Napa, Calif.– A new executive board was elected for the National Floorcovering Alliance (NFA) at its recent fall meeting, held here. The new board has both youth and experience on its side as it looks to increase member profitability in the age of looming tariffs, a tight labor market and new iterations of WPC/rigid core by the day.
Jason McSwain, McSwain Carpets and Floors, Cincinnati, was elected president for a two-year term; Ian Newton, Flooring 101, Ventura County, Calif., was elected vice president; Raffi Samarzian, Samarzian Brothers Flooring, Toronto, was voted in as treasurer; and Eric Mondragon, R.C. Willey, is the new secretary.
FCNews publisher, Steven Feldman, sat down with the board to discuss how they will tackle key industry issues, grow profitability for its members and the overall plan for the alliance moving forward.
Floor Covering News: What do you see over the next two years as key issues for this group?
Jason McSwain: This transition of leadership just got under way so we will invest in developing this board over the next couple of months, so we can continue to do the work of our membership. There are a couple of things the group has asked us to work on. One is tariffs.
There’s a huge value for me as a retailer in Ohio to have the smart discussion on a topic that is really generational. For the last 20 years, people have not had to develop a strategy for working with tariffs. Being strategic with that will allow us to make sure we are driving that business rather than just letting it impact margin erosion.
Ian Newton: The challenge we had as a group, as an industry and probably even as a country, is that there was no clear communication if [tariffs] were going to happen or how it was going to happen. Even the major mills didn't give us firm direction on how much or what they were going to do until the 11th hour.
Eric Mondragon: This was something we were not accustomed to. Price increases get passed on; we understand. They’re negotiable. But when something like this comes on nobody knew how to really make this work and how it was going to be passed on. There was a lot of differences between vendors on the way they passed it along. Some of them did 10%, some did 3%, some did 7%, so it really created different pricing structures for all of us. And now, we’re just trying to put all the puzzle pieces back together to stay competitive.
Raffi Samarzian: Because we’re invested in such a deep relationship with the vendors, I don’t think there’s much else we can do as a group other than hope they treat us a little differently than the rest of the folks. Our role is to stay elite, and some of that has to work both ways. You can’t just keep on passing the buck onto the customer. Sometimes, we have to work collaboratively with the vendors to make sure the impact of the increases doesn’t turn customers away.
FCN: Could the NFA make a deal for a private-label brand from a domestic manufacturer to circumvent the tariffs?
Newton: I think we see that coming down the road. We’ve seen some opportunity for domestic, exclusive, private-label products for the NFA.
Mondragon: Now, because of what’s happening, we will have to take a hard look at that. Is that the right move for us? Maybe do some private label with some smaller, independent manufacturers who want to do something for us?
Newton: The one thing I see, being on the West Coast, is a huge influx of imports and opportunity and pricing. We have been spoiled with the quality that’s coming from China. They make a good product. Good designs. It’s going to be interesting to see if domestic [manufacturers] can fill that void and have the quality. I haven’t seen the high-end quality coming from domestic like we’ve seen from China.
Mondragon: And they can’t keep up with demand at this point.
FCN: How does the NFA plan to enhance the profitability of its members?
Newton: The value of the group is really in idea sharing. It's not just a monetary thing. Obviously, we try to direct the group to maximize our buying power with different vendors and opportunities that come our way such as the roll buy and buying inventory, but a lot of the value the group has—and probably the board tries to direct—is to get the value out of the communication and idea sharing. Sitting in the two-minute drill yesterday, I probably got six good ideas that I could take back and implement.
Mondragon: It’s not so much just going after the vendors for a better price, a better deal, exclusivity, which are always helpful, but it’s the way we can cut back on operational cost or streamline some of those things that happen behind the scenes with salespeople, installation and prices right now. I think the idea of sharing is really where it makes us all profitable.
McSwain: That really is our charge from the membership. I know my business is more profitable because of the association within the NFA and the ideas from this past meeting. It’s our opportunity to work strategy, to move forward even faster in some ways. In our two-minute drill with 43 members, you are going to get a lot of good ideas. You wouldn’t have gotten that from a book or someone local.
For the full story, see the Nov 12/19 issue of FCNews.