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My take: The one column you must read

July 8/15, 2019: Volume 35, Issue 2

By Steven Feldman

 

Back in the Oct. 15/22, 2018 issue of FCNews, I wrote an editorial about my friend Steve Joss, owner of The Vertical Connection Carpet One in Columbia, Md. For those who suffer from memory loss or are new to this publication, Steve was among the 100,000-plus people in this country awaiting a kidney transplant. My intention was to offer four takeaways from that column:

1. All the money in the world may get you lavish cars and luxurious estates, but it still doesn’t buy health. So stop killing yourself trying to make every last nickel.

2. You can complain about what you don’t have—in Steve’s case, a working kidney—or you can be thankful for all the good things in your life. Steve never complained about driving to dialysis three times a week and getting hooked up to a machine for four hours; maybe he griped about the traffic to get there.

3. In times of adversity, you have two choices: feel sorry for yourself or cling to hope and stay positive. You never know what the future holds.

4. If you ever have a loved one who finds himself or herself in this unfortunate situation, know that the University of Maryland kidney trans- plant center has made it easier than ever to donate. You are home in one to two days, back to work in a couple of weeks. And if you donate a kidney and ever need one, you move to the top of the list. It’s almost like an insurance policy.

Anyway, about nine days after the Oct. 15/22 issue hit the streets, at 4:39 p.m. on Halloween, as ghosts, vampires and superheroes were beginning to populate the streets, a real superhero emerged. No costume. No weapons. No superpowers. He did not walk into my office looking to save the day. Rather, his words showed up in a late-day email looking to save a life:

Hey Steve,
I was reading your article about Steve Joss on Monday, and I was extremely touched by it. After doing my own research about the donation process and everything it entails, I would love to see if I’d be able to help Mr. Joss. I understand that there’s an extensive vetting process to see if I’d even be a match, but if it gives him a fighting chance to go back to a normal life, it’s something I’m willing to commit to. I’m 25, in good health and have no past health issues to speak of, so I’m hoping my odds of being a good match for him are decent. I understand that time isn’t much of a luxury he can afford right now, so you or any of his family are welcome to contact me on my personal cell anytime. Thank you for putting Mr. Joss’s story out there and I hope to hear from y’all soon.

The email was signed by someone named Jes Smothers. Jes works on the sales side at WC Carpenter in Virginia Beach, Va., a successful Starnet member. He has hardly been in this industry for a year.

As a man who prides himself on keeping his emotions in check, it was at that moment where I completely lost it. I started shaking uncontrollably. I was excited to help connect Jes and Steve. (For the past 25 years all I’ve been doing with my life is trying to make floor covering retailers more profitable and professional.) Noble, maybe, but difference making? Eh. The notion that one 600-word column could potentially help save a man’s life was way beyond the realm of my existence. I couldn’t even remember Steve’s phone number to give him the potential good news. My brain shut down, and I could not find it anywhere. Didn’t even know where to look. I dialed about 20 wrong numbers. No joke.

That evening I connected the pair, but you know, a lot can go awry from the time someone says, “I want to donate a kidney,” to going under the ether. We’re talking about six months here. There are a litany of medical tests that must be satisfied, not to mention relatives, significant others, friends and co-workers who will try to convince you that you’re insane. Jes encountered little of that, and when he did he was undeterred. Nor did he ever second-guess himself. Not once.

Then you have the hospital asking about 500 times, “Are you sure you know what you’re doing?” Oh. And then there’s one more hurdle to clear:

the donor and kidney recipient must be a match. Everything else can fall into place, but if you’re not a match, well, all you have is good intentions without execution.

As it turns out, Jes and Steve were not a match. But the story doesn’t end here. (Spoiler alert: It gets better.) Jes was still able to donate a kidney, and because of that, not only was Steve able to receive one from the kidney bank but a 12-year-old boy’s life was saved and is now walking around with Jes’ kidney. So not one, but two lives were saved by this heroic human being.

As I write this on July 2, all three are doing well today. Not every story has a happy ending, but this one does. Recently I met Jes in New York City for the first time since the procedure. He’s an incredible young man who you will be learning a lot about in the pages of FCNews going forward.

I must say watching all this unfold over the past seven months has changed my outlook on life, and I want to offer up a few nuggets to consider:

1. It only takes one. Probably 40,000 eyes, give or take, view this column from week to week, but only one person sent an email in response to the column on Steve Joss. Jes was the one.

