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National Floorcovering Alliance: Warm weather drives first quarter

But start of spring uncharacteristically slow

by Steven Feldman

Dove Mountain, Ariz.—The soon-to-be 40 members of the National Floorcovering Alliance (NFA) found business slowing in April after a stronger-than-usual first quarter. While things usually pick up in the spring, the warm winter may have driven consumers to make flooring purchases that in other years would have been postponed to April.

In any case, just about every member believes they will be up for the year with projections ranging from 5% to 15%. Of course, some of that could be inflated if 2011 was particularly disappointing.

Jim Jensen, president of Fashion Carpets/Carpet Mill Outlets in Denver, said business for the year is up between 10% and 15%. “Warm weather has led to increases in months where we lose a great deal of money.” This was echoed by Zac Akin, co-owner, Floor World/Budget Floor Store in Oklahoma City, who cited “balmy” temperatures for a first quarter up “quite a bit” from 2011.

For the Berkshire Hathaway-owned R.C. Willey, a “great” fourth quarter was followed by a 5% increase in the first quarter over 2011. “Traffic has been off in April, but the average ticket has been up,” said Eric Mondragon, hard surface buyer. “The customers coming in are buyers and not shoppers.”

For some, business is tied into giving consumers reasons to buy. Darren Braunstein, vice president, Worldwide Wholesale Floor Coverings in New Jersey, reported light traffic in between events, when the retailer does experience a great deal of traffic. However, a new store opening in October that has “met and exceeded expectations” has led to a 30% increase this year.

NFA members, considered among the best of the best in the flooring retail world, have employed a number of strategies en route to growing their businesses, both during 2012 and through the recession. They include:

•new store openings

•search engine optimization

•consistent messaging on Facebook,

Twitter and Web

•Stainmaster private sales

•Armstrong Elite program

•Spring home and garden shows

•renegotiating leases

•diversifying into window treatments

•purchasing drops on hard surfaces

•putting more designers on the sales floor in lieu of salespeople

•changing salesperson compensation structure from commission to salary

•hiring installers vs. subcontractors

•subletting space within their stores

•recycling

New blood

NFA welcomed its soon-to-be 40th member, A.J. Rose Carpets & Flooring, a second-generation, 35-year-old retailer with two stores in the Boston area—one primarily commercial, the other mid- to high-end with a 70/30 residential/commercial mix.

Co-owners A.J. and John Boyajian were thrilled to just be considered for membership. “We are lucky and happy to be part of the NFA,” A.J. Boyajian said. “The sharing of best practices is incredibly interesting to us. It is like getting outside consultants to come in and help with the problems you are having. You can gain a perspective from 10 different angles and learn there could be as many as five solutions to a problem. As a business owner, you always ask yourself, ‘What else can I learn?’ Then you come here and learn there is a whole lot more to know.”

John Boyajian mentioned the immediate credibility with suppliers as a lure. “You always think you are getting the best price or best service. Then you come here and find there are ways to buy better and be better serviced. This group gives you access to a higher level executive at a mill.”

In other NFA news….

•Jenson, chairman of the Advisory Council, surveyed NFA members as to how the vendor-member relationship could be improved. The overriding result was more unique promotional opportunities. One member said he felt that not enough of NFA’s 25 Tier 1 vendors came to this meeting with something to sell. “They were showing us their fall introductions,” he said. “They need to do a better job of sizing up each one of us to find our individual needs. That is a way for them to get more out of us.”

•Dreamweaver Carpet has approached NFA about a private-label display program. “Bob Shaw wants to get involved in organizations such as this,” said Jeff Macco, chairman of the carpet committee. While he acknowledged the mill’s manufacturing capacity is outstanding, he told members this would be a “no-frills program. The rep will not be coming into your store every week. You will pay for samples. But there are great margin opportunities.”

•NFA members as a group are doing well with laminate. It was up 2% in purchases in 2011 with Shaw and Mannington, the biggest beneficiaries.

•IVC has created a private-label, fiberglass sheet display for NFA consisting of 27 SKUs in primarily beiges and grays. “This is an example of a Tier 2 vendor looking to get more involved with us,” said Michael Longwill, Airbase Carpet Mart, and president of the resilient committee.

•Worldwide Wholesale, with three stores in New Jersey, showed NFA members a pair of well-produced, professional, advertising spots that highlight the specialty retailer’s value. Worldwide is offering them to NFA members with a customizable tag for a fraction of the cost it paid to produce the commercials.