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Guest Column: Benefits of private labeling

Jan 18/25; Volume 30/Number 15

By Chris Coltran

Screen Shot 2016-01-18 at 2.52.24 PMA common complaint I hear from flooring retailers is losing a sale because their client found the same product for less at a competitor down the street or on the Internet. Continuing education for your salespeople is the best way to keep them from losing a sale. Teaching them how to qualify, present products, overcome objections, set up a measure and ask for the order are critical skills that need constant attention from salespeople.

If you are like the average dealer, you gave your salespeople a few hours of training and then put them on the floor. Maybe you hold an occasional sales meeting to go over some new products or promotions and that’s it. Sound familiar?

This is not just a problem in our industry, but in other industries as well. The same washer and dryer with three different name brands, or an identical DVD player sold under multiple brands, is common today in appliances and electronics. Retailers can—and do—overcome training their salespeople by selling products with private labels. In flooring, this is most often achieved by joining a buying group.

Before buying groups became part of the flooring industry, every dealer had the same products, and the lowest price or the best service would usually get the order. Many buying group members rank their private-label samples as the most important benefit of belonging to their particular program. Most mature markets already have key members in their groups and aren’t looking for more. Some of these dealers have no choice but to be a part of a manufacturer-aligned program that gives them private styles and protection from dealers willing to sell at any margin.

So what solution does a new retailer have for private labeling if aligning with a mill or becoming a member of a buying group is not an option? One of my consulting clients, BMC Flooring in Dalton, is the only company I know of that has filled this void in the industry. Founded in 1987, BMC offers an exclusive, private-labeled line of residential and commercial carpets to their members. The program includes products ranging from sub-FHA to high-fashion LCLs—all private and all exclusive.

A retail location can name its BMC program whatever it desires. Flooring RVA in Richmond, Va., for example, named its exclusive line Fashions By Isabel. “My customers see our line of carpets from BMC as our own brand,” said Robert Fletcher, owner of Flooring RVA. “It gives me credibility and I can maintain my margins and not get shopped all over town.”

Bill Briggs, owner of BMC, said the reason the company introduced a private-label program in 2000 was to give retailers an inexpensive buying group option. “Buying groups are expensive, and the dealers who can’t afford them are why we are here. Dealers want low prices, exclusive products, a custom dealer website and access to specials. We offer all of this and more at a fraction of the cost of a traditional buying group.”

While there are many benefits to being a member of buying groups like Carpet One, Flooring America or Abbey; or manufacturer-aligned programs like those available from Mohawk or Shaw, they aren’t always an option for every dealer. Many markets are already saturated. While having a Starbucks on every corner works for coffee, it doesn’t necessarily work in flooring. Small- to medium-sized dealers couldn’t afford the burden of initial fees and start-up costs of a traditional buying group without financial assistance.

To capture more sales I suggest you first train your salespeople. I also highly recommend you give them the advantage of having private-labeled products to sell. For more information, visit BMC Flooring at Surfaces in booth #2433.