2. Never give up hope. Greek mythology tells us when Pandora opened her jar, all evil escaped, but Pandora (under Zeus’ will) held hope inside by closing the lid. Hope will always live.

3. Just when you thought everyone on this planet is only looking out for themselves with no regard for their fellow human beings—especially strangers—along comes Jes Smothers.

Last but not least, our role as journalists—and I not only speak for my fellow editors/publishers in the flooring industry but any journalist who has a forum—affords us the ability to make a difference in this world. It’s both a responsibility and a privilege that we all must embrace.

The end.

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My take: The numbers—What you need to know

June 24/July 1, 2019: Volume 35, Issue 1

By Steven Feldman

 

The most arduous task of the year is now in the rear-view mirror. The FCNews team has been combing through industry statistics for months, making countless phone calls and trying to extrapolate data from annual reports. But at long last, the 2018 statistics are in the can. When the dust settled, FCNews pegged U.S. floor covering industry sales for 2018 to be a shade under $23 billion as well as 19.625 billion square feet, resulting in a gain of 4.57% in dollars and a 0.56% decline in volume. Interestingly, we saw a larger percentage gain in dollars than for 2017 but the first drop in volume in seven years. Carpet was the culprit.

Every year I like to remind our readers that these statistical reports are like... well, never mind. Let’s just say, everyone has one. While we are quite confident in our assessment of the industry, we know other reports will have different results for varied reasons. First, some reports contain sales of stone flooring. I have seen some reports that have pegged stone flooring to be around $1 billion. Stone includes marble, granite, travertine, slate, etc., which have uses beyond flooring. We could call stone suppliers and get their assessments, but that would be purely anecdotal.

Another part of the floor covering world not included in this report is polished concrete. My friend Curt Thompson, formerly of Wilsonart, is in that business today and argues that polished concrete is bigger than anyone in our industry wants to admit. If our commercial volume numbers are less than what you thought, polished concrete may be the culprit.

Now, when it comes to ceramic, that number may be larger in other reports. That’s because those may include wall tile. Today, so much of ceramic can be used interchangeably on the floor or wall. We have reached out to many industry insiders, and the feeling is floor tile represents about 75% of the total ceramic number, give or take. So that’s what we use.

Likewise, our rubber numbers include only tile and sheet flooring. Two years ago, we made the decision to eliminate cove base, accessories, stair treads, etc. We revised our numbers back five years to reflect this change. So, that $227.4 million encompasses what we seek to identify.

Other reports rely solely on government numbers, which requires massaging if you stress accuracy. For example, there isn’t anyone who believes the U.S. hardwood flooring market is over $3 billion. The government number for hardwood flooring includes things such as wood for tractor trailer beds and mislabeled engineered wood-based flooring products that use MDF or HDF as their primary cores.

Arguably the most difficult category to nail down accurately is resilient. There is so much that constitutes the segment: sheet, LVT and its subsegments WPC and rigid. You also have VCT and the inexpensive peel-and-stick tile.

FCNews has taken a unique approach these past few years. I personally call every manufacturer that does any appreciable business in the category with the promise of confidentiality. That’s what 25 years of not betraying anyone’s trust has earned.

This year posed some new challenges: first, trying to get a handle on imports and deciphering between WPC, rigid and straight LVT. Second, in a word, Armstrong. It’s like the “Iron Curtain” over there. Its annual report reveals as much as an Amish woman’s dress. Hey, here are our sales and we’re about 20% international and 40% residential/40% commercial. Well, first, a former employee in the know told me the business was 60% commercial. I know the VCT number. So, if you take the overall number, factor out the international business, give the company a 40/60 commercial split, factor out the VCT component, you wind up with about $230 million residential sheet and tile, and $130 million commercial sheet and tile. From there, the research boils down to assessing the sheet/tile split. Luckily, we don’t have to do that exercise too many times.

Are our numbers exact? No. Are they as good or better than anything out there? Yes. And for the record, WPC/rigid for 2018 was $1.6 billion residentially and another $150 million commercially. That’s where all the industry growth is coming from, in case you’ve been sleeping under a rock for a year. (Since I’m asked that question at least once a week.)

As for determining that “other” LVT/WPC/rigid number, this is the piece we estimate. There are a lot of companies doing between $2 million and $10 million in imported product; it would be impossible to talk to each and every one of them. But we think we have a good handle on what’s coming in.

Enjoy the report.

