Posted on

Installation: Underlayments = solutions + add-on opportunities

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

By Megan Salzano

 

Sundry products such as underlayments and subfloor levelers are often overlooked by the consumer but play a vital role in the successful completion of any flooring installation. Furthermore, they also provide the retailer with upselling opportunities.

As such, it is squarely on the shoulders of the retail sales associate to convey the pivotal role these products play when it comes to the final outcome of a project. “The underlayment is a very important add-on sale,” said Jim Wink, vice president of sales and marketing, Foam Products. “It generates much greater profits with high margins over the low profit margins of the actual flooring.”

Current flooring trends have also made room for upselling opportunities. For example, as hard surface flooring has grown in popularity, the importance of underlayments has grown as well. “Many families who have been accustomed to the benefits of carpet with a separate cushion are now finding out their new hard surface floor isn’t as quiet as what they were used to,” said Erik Kempf, president, Leggett & Platt Flooring Products. “For consumers who are making the switch from soft surface to hard surface, the retailer should explain the reasons why a good quality underlayment is needed. Carpet has an obvious companion product, which provides a profit center. When you move to hard surface flooring, not only are you taking a customer out of the market for a longer period of time but oftentimes no underlayment is used. That is a tremendous profit opportunity for the retailer.”

In order to land that add-on sale, retail owners and their sales associates should first be well informed on the benefits underlayments provide and then relay those benefits to suit the needs of the customer. “It is always essential to assist customers in researching what best fits the needs of any particular installation,” said Wade Verble, vice president of business development – underlayment division, DriTac Flooring Products. “If sound control is the primary concern, the focus should be abatement qualities. If moisture control proves most important, research the moisture mitigation attributes of the underlayment.”

Adam Abell, market manager, tile and stone installation systems, consumer and construction business unit, Bostik, agrees retailers must embrace their role as industry experts. “Stay savvy and educate your customer with the proper techniques, the reasons why conformance with our industry requirements will result in longevity and quality of the completed project.”

However, offering underlayment is not only about making a sale. It can also help add value to a retailer’s customer relationships. “When retailers use underlayments to address subfloor issues, they then become a solution provider—not just a salesperson,” said Shane Jenkins, senior technical coordinator, Schönox, HPS North America. “This is the greatest opportunity for retailers to gain the trust of the consumer as an expert. This added trust can lead to a successful sale without lowering the cost or compromising on the quality of the project.”

For some sales associates, adding underlayments to the final cost can be daunting. However, manufacturers agreed, oftentimes the opportunity to upgrade the customer with an underlayment sale naturally presents itself. “In many situations there is an obvious need for a solution, and just pointing out that there are underlayments that offer a remedy is a path to a better installation for the customer and higher profits for the dealer,” said Ann Wicander, president, We Cork. “So often the dealer rep is afraid to add more cost to a project estimate—they miss the opportunity to upgrade the customer to a better situation.”

Other industry experts agree. Jack Boesch, director of marketing, MP Global, said adding a premium acoustic underlayment is as easy as a fast food restaurant asking if you want to “super-size” your drink. “Consumers look for guidance from sales staff on what to purchase. When the customer service rep explains the benefits of a premium underlayment, the additional cost doesn’t seem unreasonable.”

Manufacturers, likewise, agree that profitable opportunities in today’s market should never be overlooked or underutilized. “There are financial benefits to promoting and upgrading your customer,” Bostik’s Abell said. “If you omit this discussion with said customer you are leaving an opportunity untapped and, in today’s marketplace, your savvy competitors won’t likely pass on similar opportunities they encounter.”

When it comes to merchandising techniques, Leggett & Platt’s Kempf said countertop, point-of-purchase units used at key locations in showrooms are useful. They not only showcase the underlayment but they can also illustrate the key reasons why underlayments are used, he said. “The one mistake some make is having too many choices. There are so many flooring options that consumers may get frustrated. Don’t over complicate the underlayment pitch. Keep it simple.”

In the end, establishing your brand as one of quality installation and service is critical in today’s marketplace, and underlayments can help accomplish this. “If retailers begin with a solid foundation, then finished flooring will look and perform as intended,” Schönox’s Jenkins said. “The end goal is to have a completed project all parties can all be proud of, and that starts with a sound and smooth subfloor.”

Posted on

Laminate: Latest looks aim to excite today’s consumers

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

By Reginald Tucker

 

In the battle to regain market share lost to red-hot categories such as LVT, WPC and SPC, laminate flooring suppliers have raised the ante in terms of performance—particularly the product’s water- and dent-resistant attributes. But they are also seeking to generate attention—and, by extension, more real estate on the showroom floor—by kicking things up a notch or two in the aesthetics department.

