Amelia Island, Fla.—Many of North America’s largest and most influential commercial floor covering contractors assembled here this week for the 2024 Starnet spring conference. In keeping with tradition, the event offered attendees valuable educational opportunities while providing a forum for members to network and share best practices.
The theme of this year’s spring conference, “Charting Your Course,” alludes to both the host city as well as the current state of the commercial flooring sector. As Mark Bischoff, Starnet president and CEO, explained: “Amelia Island is associated with pirate island mysteries, hidden treasures and Blackbeard, so we thought we could do something related to that theme and tie it all back to the programs. The message is if the business starts to get soft, there has to be a path through it—much like finding a path through a storm.”
To that end, Starnet management structured the conference programming to reflect relevant topics such as embracing technology, improving sales organization and business management initiatives to help members scale their businesses accordingly and boost their bottom-line profits. “It’s all designed to help members identify their path for the future so they can determine where they’re going to place the focus on their business,” Bischoff told FCNews.
Indeed, despite the stature and success of the 171-member cooperative—which accounts for more than 420 locations generating upwards of $4.2 billion in sales last year—it’s more important than ever to prepare for both current and unforeseen challenges in order to seize opportunities when they present themselves. For instance, while the hurdles related to the corporate office sector are well documented—a situation further exacerbated by office bank loans that are now coming due—backlogs in sectors that are doing well are mounting. Managing all these obstacles requires a high degree of planning and flexibility, experts say.
“Many of our members report the backlog of projects for 2024 is really good, and some of them are comfortable with the backlogs for 2025,” Bischoff stated. “The members in the Midwest feel pretty comfortable regarding 2025; Northeast members are pretty comfortable with ’25; but the West Coast has a bit of a lack of visibility beyond the end of the year. Over the past few years, everybody had been going full blast. Now it’s starting to get regional again.”
Business is also coming from different areas, Bischoff reports. That applies to both product categories and unconventional end-use markets. Take polished concrete, for example. “These are not areas where members normally would’ve played, but now they are because they have the capability of working with those materials and processes. Some are doing concrete restoration or full pours; some of are doing epoxy coatings. Our terrazzo guys are involved in different kinds of projects. They’re starting to expand the scope of work in the same client base that they’re strong in—minus corporate, of course. There’s really not a lot going on there.”
Then there are segments like multi-family. While it’s a sector that’s residential in nature, most multi-family projects entail specified products based on bids. That puts it in the crosshairs of many professional commercial contractors.
“This is where we have seen an evolution in our membership,” Bischoff stated. “They used to not get involved in multi-family, but the volume is so big. They have so many connections with developers, end users and general contractors who say, ‘We want you to do this work for us—we trust you. We know you don’t do it, but we want you to do it.’ And over the last couple of years, because of just the sheer volume, our members have been pulled into it by their customers, and some of them like it.”
By most accounts, commercial construction will be challenged for the remainder of 2024 and into the new year. That sentiment was corroborated by ITR Economics’ Taylor St. Germain, who closed out the Starnet conference with a comprehensive presentation covering a host of timely topics ranging from GDP trends and labor market challenges to inflation and the global economy as a whole.
“Commercial construction will slow down in 2024,” Germain told attendees. “Don’t expect the growth that you’ve experienced over the past few years to continue.”
At the same time, he encouraged contractors to keep up the pressure. “Now is not the time to pull back,” he told attendees. “Continue to invest in your business and your people. This will put you in a better position when the market rebounds.”
(Look for full coverage of the 2024 Starnet spring conference in the May 20/27 edition of FCNews.)