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My take: Capitalizing on the sense of belonging

June 10/17, 2019: Volume 34, Issue 26

By Steven Feldman

 

Membership. It’s a concept we don’t really think about much, yet seven out of 10 people belong to some sort of club or organization, according to the American Society of Association Executives. This could be anything from a religious group to a frequent flyer program or the Chamber of Commerce. Putting it another way, 70% of us are “joiners” who like the sense of belonging.

This is why American Express and other credit card companies refer to their users as members, why there are travel clubs and so on. There are even clubs that start out of their own volition, like the Parrotheads—fans of Jimmy Buffet—or the Deadheads, which pledge their allegiance to the late Jerry Garcia.

Each political party has different “clubs” used for fundraising. Magazine and newsletter subscriptions are positioned as memberships, i.e., the National Geographic Society.

Even without attaching a name to it, Hugh Hefner brilliantly marketed Playboy magazine from its inception as something more. The “what sort of a man reads Playboy?” advertising convinced a generation of men that reading the magazine meant being part of a uniquely appealing lifestyle and philosophy. Even the wearing of logo apparel is, in a way, striving to “belong.” If you pay attention, you’ll see “membership concept marketing” at work all around you.

Here’s the thing: Not only do people respond to this concept, they also derive reassurance from it. Instant credibility can be created solely via the right association branding. Response percentages almost always go up when marketing is done under the auspices of an association or membership.

In addition, in an ever-more-confusing marketplace, consumers use their memberships as a shortcut for sorting out choices. For example, members of Sam’s Club or Costco feel comfortable ignoring ads and coupons from competing grocery stores, instead buying everything where they are a member, trusting they are getting the best deal there.

Taking this concept one step farther, like cats that are always eager to get into whatever room has a closed door, people tend to desire most what they can’t have. Whether we want to admit it or not, we lust after other people’s things—cars, jobs, even significant others. A closed door is as arousing to humans as it is to cats.

This was the subject of an article I recently read that was referred to as “red room/blue room marketing.” The premise is that it’s easy to make everybody in the red room desperately want to join the group in the blue room, and to make everybody in the blue room want admission to the red room. This has many applications, including making prospects “qualify” to buy.

There are two ideas you might want to consider in your own marketing initiatives. No. 1, packaging certain benefits, services and products you now sell and/or deliver routinely together as the privileges of “membership” in a named club or organization; and No. 2, creating a new “club” to market, and to use that as the means of attracting customers to your stores who might otherwise ignore you and/or sustaining greater customer loyalty and higher margins.

Think about this for a second: What if you created the “XYZ Flooring Loyalty Club” for past customers. Send them special offers every month or so. Private sales would fall into this category. Be creative, but make these customers feel like they are receiving something they will not obtain anywhere else. Make them feel like they are getting the best deal possible.

Taking this one step farther, get a list of new homeowners in your area. They will be purchasing flooring now or in the not-too-distant future. Induct them into the club. Provide them with special offers. Make them feel special. Create perceived value.

Of course, you can reach out to anyone and offer them membership. But the key, like American Express has conveyed for years, is that “Membership has its privileges.” Or at least we believe it does.

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My Take: Award of Excellence—Behind the results

May 27/June 3, 2019: Volume 34, Issue 25

By Steven Feldman

 

This issue of FCNews is a bit different than the other 25 we publish throughout the year. For starters, it offers a commercial slant given its distribution at NeoCon, the premier event for the contract design industry. This issue also heralds the 23rd Award of Excellence winners, which produced results that were quite similar to the year prior with a few exceptions. That’s not so surprising given that a company in one year isn’t likely to fall off a cliff in their partnerships with retailers—unless something has gone terribly wrong.

With that said, while FCNewspublishes the winners in their respective categories, what you don’t see are the voting trends from year to year as it relates to specific companies. So here it is—Award of Excellence: Behind the results.

First, I am always fascinated by the voting in and of itself—in particular, the “other” category, which encourages the voter to write in a somewhat lesser-known company that does not appear on the ballot but is still a key partner to their business. Note: You don’t have to write in Shaw or Mohawk here; they already appear in category A. I also enjoyed seeing the votes for Beaulieu. Maybe next year I’ll get a few Kentiles.

Anyway, the most interesting thing to me this year was the Cushion category. For the past few years, Carpenter and Leggett & Platt staged an all-out war in the voting with Carpenter winning by less than 20 votes each time. This year Leggett & Platt won by more than 100 votes. When something like this happens, you have to wonder why. In this case I am guessing Leggett & Platt has underlayment for the burgeoning LVT segment where Carpenter does not. Beyond that...?