To that end, laminate manufacturers are leveraging various technologies, innovation and some creativity to get retailers excited about the category again. “Laminate designs over the last couple of years have really evolved from what we’ve seen in years past,” said Adam Ward, senior director of wood and laminate, Mohawk. “The level of realism you can get in a laminate product still beats what you can get in other categories such as ceramic, LVT and rigid core products.”

In Mohawk’s case, that realism is primarily due to the decorative papers used to render the primary image, plus an innovative four-color process employed to bring the visuals to life. These technologies have paid big dividends for Mohawk, whose RevWood line earned the company top honors in the laminate category in the 2019 Award of Excellence competition. “The level of pressing detail and registered embossed combined with our in-house design really takes design to another level, and it’s why we positioned the category as RevWood over laminate,” Ward explained. “The things we can do from a visual perspective—combined with our waterproof story—really has elevated the category over some of those other imitations that have come into the market.”

Examples include the Antique Craft collection, a 9 1⁄2-inch wide x 7-foot-long plank that plays on the growth of wider/longer in the wood category. According to Mohawk, it features ultra-realistic design and texture combined with bevels that mimic the texture of a real wood floor. Then there’s Collosia, a collection that resides within Mohawk’s Quick-Step brand. In keeping with its name, the product boasts 80-inch-long x 10- inch-wide boards available in modern urban looks in a variety of fashion-forward colors. “What we’ve been able to do with these products is bring retailers back to the category,” Ward said.

Mohawk is not alone. Inhaus, which also earned an Award of Excellence for its laminate offerings, believes the category still has a lot to offer retailers and, ultimately, consumers. “Laminate is one of the flooring categories with the lowest cost complemented with leading scratch and wear resistance,” said Derek Welbourn, CEO of Inhaus. “Furthermore, working with clarity of pressed melamine and digital printing there are design abilities that other categories don’t have. Our goal is to match these technical qualities with great designs complemented by the ability to bring these designs to the market with greater speed to offer our customers something that other categories cannot.”

To that end, Inhaus has invested in its own design center, a 40,000-square-foot facility that includes a workshop for raw materials, manned by 22-member team that works continuously on design. “This helps us create new products at a faster rate and respond to trends in the market as quickly as possible,” Welbourn added.

Major suppliers continue to dedicate resources to give themselves an advantage through innovation and differentiation. “Our styling team is able to take real wood and enhance it through advanced scanning and digital manipulation to get the exact look they want,” said Dan Natkin, vice president, hardwood and laminate, Mannington. “Also, with the newer technologies in printing, we can also create a broader array of visuals with less repeats.”

As an example, Natkin cited Arcadia and Sawmill Hickory, top-selling offerings from Mannington’s award-winning Restoration collection.

CFL Flooring, another innovator in the laminate sector—among other categories—has also made great strides in developing eye-catching looks. Utilizing its vast experience in hard surface flooring production, as well as its manufacturing scale, the company is able to leverage those attributes to its advantage. “We have a broad range of fashion-forward design visuals available in varying lengths or random widths across many species, including handscraped or embossed-in-register real wood surface structure,” said Barron Frith, CEO of CFL’s U.S. operations. “Our biggest advantage is the number of unique visuals we offer, making it very realistic and hard to see repeats once the floor is installed, which technically is more difficult to achieve.”

For CFL, staying on the forefront of innovation is the name of the game, according to Frith. “We continue on the path we started in 2014, when we were the first to launch water-resistant laminate and solely focus on water-resistant solutions with special sizes—herringbone, blended lengths and widths, etc.—as well as special designs that require a significant amount of pattern variation.”

Seemingly across the board, suppliers are leveraging technology to develop realistic patterns and visuals. “High-resolution printing advancements are opening up the opportunity to produce unique, one-of-a-kind looks,” said John Hammel, director of category management, hardwood and laminate, Shaw Floors. “Consumers can now choose from laminate with grouted tile, realistic wood plank and stone visuals, giving them a durable, low-maintenance product with high style.”

A winning proposition
The latest innovations we’re seeing in laminate are designed to do much more than dazzle consumers. The main objective is to keep the category relevant in the face of increasingly stiff competition. “Laminate still has many advantages over other categories like resilient or wood, such as its scratch resistance and strength,” CFL’s Frith said. “Warranties are very similar with waterproof products as well. Bathrooms, three-season rooms, spills or large-area installation without T-moldings are all warranted, so we believe these types of products still have a bright future ahead.”

