Made in America-Huali Floors: Huali Floors, one of the largest LVT producers in the world, starts U.S. production - May 2021

By Kemp Harr

Just east of Dalton, Georgia, at the foot of Fort Mountain, is a sleepy little town on Highway 411 called Chatsworth. And on the edge of that town is a 400,000-square-foot high-tech factory that was built for $60 million in 2013 by Mattex to extrude fiber, produce carpet backing and employ 200 full-time factory workers. But as fate would have it, when Engineered Floors bought the Beaulieu assets, part of the purchase included a backing factory, so Mattex lost its largest customer and was forced to shut down in 2018 and move its operation back to Saudi Arabia. But before the lock on the fence gate had time to rust, Huali Floors built a new rigid core LVT factory that is breathing life into this 24-acre property.

Huali Floors has invested $27 million to build an ultra-modern rigid LVT factory that is expected to employ 350 workers and produce 250 million square feet of SPC flooring annually by the end of 2023. Initial production is on track to start at the end of this month with the 44 American workers the company has already hired.

Huali Floors, based in Taizhou in China’s Jiangsu Province, is one of the two largest producers of rigid LVT in the world, with 2,000 employees and annual revenues of over $400 million. Due to its scale, the company produces its own print film, wearlayers and attached pad.

This property in Chatsworth has its own rail siding for delivery of PVC chip and calcium carbonate, and the current building only takes up half the property, so there is plenty of room for expansion. It’s also just down the road from the Appalachian Regional Port built by the Port of Savannah, which will streamline delivery of imported components it sources from its parent company.

According to Julian Dossche, president of Huali USA, “This operation has several strategic advantages: we’re closer to our customers, so we’ll be able to reduce their lead times from time of order; there is no Chinese tariff; PVC chip out of Texas is often cheaper than what it costs in China; and last but not least, we’re affiliated with a global leader, so we’ll have access to the latest innovations they develop in their own lab.”

When asked about throughput and quality, Dossche adds, “Our plan is to emulate the same batch process that Huali has perfected in China, which is far superior to the semi-continuous method that was developed in Europe. We’ve added chillers to reduce the humidity and allow the product to anneal during critical stages of the manufacturing process. We’ve also just installed equipment that will allow us to regrind our scrap and reduce our post-industrial waste.”

From a customer perspective, Huali plans to continue to support its existing customer base, which is primarily Shaw Industries here in the U.S. When asked about Huali’s long-term relationship with Shaw, Drew Hash, vice president of hard surfaces for Shaw, says, “The success of any business can usually be traced to a clear vision being set at the very top that is shared by the rest of the organization. That is certainly the case with Mr. Yuan [Huali CEO Huashou Yuan] and the entire Huali operation. Mr. Yuan’s personal story is inspiring, and his work ethic is legendary. Shaw’s ten-year partnership with Huali has been nothing but a win/win for both companies.”

TRANS-PACIFIC LOYALTY DRIVES SUCCESSFUL GROWTH
Here in the U.S., the two biggest suppliers of rigid LVT are Shaw Industries and HMTX. Understandably, the two biggest producers of the product in China are the core suppliers to these U.S.-based firms. HMTX’s core supplier is Yihua, and Shaw’s core supplier is Huali. Both HMTX and Shaw source from other companies, as well, but for both Yihua and Huali, their growth and success can be attributed to the relationships they have with their Western partners. It’s worth mentioning that in both instances the bonds between the ownership families of all four firms are deep and personal-so the focus on performance and loyalty is also personal.

Most students of this business know that Shaw’s giant leap in growth in the LVT category came when Shaw bought US Floors and its Coretec product line in 2016. When Coretec was first launched by U.S. Floors, Piet Dossche was sourcing the product from Tianzhen. As the product took off, U.S. Floors switched its core allegiance to Huali, which had already developed a relationship with Shaw Industries for its Floorté product. So when Shaw bought US Floors, Huali’s two biggest customers became one.

Julian Dossche, Piet’s oldest son and Carl Bouckaert’s nephew, moved to China in 2013 to help close the loop on product quality and nurture the relationships with US Floors’ core suppliers. When Shaw bought US Floors, Julian expanded his product responsibility to include Shaw’s products as well. During that time, he developed a close relationship with Mr. Yuan’s son Philip, who will eventually take his father’s place as the CEO of Huali. Philip’s close relationship with Julian is one of the reasons that Huali decided it could be successful opening a plant here in the U.S.

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