The second thing I found interesting was how Armstrong fared in the voting over the last couple of years. Two years ago, the company that once owned the resilient category garnered 10.6% of the LVT vote, 15.3% of the sheet vote and 2.3% of the WPC/rigid category. This year the numbers were 6.4%, 12.6% and 2%, respectively. Again, is the competition stepping up their game or is it internal? It’s not for us to say because we don’t know.

The third voting trend that caught me off guard was the Hardwood B category, where Mirage returned to the winner’s circle after a two-year absence. The Canadian company, considered by many to be at the pinnacle of quality, had previously won five straight until the streak was snapped. USFloors, which pioneered the WPC category, still offers hardwood flooring, lest we forget, and gets a whole lot more votes than people would ever imagine.

Some other observations:

  1. Mohawk took 54% of the carpet vote two years ago and 55% this year. Consistent.
  2. In the Carpet B category, Anderson Tuftex, Dixie and Phoenix all increased their shares of the vote by at least two percentage points.
  3. In the Commercial Carpet category, Mohawk went from 50% of the vote to 42.5%, still a hefty number, with Mannington Commercial picking up almost the exact same percentage gain. It was its best showing ever since the category launched a few years ago.
  4. Almost every company dropped share in the Hardwood category except Mannington, which more than doubled its 12% share from a year ago. Shaw was obviously the strong player this year, winning the category after taking a back seat to Mohawk last year.
  5. Karndean impressed in the LVT B category, going from 25.5% of the vote to 36%.
  6. For the second year in a row, Mannington commanded a 38% share of the Commercial Resilient votes. This is after being swamped by Johnsonite every year since the category’s inception a few years back.
  7. Mannington also took Resilient Sheet with 31.1% of the vote. The company commanded just 16.9% of the vote the year before.
  8. Mohawk might not like the word “laminate” but it had a dominant position this year thanks to RevWood.
  9. The Laminate B category was tight again between Inhaus, Alloc and Swiss Krono. Only 10 votes separated the three.
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My take: A different take on Einstein’s definition of insanity

May 13/20, 2019: Volume 34, Issue 25

By Steven Feldman

Every so often something comes across my desk that resonates with me. One such piece comes courtesy of Sam Page, founder and CEO of NeuroTriggers Group, a boutique business consultancy that specializes in new customer acquisition, conversion, retention and profit optimization.

The firm was founded on the premise that the ability to get more customers is a function of how well a person grasps the underlying principles of human nature. Neuromarketing, as Page calls it, is taking the latest findings from psychological science/behavioral economics and applying it to real-world marketing and sales processes. People are driven entirely by their psychological makeup, and how we think (cognition) triggers how we feel (emotion), which triggers how we buy (behavior). Bottom line: We can influence the buying behavior of our prospects.

Anyway, Page was writing about a conversation he had with a very frustrated, disappointed and unhappy man in the midst of his sixth divorce. He was, as you might imagine, very down on women and on marriage. Page suggested poor luck of the draw might deliver one, two, maybe even three insane and evil wives. But six? It had not occurred to the man that he was the common denominator in those relationships.

The same thing holds true of the per- son whose every strategic alliance, client relationship or opportunity is either dead on arrival or goes south at some point down the line. Or the sales professional who finds himself engaged in fierce battles with unreasonably cheap prospects time and time again. Or the person who loses weight but gains it all back, going from diet to diet, eventually claiming all diets to be frauds. Or the employee who goes from job to job, at each one finding an awful boss and nasty, spiteful co-workers.

Of course, you can’t assume all trouble is of your doing. After all, the world is filled with challenging individuals. But if you smartly de-personalize situations and detect a pattern of unsatisfactory outcomes, you should stop and question your modus operandi. Not your self worth—your strategy.

Let’s assume you determine your methodology is the common denominator in a “Groundhog Day-esque” series of repetitive nightmares, and for whatever reason or excuse you are unwilling to change your behavior. At that point, you need to fire yourself from that position and either get somebody in there who can do that job well or find a way to be free of it altogether. Most people do neither, and instead just continue down the same path of insanity.

Here are five steps you might recognize in yourself and/or others:

1. Walk down a street and fall into a hole.

2. Walk down the same street, fall into the same hole, and be surprised and pissed off at the hole.

3. Walk down the same street and try to speed up and jump over the hole but fall in anyway and now be really pissed off at the hole.