Mannington’s Natkin agreed, adding, “Laminate is already the most scratch- and indentation-resistant printed product category on the market today. It is also visually more realistic than LVT; it lacks that plastic look.”

It’s a message that laminate suppliers are hoping will resonate deeply with retail sales associates—those on the front lines with consumers. “The com- bination of leading design, wear performance and cost create a value proposition for laminate that is very powerful,” Inhaus’ Welbourn stated. “Other categories will have problems competing with this.”

At the end of the day, it’s all about providing trade-up opportunities for retailers. As Mohawk’s Ward explains: “With RevWood Plus and our other RevWood products, we are giving consumers and specialty retailers a reason to turn back to the category where they may have traded down consumers in years past—particularly with the millennial and younger customers who might not necessarily require a hardwood or demand it. This has given retailers a reason to trade up from a cheaper laminate that they may have looked at in the past.”

All this, plus laminate’s proven value proposition and high-performance attributes, will go a long way in helping the category recoup market share, suppliers say. “Today’s consumers are looking for affordable laminate flooring, but with higher quality, style and design than the laminate of the past,” Shaw’s Hammel stated. “The trend toward thicker products, combined with improved high-end visuals and realistic embossing, means laminate isn’t simply an entry-level product.”

Posted on

Dealers continue to see value in Mohawk’s Omnify program

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

By Lindsay Baillie

 

Almost three years ago Mohawk launched Omnify, an omni-channel solution that aims to simplify digital marketing by capturing and tracking leads while also streamlining social media publishing and search engine marketing. Today, Omnify works in conjunction with many of Mohawk’s other initiatives including its revamped Five Star program as well as Edge, its new go-to-market strategy.

Many Mohawk dealers adopted Omnify when the manufacturer unveiled the program at Solutions in 2016. Rahim Daya, principal and general manager, The Westvalley Flooring, Alberta, Canada, became a believer only five minutes into FloorForce’s chief innovation officer John Weller’s Omnify presentation. “We were the first company in our market/region to sign up for Omnify,” Daya explained. “I have been hands on with my company’s digital presence right from day one, realizing the importance of Internet marketing. After a careful review of optimization options available in my region and speaking to John, I decided to work with Omnify.”

For Daya, Omnify truly does simplify digital marketing. “Mohawk has done an excellent job of realizing that store owners are not online marketing executives,” he said. “With Omnify, you have the expertise of people who know and understand the flooring business working with you to deliver tangible results. The program has allowed me to benefit from the Internet while being able to focus on what my company does best—sell flooring.”

For Daya’s business, Omnify provides the latest, up-to-date graphics and interface that aligns with the consumer’s ethos—a major selling point. Through Omnify the consumer is led through the digital pipeline to Daya’s front door. “[Omnify] is vested in ensuring state-of-the-art marketing is employed on a dealer’s behalf,” he explained.

Tom Heffner, president, About All Floors with locations in Birdsboro and Wyomissing, Pa., has also seen the value in using the omni-channel program. “We’ve been using Omnify since its inception,” Heffner explained. “I’ve had lots of sales reps come in and offer me digital advertising programs, but they’ve all been expensive and haven’t worked. With Omnify you are partnered with Mohawk to drive your brand in the local market while tying it to the world’s largest flooring manufacturer. There is an interest in it working for both my company and Mohawk, and they’ve committed the resources and people to make it work.”

Paula Anselone, owner, Anselone Flooring, Mansfield, Mass., signed on for Omnify in November 2018 and has already seen a difference. “We have noticed a significant increase in online leads and have found it helps our customers with a more fluid shopping experience,” she said. “I would definitely recommend Omnify to other flooring dealers, especially if they use FloorForce web hosting. It’s a no-brainer.”

While flooring dealers have a host of options when choosing digital marketing programs, many believe Mohawk’s Omnify provides greater value. “Digital marketing programs that are not segmented specifically towards flooring do not offer the same level of value as Omnify,” Daya told FCNews. “Mohawk and its senior management team understand the process and are extremely value driven in this area. A combination of flooring expertise and a sound understanding of digital applications make this the best valued program in the market based on my experience.”

Posted on

Technology: Top 10 tips for choosing the right software

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

By Lindsay Baillie

 

Selecting the ideal software for a flooring business should not be done in haste. That is according to several software manufacturers that urge dealers to take their time getting to know and understand the ins and outs of each system.

New software—whether it is a store’s first system or simply taking the place of an existing program—often requires a dealer to invest time and money before it is running at maximum efficiency. In addition, employees must be more open to adapting to the new business/measuring/inventory system, which can greatly affect the success of the software.

