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Shaw partners with LG for contract distribution

HICKSVILLE, N.Y.—Shaw Industries has entered the resilient business, thus stretching its portfolio of products to every floor covering category the industry offers, and joining the likes of Mannington and Mohawk.

To move into this arena, the company announced a partnership with LG Hausys, in which Shaw will become the sole distributor of LG’s commercial resilient flooring in the U.S. and Canada.

“This partnership will enhance and balance Shaw’s commercial hard surface offering to include hardwood, ceramic, porcelain, laminate, and now resilient floor coverings,” said Tim Baucom, Shaw’s vice president of commercial sales and marketing.

The partnership officially kicks off in June and will strictly be for commercial products noted Steve DeCarlo, Shaw’s vice president of commercial business development. “This announcement only impacts commercial products and there will not be any changes to [LG’s] residential product distribution channel.”

Simon Hong, president of LG Hausys America, noted the partnership will initially go to market via existing relationships and sales channels established by LG Hausys. This infrastructure is comprised of regional sales managers, sales agents and distributors.

Scott Sandlin, Shaw’s vice president of hard surface business development, added, “Existing contracts and agreements will continue. We will be working closely with current customers, distributors and sales agents to continue to build on the momentum they have developed with the LG line.”

He added, Shaw will maintain LG’s current branding, established sales relationships and channels to market.

As part of the deal, Dave Thoresen, executive vice president of LG Hausys Floors, will be joining Shaw to manage the venture, as vice president of sales and marketing commercial resilient. He will report to DeCarlo.

According to sources, no other LG employee will be moving to Shaw and current distributors will be supplied with the same materials without any interruption in their business, except they will now come through Shaw. While Shaw did not acquire any equity in LG, Sandlin said the two companies “will collaborate on future design product development and innovation.”

Hong said this partnership will pro- vide “world-leading synergism via two major, cutting-edge organizations: LG’s 50 years of product design and manufacturing excellence, combined with Shaw’s legacy of innovative design, sustainability leadership and unmatched logistics network, will allow for radical change in the North American resilient industry.”

Shaw’s Baucom noted, “Shaw’s entrance into resilient will allow us to apply our sustainability through innovation practices to transform this growing product category.”

Hong added, the commercial resilient business represents a $1 billion opportunity, and “Whereas Armstrong and Mannington are currently the leaders…via this strategic alliance, LG and Shaw together plan to assume a major leadership position within the U.S. and Canadian resilient commercial flooring markets in next five years.”

For years, Sandlin said Shaw has been evaluating its options for entering the resilient market, and “this is the right time to expand as a flooring supplier via a solid partnership with a company that has long been known for producing quality flooring. We can learn a lot with this partnership and will continue to make strategic decisions aligned with the needs of our customers.”

Industry analysts agree, saying for Shaw the partnership represents the “perfect opportunity” to enter the resilient category for the first time as it is doing so with an established global manufacturer and personnel for guides.

For LG, sources tell FCNews the deal is a no-brainer as it had such limited resources in the U.S. for distributing its resilient flooring. In effect, the partnership immediately opens up hundreds of new accounts and puts boots on the ground. And one person put it, “LG essentially just inherited an entire team of qualified, professional salespeople all around the country to immediately begin the process of selling the LG line. So, in essence, LG’s sales staff just grew by leaps and bounds.”