4. Carry ropes, a flashlight, a ladder, walk down the same street, fall into the same hole but get out—filthy with a sprained ankle and still pissed off at the hole.

5. Walk down a different street.

This all reminds me of an old joke: Two construction workers are sitting on a beam opening their lunch boxes. Worker No. 1 says, “Damn. Cheese sandwiches again!” Worker No. 2 asks, “Why don’t you ask your wife to fix you some- thing different?” Worker No. 1 replies, “I live alone and pack my own lunch.”

It is hard to accept the fact how little control we have over the holes which appear before us. But to always have things fit your way is profoundly limiting. Maybe it’s just time for new ways.

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My take: What you need to know about Generation Z

April 29/May 6, 2019: Volume 34, Issue 24

By Steven Feldman

 

Everybody is talking about millennials. That’s your customer of tomorrow. But for the longest time I’ve been advising against losing sight of your customer of today—the baby boomer, who still controls the lion’s share (roughly 70%) of all the disposable income in this country.

But since so many of us like to look ahead, while you are doing all that research on millennials and their shopping habits, you may want to get yourself acquainted with another important demographic: Generation Z.

This is the year Generation Z becomes the biggest consumer cohort globally, displacing millennials as a top obsession for people trying to figure out how to cash in on their unique shopping, eating and media habits. They make up 26% of the population. Nearly 50% identify themselves as non-white compared to 28% of boomers. While they might still be in school, they have spending power to the tune of $143 billion in the U.S. alone.

Generation Z, roughly between the ages of 8 and 22, were born after the Internet went mainstream and occupy a world where marijuana is going legal in several states. Anything and everything can be delivered to their front door with a swipe of a finger, and they grew up on platforms like Snapchat and Instagram, where the influencer culture has taken hold. Fifty percent say they are connected online at least 10 hours a day, and 70% say they watch more than two hours of YouTube each day.

Here are some broad trends you may want to consider when targeting the Generation Z shopper in the years ahead:

1. They can be influenced. While older millennials graduated college before the rise of Facebook, or even mobile phones, these new consumers live on Instagram and other platforms. In fact, 52% said they primarily find out about new products from social media, a jump of 10 percentage points from millennials and double the rate for their Generation X parents, according to a recent survey by Bloomberg News and Morning Consult.

That means influencers—celebrities or everyday people with big social media followings who are paid to promote products—can have an outsized impact with this group where nearly six out of 10 self-diagnose spending too much time on their phones.

2. They have different vices. Younger consumers are wary of nasty hangovers and eager to wake up on the weekends feeling fresh so they can get outdoors and capture selfies. Beer in particular is going through a slump as Americans cut back on alcohol.

Marijuana, meanwhile, is going mainstream. It’s perceived as healthier than alcohol by many Gen Z consumers and is now legal for adult use in 10 U.S. states. Gen Z consumers are coming of age in a time when the decades of stigma around weed are fading away as more states legalize marijuana. Gen Z in the U.S. is twice as likely to use cannabis than the national average.

3. They don’t have to go to stores. Gen Z could be the first generation to truly embrace online grocery shopping—though maybe not yet. Just 83% of them said they primarily purchase groceries at a physical store compared to 95% of baby boomers. Surveys have also indicated that Amazon is one of the favorite brands of Gen Z consumers, who’ve never lived in a time without the e-commerce giant.

4. They choose their brand loyal- ties carefully. The rise of Gen Z could be bad news for traditional clothing retailers like The Gap and Macy’s, already battered by the shift to buying clothing online. The next generation is also embracing second-hand apparel, which will be bigger than fast fashion within the decade, according to Thredup’s 2019 Resale Report. Thredup, a fashion resale website, says more than one in three Gen Z shoppers will buy used clothing this year vs. less than one in five boomers or Gen X consumers.

They may not be your customer just yet, but they are coming in the next five years.

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My take: Issues and answers from the Fuse Alliance conference

April 15/22, 2019: Volume 34, Issue 23

By Steven Feldman

 

Last month I had the opportunity to attend the Fuse convention in Orlando. This group of commercial flooring contractors, under the auspices of executive director Geoff Gordon, continues to grow and become more professional and profitable by the day. One of the highlights at general session was a segment that Gordon had initiated where members were asked about some of their pain points—the responses to which could have been the same for many factions of our industry.

When asked about their biggest challenge today, five topics were most cited:

1. A shrinking and aging labor force. On the union side there is INSTALL, which is a proactive group. Gordon said they may fallen a little short on the recruiting side but their training is excellent. On the non-union side there is CFI, which has partnered with Fuse on an initiative to bring younger generations into the industry.