Following are 10 things to consider before leaping into a new software purchase.

Evaluate your business cycle. When considering new software, experts say it is important to know the current status of your business cycle and where the company needs to be to increase revenue and reduce operational costs. The right software should reduce or eliminate errors, minimize repetitive actions and lower operational expenses.

“If your business involves too many manual processes, your bottom line is affected,” said Edgar Aya, president, Comp-U-Floor. “Every time a mistake is made it affects your overall profit, reduces your selling time and directly impacts your overall business health. This is where the right software can make a huge impact on your profitability.”

Define your objectives. Before looking for software, dealers should create a list of what they want the program to achieve. For example, does a dealer want stock inventory? How important is inventory control? Does the dealer want to focus on automating paperwork and bookkeeping?

“Many people include every feature and function they ever heard about in their wish list of things they want the software to do,” said Joseph Flannick, president, American Business Software (ABS). He reminds dealers that all their software does not necessarily have to come from one vendor.

The main objective, he said, is to be realistic. “Think more along the lines of ‘must have’ vs. ‘nice to have.’ The larger the budget, the more things you can include in the ‘must-have’ category.”

Weigh the benefits of industry specific vs. generic. Software manufacturers say this choice depends on multiple factors, including the size of the company and the goals of the business, among other consideration. RFMS advises flooring dealers to look into flooring- specific software before investing in a generic program.

“Because of the uniqueness of the flooring industry—think about roll goods and inventory control or measure/estimating projects—most of the time industry-specific software is the best choice,” said Rod Bayless, director of sales and marketing.

Industry-specific software can also help eliminate errors prior to installation. Some experts believe measuring software should provide the installer with a clear drawing as well as all the information he or she needs for the project. “It should have a printout indicating where the flooring needs to be installed with all seams showing,” said Dennis Benton, president, NivBen. “It should also have a fill-cut sheet displaying the fills and their sizes. This will help the installers proceed with the project with ease.”

Choosing between cloud-hosted vs. cloud-based. Beyond comparing industry- specific programs with generic software, dealers should also look into the differences between cloud-hosted and cloud-based software.

“There are many companies that offer services for low monthly fees that are cloud-hosted,” Comp-U-Floors’ Aya explained. “This often means the older desktop technology was moved to a server, so it is easier for a provider to push out updates to all of its users at one time and allows for easy management of the older technology. This dated technology will not help you grow to meet customer demand.”

By comparison, cloud-based technology is fairly new to the flooring industry and often requires an upfront investment—namely time. As Aya explains: “It is written in the latest advanced code, is responsive to your devices anywhere and anytime, has links to other internal components within the software and allows using the Google Calendar Interface for installer or service scheduling.”

Look for an easy-to-use program. Software is designed to automate operations and maximize efficiency. To fulfill both those requirements, observers say, software must be easy to use for all users.

“If only one or two people in your company know how to use the software, it obviously limits the level of impact you will see,” said Chad Ogden, CEO and president, QFloors. “Look for user-friendly software that everyone in your company can learn—even those who are not particularly tech savvy. A good way to evaluate ease of use is to count how many different screens and clicks are required to perform a certain function.”

Look for integrated software. To remain relevant and profitable in today’s rapidly evolving flooring industry, using available digital technology combined with industry-specific software is key. This means taking the time needed to find the best fit so that you can benefit from the efficiencies, analytics and performance improvement available.

“Dealers should invest in a system with integrated accounting that seamlessly pairs their flooring-specific processes—such as job cost, inventory value, purchasing and other business reporting—in real time, and then flows easily to a system’s analytic platform to deliver critical business data in a readily comprehensible visualization format,” said Kelly Oechslin, marketing coordinator, RollMaster.”

Using an integrated soft- ware program also makes per- forming various tasks on a job site easier and can reduce human error, experts say. “The easier your measure solution is integrated with your business management the better,” said Steven Wang, president, Measure Square. “That way you don’t have double entry or need to switch to other software.”

Schedule system demos.After learning about a software’s benefits, bells and whistles, it is important to schedule an in-depth demo with team members from every department of your company. “Since each department will have needs that are specific to their area of the business, it might be best to set up a series of shorter demos with each department,” Bob Noe Jr., president, Pacific Solutions, explained. “Remember, if you have buy-in from the majority of your staff, the adoption of the software will be a much smoother process.”

Ask about tech support. Beyond a software’s features and benefits, dealers should also look into the quality of support available from each software company. This includes any resources available to help bring the staff up to speed as well as technical and training support.

