also optimistic.
“I am much more positive about 2012,” he said. “It is already looking very good. We are seeing an improvement in the mix, with more people again looking at thermal efficiency and higher-priced windows” after 2011 when many consumers focused on the lower-priced unit in window product lines.
“I don't think it will be a spike in sales, but there will be a gradual climb out and up,” Pember said. “We think we see improved consumer confidence, the housing market is showing some slight improvement, and the inventory on existing home is dipping.”
What's more, because new housing stock is as low as it has ever been, Simonton expects the remodeling market is going to remain strong.
“We just have to be smart on where we spend our money,” said Pember. “And we have revamped our product literature so that contractors can sell our product from products like the Apple iPad.
Chris Pickering, vice president of sales for Ply Gem Windows, however, takes a slightly more cautionary tone, possibly because the Cary, N.C., company is focused primarily on the new home residential market and some commercial multifamily dwellings.
“Our sales are growing, but at a very slow rate because industry sales are fairly flat,” said Pickering.
“We have some composite-material windows that are taking some small share. And we have some fairly steady replacement business. But our business in that market has traditionally been focused on high-end home improvement, so we are adding more products at the low end.”
“We expect 2012 is probably going to be flat, and that there might be a little uptick in 2013,” said Pickering. “We are looking forward to 2014-2015,” when economists project housing will begin to return to more normal levels again.
Single-family housing starts fell to an all-time low of roughly 429,000 in 2011 and are projected by the National Association of Home Builders to rise to 495,000 in 2012.
However, economist Ed Sullivan of the Portland Cement Association of Skokie, Ill., whose conservative forecasts tend to be among the most accurate in the industry, only projects housing starts of 443,000 for 2012 and 587,000 for 2013 compared with a forecast of 723,000 for 2013 by the Washington-based NAHB, which organized the show.