2. Cash flowwithout it a business simply won’t survive. Thus, Gordon told members they must be all over their receivables.

3. Moisture. The consensus is vendors are rolling out solutions that some members don’t consider to be reliable.

4. Reclamation. It is becoming harder to completely recycle all carpet materials, multiple members said. Broadloom is more difficult than it was 10 years ago, mainly attributed to PET taking so much share from nylon. A lot of recyclers are gone. And it is also less expensive to make new material than to recycle.

5. Pollution control, with mold fungus being the No. 1 culprit.

Members were also asked what they were doing to engage younger people. Among the responses:

1. With Generation Z, 24-26 months is typical retention. The idea is to ensure they have a path. They want a plan. Outline it for them. Give them some skin in the game and an opportunity to earn more.

2. With labor, many subs have a hard time bringing people on because they don’t offer benefits or a 401K. One member said he hires his own installers, trains them and makes sure they have a buddy. This company also has an annual retreat for everyone in the office. Last time the retreat included installers. The result: Installers came out of their shells.

3. Another member said he maps a path for millennials. “We keep them engaged in the culture. You want a culture that is dynamic but it takes work. Create a culture that people want to be a part of, something greater than themselves. Try to create a family.”

4. One member said he goes to the local community college to look for people involved in construction trades. If they have interest in what they are going to school for and thinking long term, he will bring these individuals on board. He will also get them involved in committees within the company, like safety.

5. One member said he simultaneously uses hourly installers and subcontractors. But he puts his core values out there. “Imparting those beliefs in our 1099 installers has returned dividends,” he said. “We try to involve them in the company. They may not be employees, but we can instill that culture in them.”

Sensitive topic: Do you see claims going up or down? Just about everyone said claims are up. Why?

1. Value engineering. “Manufacturers are taking shortcuts,” one member said. “Lightweight carpet tiles are as thin as Kleenex.”

2. Instability in vinyl flooring. “That is a product defect, not an installation issue,” said Lew Migliore, claims resolution guru, who was in attendance. “We are inundated with issues related to LVT/LVP every single day. It’s an epidemic. There is a lot of overselling. There are fewer technical people who know anything about it. In the last two years, anything I’ve looked at is not installation related. People tell you the building is expanding and contracting. It’s the most ridiculous thing I’ve ever heard.”

3. The new moisture-resistant adhesives. “They do nothing to stop moisture. You will get blamed. Words don’t change the laws of physics.”

4. Recycled content. “No one knows what’s in that material. Instability is happening on the greener products. We are finding better results with virgin material.”

5. Jobsite conditions. “We encounter condensed schedules for installers, which is unfair. We are the last trade going in.”

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My take: Random ramblings three months into 2019

April 1/8, 2019: Volume 34, Issue 22

By Steven Feldman

 

It’s hard to believe we’ve passed the quarter mark on 2019. Time flies when you’re having fun. Or getting older. So three months into 2019, here’s what’s on my mind, which these days is going in more directions than a 2-year-old after drinking a Red Bull.

I think Brian Carson was the perfect choice to lead AHF Products given his strong manufacturing background... Trust me when I say this: COREtec Stone is the next big thing. Some retailers have said this will replace their entire ceramic department... I attend almost every retail group event, and there’s something different about CarpetsPlus— a different feel, a different level of enthusiasm, a different level of camaraderie... I don’t want to sound like I’m drinking the Kool-Aid, but when just about every NFA member takes on a new vendor in its first year, my antenna goes up. It’s Cali Brands, it’s that Meritage collection, it’s Doug Jackson...

Sad to learn of the passing of former Galaxy, Mohawk and Lexmark executive Ed Williams. Not many details, but word on the street is it was a farm accident. A true gentleman in every sense of the word. Rest in peace... Speaking of Mohawk, Paul De Cock is certainly putting his stamp on Mohawk Flooring. Everyone I speak with is a believer... Happy to hear a couple of Sams are on the mend. Sam Roberts, who suffered an aneurysm a few months back while skiing, will be as good as new, and Sam Ruble, formerly of USFloors and now with Foss, was back in action at the recent NRF event after suffering from a heart ailment. Both seem to have averted more serious fates...