“Training and technical support, if not included with your purchase, can sometimes be unanticipated ‘gotcha’ costs,” QFloors’ Ogden warns. “Before purchasing software, ask a lot of questions about the options and costs for training, conversion and ongoing support. Also, find out what your technical support will look like. For instance, after your purchase, can you call and talk with a live person if you have a question?”

Request referrals. Don’t just take the vendor’s word on it. Before choosing a software system it is important for a dealer to speak with other businesses that have used it. The key, according to Pacific Solutions’ Noe, is to find dealers of similar size and scope.

While speaking with those referrals, experts also suggest dealers ask about their experiences with the software company’s technical support and training staff.

Choose a system that evolves over time. A great software program will grow alongside a dealer’s business, experts say. To this point, it is important for dealers to evaluate where they want their business to go in the future and then select a system accordingly.

Posted on

Installation: Välinge pushes innovation with latest offerings

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

By Ken Ryan

 

With more than 2,600 patents to its credit and another 5,300 in the pipeline, Välinge Innovation AB continues to burnish its credentials as an R&D company par excellence.

“Innovation is in our DNA,” Lennart Thålin, region manager - North and South America, told FCNews. “Lately we’ve launched a few more groundbreaking innovations.”

Whether it’s the company’s legacy 5G locking system or a new innovation like wood powder technology, Välinge’s objective is to push through any barriers and deliver technological solutions to the market. In many instances, it requires a new way of thinking, Thålin said. Case in point is the company’s wood powder technology—a production and material innovation in which Välinge uses a mix of wood powder that comes from recycled laminate flooring, melamine, aluminum oxide and pigment. “With this powder mix we create two types of flooring: ceramic composite featuring the Nadura surface and hardened wood featuring Woodura surface,” Thålin said. “The former has a ceramic look and feel, and the latter features a wear layer of real wood which is infused with the powder mix and thereby increases the hardness and impact resistance three times compared to the original species.”

According to Thålin, ceramic composite flooring is harder and more scratch resistant compared to normal ceramic or porcelain tiles, but still feels warm and comfortable to walk on due to the wood fiber content. “It also withstands impacts much better and can be installed as a floating floor using our 2G/5G locking system.”

The wood powder technology uses a thinner wood wear layer (0.6mm) that enables production of wider planks at an affordable cost. “You get an automated filling of knots and cracks in the process thanks to the penetration of the powder when heated and compressed in the production cycle,” Thålin explained. “It also withstands impacts much better than similar flooring and can be installed as a floating floor using our 2G/5G locking system.”

Välinge plans to license the wood powder technology as well as set up its own production of flooring.

Liteback
In recent years Välinge has stepped up its introduction of market innovations, especially as the resilient flooring segment has soared on the strength of LVT, WPC and SPC offerings. The sheer weight of these types of flooring can prove challenging for installers. To remedy this, Välinge created a technology and process called Liteback to remove some of the material from the back without affecting the properties of the floor. By removing material, users can achieve a weight reduction of 15%-20%. As a result, all handling of the product becomes easier and more efficient—from delivery out of the production unit to the time of the purchase and during installation. In addition, the removed material can be recycled, and new flooring can be produced.

How it works: by using a grooving unit, groovers are milled on the backside of the floorboard. The material that is removed in the process is recycled back into the production process, thereby reducing material consumption by up to 20%. Terry Barbree, global director of sourcing, hard surfaces, Shaw Industries, said the company has been using the Välinge locking system for many years. “We appreciate the great technical support and the new features Välinge has brought to the flooring industry. We’re excited to see where the newest innovations like Liteback and powder technology will evolve.”

5G
5G is the well-known Välinge brand for the globally recognized fold-down installation system used by more than 100 flooring companies around the world. The unique feature about this technology is the flexible tongue that enables a much easier and faster installation process. “We have fine-tuned the 5G system so it also works with thin materials (down to 4mm) such as LVT and SPC by using an alternative version of the plastic locking tongue—stepnose—that also makes the installation easier and the locking stronger,” Thålin said.

Anett Nemeth, deputy CEO at Graboplast, a Győr, Hungary-based vinyl flooring manufacturer agreed that the 5G system facilitates and significantly shortens the time of installation, adding, “The prefabricated wood floor with shock absorbing underlay together with 5G fold-down installation system is a perfect match. Our customers like it very much.”

Posted on

I4F broadens its scope to cover rigid core platforms

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

By Reginald Tucker

 

Early glueless locking systems mostly targeted laminate and hardwood flooring categories. But with the rising popularity of rigid core platforms, developers of these systems are expanding their portfolio of technologies to offer licensees and manufacturing partners even more options.

