Note: This story originally appeared in Home Textiles Today’s Business Annual issue in December
After several years of economic and operational whiplash, the U.S. area rug industry managed to eke out a modest gain in 2025.
Sales growth for the area rug category inched up this year, growing by a 1.2%, according to Home Accents Today‘s 2025 Universe Report. Sales in 2025 are an estimated $6.95 billion, compared to an estimated $6.85 billion last year, according to the annual state of the industry survey.
For the area rug business, 2025 was less about expansion and more about endurance, noted David Litner, principal of Natco Home Group – which now stands as the nation’s last woven-rug manufacturer following its acquisition earlier this year of the Orian Rugs brand.
Related: Natco Home acquires Orian Rug brand
Even as consumers pulled back, rugs held their ground better than most home categories — aided by their functional appeal, design versatility, and relative affordability compared to furniture and large-ticket goods.
Interviews with leading suppliers — Natco Home, Maples Rugs, Mohawk Home, Oriental Weavers, Nourison Home, Faze Three and Harounian Rugs International — reveal an industry that, while fatigued, remains focused on adaptation. Most described 2025 as a rebuilding year, a period for recalibrating operations and rethinking assortments while leaning harder into design and efficiency as levers of competitive strength.
Where companies differ is in execution. Domestically centered firms like Natco and Maples are betting on U.S. manufacturing and speed to market. Larger global producers like Oriental Weavers and Nourison Home rely on scale, digital assets and data-driven agility. Meanwhile, others like Faze Three are investing aggressively to position themselves for breakout growth.
Across the board, though, executives agree stability will depend not on scale alone, but on responsiveness.
At Maples Rugs, the formula centers on flexibility and relationships. “Over the past few years, we’ve leaned into that agility – realigning production, modernizing our design and printing capabilities and adjusting capacity to meet shifting demand,” said Christa Archual-Nie, accounts executive.
“In today’s retail climate, our three greatest strengths are: speed to market, supply chain stability and collaborative partnership,” she added.
Maples’ vertically integrated model enables replenishment within days, not months — a key advantage as retailers continue operating with lean inventories and tighter buys. That reliability has helped the company navigate a marketplace where operational consistency often matters as much as product innovation.
For Mohawk Home, the path forward is about balance – maintaining robust domestic capacity while using global sourcing strategically. Rugs now account for about one-third of Mohawk’s total business, supported by U.S.-made mats, pads and carpet tile components.
“We do have some domestic capacity but decorative area rugs are still more of a sourced category for us and most of the industry,” said Bart Hill, executive vice president. “The decorative rugs and bath rugs – even with tariffs – are primarily a source product category for us and industry.”
Hill said the company is cautiously optimistic heading into 2026, projecting 2% to 3% growth, modest but meaningful after several uneven years. “We think the market could increase next year – no rebound back to 5% growth, but at least with a 2% to 3% increase across the board,” he added.
At Oriental Weavers of America, the focus has been on performance and design agility. “Our strongest categories this year have been trend-forward, high-quality synthetic machine-made collections that combine fashion-driven design with performance and value,” noted Andy Brumlow, president.
He credits the company’s vertically integrated operations in Egypt – the largest of its kind in the world – with giving it the control and efficiency to weather market pressures. “We’ve also improved our logistics and supply chain capabilities, helping ensure faster deliveries and reliable in-stock performance for our retail partners,” he added.
That combination of scale and speed is supported by technology and trend analytics. “Over the past few years, our business model has become increasingly agile and data-driven,” Brumlow said. “We’re using trend analytics and retailer feedback to shorten development cycles, refresh collections faster and tailor assortments for different channels.”
Heading into 2026, Brumlow is “seeing encouraging signs of renewed interest in home décor and renovation,” particularly in “performance, washable and sustainable product segments.”
At Nourison Home, the year was defined by steady performance and strategic investment, explained Alex Peykar, co-founder and co-chairman. Rugs remained the company’s strongest segment, while its Georgia-based domestic finishing and warehousing operations improved service and fulfillment speeds.
Industry executives expect steady growth in 2026, underpinned by innovation and supply chain agility. The company also continues to produce a range of broadloom carpets in the U.S. using globally sourced materials, pairing craftsmanship with modern design. “Our priority remains delivering exceptional value through design, quality and service – without compromising craftsmanship,” Peykar said.
Adding a notably bullish note to the industry’s cautious tone, Faze Three is forecasting 28% to 38% growth in 2026, positioning area rugs as its breakout story.
“We’re optimistic about 2026, having made the hard investments in 2025 that will drive accelerated growth,” said company president Vishnu Ajay Anand. After years of technology investment and market development, Faze Three reports “strong retail interest in our capabilities” and expects to more than double its current run rate as its “unique speed-to-market advantage becomes widely recognized,” he continued.
Those gains are backed by the company’s new ERP implementation, fully deploying this year to deliver operational efficiencies, better inventory turns and enhanced customer service.”
That said, the flooring market is undergoing structural change. “The flooring industry will continue bifurcating,” he said. “Retailers are desperate for suppliers who reduce their risk while keeping them trend-relevant. Winners will offer flexibility, customization, speed to market and operational reliability.”
Functional categories such as bathmats and doormats should remain stable, buoyed by ongoing renovation spending. Decorative segments, particularly area rugs, “will reward innovation and agility,” Anand continued. “The real opportunity is for manufacturers who’ve invested in capability, not just capacity.”
Harounian Rugs International (HRI) continues to find strength in classic and custom-made offerings. “Traditional continues to be a strong trend,” said Lee Harounian, principal. “Our custom size and made-to-order category has really been a growth segment of our business.”
Harounian remains cautious about the broader economy. “Due to the current upheaval in so many segments of our country’s economy, it is impossible to foresee what our business is going to look like in 2026,” he explained.
Nonetheless, the company has aimed to shield its customers from the brunt of cost pressures. “We protected our customers the best we possibly could by absorbing most of the outrageous tariffs that were imposed on countries we have worked with for over 60 years.”
Moving into 2026, the tone across the rug industry is pragmatic but quietly hopeful. Rug makers have learned to balance creativity with control, betting on efficiency and responsiveness to carry them through uncertain cycles.