The Domotex USA conversation continues one month following its inaugural edition. Surfaces can rest easy that the success Hannover Fairs enjoys in Germany and China likely won’t be replicated here. The 2020 event will go a long way in determining whether we’ll be talking about it in 2021... No matter the city, you always get a top-notch steak at Mastros... I like that retailers remain optimistic for 2019 following a slow two months to open the year. They’ve been encouraged by a healthy March, which hopefully continues into April... Labor still remains an issue whether you are on the residential or commercial side. Someone better figure something out fast, because the installers we do have aren’t getting any younger...

Gotta find it interesting how no one wants to call a laminate a laminate anymore. It’s almost like years ago when people ran away from words like linoleum and vinyl. It’s gotten to the point where the NWFA had to launch the “Real Wood. Real Life” campaign to
address all the confusion in the market
today... Also find it intriguing how many are getting away from the traditional 5-ply engineered wood construction and replacing that with non-traditional wood cores topped with thinner veneers. Better or worse? The consumer will decide... People who need to use the restroom more than twice per flight should not purchase window seats when they fly. Just sayin’... Is there any limit to how expansive this rigid core category can become? At what point does the momentum begin to wane? Hopefully commoditization doesn’t set in anytime soon...

Check out Raskin Industries’ Brooklyn Reserve collection ad on page 27 in our March 18/25 issue. One of the more creative ads I’ve seen in awhile... Retirement has called Jeanne Matson of Starnet and Deborah Hardin of USFloors. Matson has been running Starnet since Lori Dowling stepped down in 2006; the May convention will be her last. Hardin has been a vice president at USFloors pre-COREtec... Awaiting the forthcoming launch of Karastan hardwood. If it lives up to the reputation of Karastan carpet and rugs, it will be a home run... Only about six weeks until the Award of Excellence winners are announced. I wonder who Russia wants to win.

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My Take: The NFA—The best of the best

March 18/25, 2019: Volume 34, Issue 21

By Steven Feldman

 

So I just got back from Whistler, a ski resort town nestled in the foothills of the Coast Mountains in British Columbia. It’s two hours north of Vancouver, a place where tranquility serves as a juxtaposition from the bustling city life. It also served as the backdrop for the National Floorcovering Alliance’s spring meeting.

On the third day of the gathering, inside the Westin hotel in a large ballroom, the NFA held what has become its legendary vendor meeting. Think speed dating on steroids. The 26 core vendors pay good money to get 18 minutes with each of the 42 members—dealers who collectively do more than $1 billion in business. It’s money well spent. Here is where these suppliers seek to get a larger slice of that pie. They attempt to entice members with proprietary product, sharp pricing and anything else that may give both sides an edge on their respective competition.

Deals may not get consummated in those 18 minutes, but the groundwork is laid. I sat in on a few presentations, and here were some takeaways:

1. USFloors is up 23% with the entire group and 34% with the NFA’s proprietary Lifetime Luxury brand, which is being expanded with nice SKUs. Piet Dossche, USFloors CEO, stressed that while everyone is talking about waterproof, COREtec has great looks, which is the No. 1 driver—oh, and by the way it also happens to be waterproof.

2. Shaw Hard Surface was up 26% with the NFA in 2018, better than two times the growth it experienced with the rest of the universe. The key? Variety in waterproof products compared to others.

3. Emser presented a porcelain program that includes polished and matte wall panels into the proprietary Lifetime Luxury brand. The highlight? Normally a retailer will buy polished for 50 cents to a dollar more than matte; this program nearly equalizes the cost.

4. Cali, a relatively new core vendor, is justifying its spot at the table. It closed 92% of the members at the last meeting with its Meritage engineered hardwood line. The product competes with DuChâteau at a more aggressive price point.

5. AHF Products made its NFA debut as the new hardwood company that was pared from Armstrong after the AIP purchase. Longtime Armstronger Steve Staikos, who is no stranger to NFA, told members the game plan is for Bruce to be the umbrella brand, Armstrong products will eventually migrate to Hartco and will be exclusive to the specialty retailer, and Robbins will be the direct-to-the-customer brand. Brings back memories of Triangle Pacific.

So, what were members saying after the meeting? Who impressed them? A few companies bore mention, but the resounding winner was Cali. So many members cited the disrupting company spearheaded by Doug Jackson as the one that came to NFA with opportunity.

To that point, Mark Lewis, DeGraaf Interiors, Grand Rapids, Mich., told me Cali is “hitting it out of the park with some price points at 20-mil.” He cited GeoWood as a great product at a great price. But he believes the “big hitter” will be its entry point into the rigid core category geared toward builders. He believes at that price point it’s going to be a home run with the whole group.