To that end, I4F has announced new partner- ship agreements with rigid core flooring manufacturers CFL Flooring and KingdomFlooring.

In the case of CFL, the patent partnership agreement pertains to a new engineered stone, wood veneer composite base flooring board. The breakthrough magnesium oxide, veneer board addresses the disadvantages currently associated with natural wood flooring by reducing moisture intake and flammability on any floor level or room type. The new sound-absorbing board provides a stone-wood composite base that keeps the wood veneer level dry and heat resistant by substantially retaining moisture and heat with-in the stone-wood base.

“We are excited about working with I4F to promote this breakthrough technology,” said Thomas Baert, president, CFL. “This technology, developed by Mondo Pallon, is the beginning of many more to come over the next months and years.”

John Rietveldt, I4F CEO, was equally enthusiastic about the partnership. “This latest partnership with CFL underscores our strategy to seek out and market flooring technologies that have a profound impact on today’s flooring landscape.”

As part of I4F’s recent partnership agreement with KingdomFlooring, I4F receives exclusive sub-licensing rights for KingdomFlooring’s new patented polymer core floor panels enhanced with grout features. The new panels enable aesthetically pleasing, visible joints by introducing a grout-shaped recess close to the surface of the panel on at least one of its edges.

“This new partnership agreement takes our cooperation with KingdomFlooring to the next level and further supports our strategy to partner with innovation-focused manufacturers,” Rietveldt added.

Davord Dai, chairman of KingdomFlooring, echoed those sentiments. “We are excited about the prospect of working with an expert in the field to promote this new design-enhancing floor panel.”

Cost-saving innovations
Beyond innovative locking technologies, I4F is offering a patented technology enabling manufacturers to save up to 10% on materials during the production of rigid polymer boards. The technology also enhances productivity by optimizing the extrusion process during the production of rigid polymer boards, including SPC and expanded polymer core (EPC) panels.

“Sustainable material savings are good for the industry and our planet,” Rietveldt noted. “Manufacturers can now benefit from increased productivity gains during the production of rigid boards and have the opportunity to make significant savings on material costs.”

All this dovetails nicely with I4F’s Patent Cluster Concept (PCC), enabling partners to pick and choose the platform they require. More importantly, PCC also provides full transparency on the composition of license fees to obtain the best return on investment while avoiding unnecessary payments for unused patents.

Clustered patents represented by I4F cover the following:

•Locking

•Surface finishing

•Materials and panel composition

•Manufacturing processes

•Board/wall panels

I4F’s PCC means manufacturers can select the intellectual property that best suits their business needs. Additionally, they can regularly evaluate which cluster provides them with optimal patent protection.

“We will continue to work in partnership with the world’s leading and most innovative companies to find more exciting innovations that truly make a difference,” Rietveldt noted.

Posted on

Area rug: State of the industry—Rise of e-commerce, pricing pressures constrain growth

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

By Ken Ryan

 

If you are just returning from a five-year sabbatical from the flooring industry you might not recognize the area rug business circa 2019.

Dwindling are the days when the average specialty flooring retailer devoted racks of handmade, high-end Persian and Oriental rugs for discerning customers. E-commerce has changed the way consumers shop for rugs, and as a result the market has become more fragmented with price points being increasingly compressed.

This is not to suggest the area rug business isn’t adapting in the face of these challenges. Industry observers say manufacturers and specialty dealers have responded by marketing custom-created rugs to keep pace with all the changes. The challenge for today’s specialty dealer is the sheer number of places a consumer can find a commodity rug—furniture stores, general merchants, home centers, the local convenience store and, of course, the web. “In the last five years, e-commerce has been the biggest disrupter of the rug industry,” said Bart Hill, senior vice president product development and operations, Mohawk Home. “Then there has been retail consolidation, mainly larger chains. We used to do a lot with Sears and Kmart. We are losing a retailer a year, which is significant. Then there is the continued influx of machine-made rugs sourced primarily from Turkey which has driven down price points.”

From a percentage standpoint rugs are essentially flat in 2019 year-to-date vs. the corresponding period in 2018, research shows. The category is outperforming carpet in the residential segment on a percentage basis on the strength of hard surfaces, which has led to add-on sales for rugs.

Flooring executives said 2019 started out OK for rugs before hitting a soft spot in the second quarter. Unit demand is still faring well, but deflationary pressures have hurt average selling prices. “The Internet has changed the rug business and made it super competitive,” said Jared Coffin, vice president of product management for The Dixie Group (TDG).

TDG is a good example of what many mills are doing in today’s landscape. Although not a typical rug company, all three Dixie Group brands (Masland, Fabrica and, to a lesser extent, Dixie Home) sell custom-made rugs. The growth category for TDG has been fabricating off its broadloom collection where it can customize, say, a 9 x 11 1⁄2-foot rug to fit the approximate size of a customer’s room. “That business is up 10%-15%,” Coffin told FCNews.

Similarly, Anderson Tuftex markets the fact it can take any A/T carpet style and turn it into a rug that will complement any room in a consumer’s home. Customers can choose from a standard rug size or customize it to fit their specific needs, the company said.

Online sales make their mark
What has influenced the rug market the most is the role of e-commerce. With sites like Wayfair and Amazon offering 5 x 8 rugs for as little as $59–$79 compared to $299–$399 a few years ago—flooring stores cannot compete. “The top 80% of the business is $199 or below for e-com,” said Blake Dennard, senior vice president, Kaleen Rugs & Broadloom. “Smart brick-and-mortar dealers are not selling that [commodity] rug, they’re going after the better-end goods—the handmade, wool offerings. If you are going to take up space in your store you only have so many display arms to show your rugs; in that case, it’s better to move those higher-end goods to help compensate for the price erosion.”

Dennard said the days of walking into a carpet store and seeing 5 x 8 racks with 40 rugs in each display is pretty much over. “Those racks have come down. Retailers are instead doing sample programs and fabricating rugs out of their broadloom. That market has completely changed in the last five years.”

As the rug business shifts, dealers are offering private-label programs or selling higher-end goods. Cherry Hill, N.J.-based Avalon Flooring, with 14 stores in three Mid-Atlantic states, sees both good and bad forces influencing the rug market today. “The ‘bad’ is the race to the bottom on price points,” said Gerry Yost, director – area rugs and window treatments. “The ‘good’ is more customers are coming to retailers like ours because they bought a bargain rug and now would like something better, and they need help choosing a rug that will complement their décor.”

O’Krent’s Abbey Flooring in San Antonio has been selling rugs for more than 100 years. However, business has become more difficult over the last handful of years given the explosion of online retailers, according to company executives. “In order to deal with this consumer change, we have in turn focused increased efforts on custom rugs made from broadloom carpet in order to maintain margin and retain our hard surface customer’s rug business,” said Margie O’Krent, rug buyer. “In doing so, we have been able to keep our area rug sales volume flat in a year over year comparison.”

Mills are actually seeing greater demand for rugs these days because of the growth of the e-commerce model and the move toward custom-cut rugs. “We are shipping more units in the opening price points, primarily driven by online growth,” said Gerard O’Keefe, vice president of sales, Nourison. “We have gone to a seven-day work week in our main distribution center to accommodate demand and are in the process of adding more distribution capacity. Meanwhile, the emergence of large national players in online retail and an overcapacity in supply chains, combined with changing consumer buying habits toward rugs have led to an erosion of price points. This, along with the inevitable return [on investment] requirements, puts operational pressure on all companies to get to a particular sales number.”

Focus on differentiation
As custom programs proliferate, mills are trying to differentiate their offerings with larger rug sizes and extra wide-width broadloom combinations. “Programs like our 50 to Infinity come into play as really viable solutions for the brick and mortar players,” O’Keefe said. “It provides a great opportunity to offer something that differentiates them and keeps them out of the fray of competing with e-commerce.”

Mohawk and its Karastan brand aim to differentiate their products through unique fiber extrusion abilities as well as rug fabrication with an emphasis on 10- and 12-foot cuts. “We control our own destiny with our raw materials supply,” Hill explained. “For us it’s about adding textures—providing that value equation. We have to be innovative on the front end. We are a fashion business where color, design and texture are still very important.”

Mohawk believes it has the added advantage of doing most of its manufacturing (80%) in the U.S., which is increasingly important in this age of tariffs against U.S. trading partners. “We still see signs of life for rugs,” Hill added. “We’re seeing pent-up demand in the home furnishings category that has been soft, and we expect a pickup in the second half of 2019. Overall, we are bullish on the category even though there are still issues with global economic factors.”

Posted on

New York area flooring contractors pay it forward

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

By Reginald Tucker

 

New York City—Several New York-based high school seniors, along with a respected member of the local flooring industry, were recognized earlier this month during the 35th Annual Francis J.P. McHale Scholarship Awards luncheon.

As in years past, the 2019 scholarship awards were presented to a pair of students whose parents are affiliated with the New York City District Council of Carpenters (Local 2287), along with two seniors whose parents are non-union employees of contractor members. The awards program was named after a former business manager of Local 2287 who became treasurer of the Carpenters’ Union in the 1980s.