Lauren Coles, Coles Fine Flooring, San Diego, among others, raved about Cali’s Meritage. “The colors are good, and the price is right.”

But Cali’s newest introduction, Cali Longboard, is what turned heads at this meeting. The LVP is 6 feet long and 9 inches wide and was merchandised encased in a surfboard to illustrate the size. Jeff Macco, Macco’s Flooring Center, Green Bay, Wis., said he loved the marketing approach. Ian Newton, Flooring 101, Ventura County, Calif., thought it was unique to have planks that long. Phil Koufidakis, Baker Bros., Phoenix, felt it offered some of the best colors on the market.

Other products that drew rave reviews were Mannington’s Loft, a parquet-look LVT. Newton called it “really unique, outside the box at a decent price point. When you get a unique product like that, it’s not so much about price point.”

Then there was USFloors’ tile collection, Karastan Wood, which will be launched later this year, and The Dixie Group’s new carpet. “Dixie always has the best carpet, price point, style, quality, across the board,” Coles said.

That’s the thing about the NFA—it’s the best of the best—product, people, places.

 

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My take: The Domotex USA post mortem

March 4/11, 2019: Volume 34, Issue 20

By Steven Feldman

 

I awoke on the morning of Feb. 28 to a torrential downpour. I took a peek out my downtown Atlanta hotel room window and watched as traffic began to build. It was the morning of Domotex USA’s much anticipated debut. Was this going to prove an ominous harbinger of things to come at the Georgia World Congress Center?

Two and a half days later, the jury was still out. Was Domotex USA a success? In a word, depends. Depends on the true expectations of show management. If expectations were that this would be a competitor to Surfaces, a show that would attract a throng of East Coast retailers, then Informa has nothing to worry about. If the goal was to connect manufacturers with manufacturers and manufacturers with distributors—that may be another story.

Many in this industry have been asking for my takeaways. Based on conversations I had with attendees and the exhibitors who gave the upstart show a shot, here’s what I gleaned…

1. The sentiment from exhibitors was the show was much too late. Domotex had no choice. Atlanta this year played host to the Super Bowl, rendering earlier dates impossible due to a scarcity of hotel accommodations. Next year’s show dates are Feb. 5-7, smack on the heels of Surfaces. Some told me they thought Domotex should have waited until 2020 to launch.

2. Basically every exhibitor told me they saw precious few retailers, and those they did see were local with maybe a scattering from Florida. Conversely, they were seeing small and mid-sized distributors and manufacturers. They called it a manufacturer networking show. It didn’t come as the greatest surprise given Domotex approached FCNews, the most influential publication for retailers, with a pittance of a budget compared to other shows that attempted to launch an East Coast event to promote to you—retailers. That didn’t inspire much confidence on our part. One manufacturer who requested anonymity said they brought more people to the show than retailers they saw.

3. I did see some high-profile retailers walking around. Floor & Décor had a contingent of about five people, and there was Jason McSwain, president of the National Floorcovering Alliance. Then again, Floor & Décor is based in nearby Smyrna, Ga.

4. Many manufacturers that passed on exhibiting chose to walk the show, taking the proverbial “wait-and-see” approach. Each and every one I spoke with told me attendance, or lack thereof, justified their decision—a decision that will not change for next year’s event.

5. On the other hand, most companies that did exhibit said they will return next year, believing they need to give Domotex USA a couple of years to prove its worth. And then there are companies like The Dixie Group, which will return because the Dalton-based company wants to support Georgia.

6. Many exhibitors said the impetus for exhibiting this year was their strong relationship with Domotex by virtue of its Germany and China events. Others cited the fact it is much less expensive than Surfaces. That’s why you saw some exhibitors in Atlanta that otherwise sneak suites or hold off-site events during Surfaces.

7. Everyone questioned Saturday hours. The unanimous sentiment was that two days are more than sufficient.

8. The center stage on the show floor was a good idea. The seminars/ presentations were easily accessible.

At the end of the day, the future of Domotex USA will rest on whether the industry determines the need for an East Coast trade show on the heels of Surfaces. Remember, many East Coast retailers will already have attended Surfaces, the Shaw and Mohawk regionals, Carpet One/Flooring America or some combination thereof before Domotex.

These shows are somewhat symbiotic: If the manufacturers come, retailers will follow. If retailers show up, manufacturers sign on. One doesn’t happen without the other. Or it doesn’t happen at all.