“Over the past 35 years we have supported the college education of 95 students, issuing more than $1.2 million in scholarships to very deserving young men and women,” said David Meberg, who serves as both trustee-chairman of the Greater New York Floor Coverers Industry Promotional Fund—which oversees the scholarship program—and president and CEO of Consolidated Carpet, a prominent New York-based contractor.

And the 2019 Francis J.P. McHale scholarship recipients are:

Thomas Waldron, whose father, Bernard “Bernie” Waldron, works with Classic Carpet Showroom. Waldron is a senior at Holy Cross High School in Flushing, N.Y. He plans to attend St. John’s University in the fall and will study finance. Waldron is a member of the Holy Cross Varsity golf team and captain of the varsity hockey team. He also plays on local teams such as the Long Island Ice Caps, Long Island Sharks and the Long Island Jaws. Waldron received the Michael J. Pergolizzi Scholarship and is a member of the National Honor Society. After college he plans to attend law school, with the goal of becoming a corporate lawyer.

Luke Goehring, whose father is Scott Goehring, Pyramid Floor Covering, is a student at John H. Glenn High School in Elwood, N.Y. He will be attending SUNY Maritime College in the fall of 2019, where plans to further his education and earn a degree in Mechanical Engineering. Watching his father repair items in his garage sparked his interest in building and design. In high school, Goehring was involved in many shop classes and robotic clubs. Other interests include exploring the outdoors. In fact, he earned the rank of Eagle Scout and is a member of the Order of the Arrow, a national honor camper society. Goehring is also a member of the National Honor Society and participates in Science Olympiad, Science Research Club and Technology Club. “Luke has an interest in solving problems, particularly ways to increase productivity through modification of the task at hand,” Meberg told attendees. “As contractors, we could really use your skills.”

Luke Sacco, son of David Sacco of Pyramid Floor Covering, is a senior at Syosset High School who plans to study finance at Marist College in the fall. In his spare time, Sacco serves his community using his skills to teach and coach local Syosset youth in lacrosse. He’s also involved in many activities in his school, including JV lacrosse (he’s team captain), school store, Substance-Free Alliance and the JV football and indoor track and field. Sacco is also a member of the Italian International Honor Society as well as the National Honor Society. His ultimate goal is to start his own business.

Stacey Kappel, daughter of Ray Kappel of Consolidated Carpet, is a senior at Bethpage High School. In the fall she plans to attend Hofstra, where she will work toward a degree in biomechanical engineering. Kappel—the second in her family to receive the J.P. McHale Scholarship—has received a number of honors and recognitions, including national merit scholarship finalist. Like Sacco, she is also a member of the National Honor Society as well as the National Italian Honor Society. She was chosen for a composite engineering program and participated in the All County Art Exhibition. Kappel also received the George Washington University Award for Excellence in Math and was recently named valedictorian of Bethpage High School.

Honoring service
In addition to the student college scholarships, the Greater New York Floor Coverers Industry Promotional Fund named Christopher Capobianco this year’s J.P. McHale Scholarship Award Honoree. Currently business development manager with Spartan Surfaces, Capobianco has been involved in the flooring industry in many different capacities over the past 40-plus years.

The Capobianco name has a long legacy and history in the flooring industry. In 1932 Christopher’s great grandfather opened what is now Glen Floors in Glen Cove, Long Island. Many of his family members are still on the retail side of the business, and several family members are on the manufacturing side.

For 34 of the last 41 years, Capobianco has worked in sales. For seven years he worked as a technical consultant after owning his own sales and technical consulting company. In 2012 he joined forces with Spartan Surface and helped open a New York City office for the firm—a move that represented Spartan’s first expansion beyond the Washington, D.C./Philadelphia market. In his current role, Capobianco works with architects, end users and flooring contractors in the New York City metropolitan area as well as Connecticut. He is also a part-time journalist for a number of different industry trade magazines, and he is also involved in volunteer work within the industry. In the 1980s he spearheaded an industry effort to establish a training school on Long Island, where he became a resilient flooring instructor.

For 25 years running Capobianco has been a member of the ASTM resilient flooring committee and has helped write many standards. He also served 12 years on the FCICA board—six as chairman—and he has been with the IICRC for 12 years. While there, he helped develop the resilient flooring inspector certification program. Capobianco also worked with Habitat for Humanity, securing donated floor covering and volunteer installers for several homes on Long Island.

“I’ve known Chris for as long as I care to remember,” Meberg recalled. “He has always been a passionate supporter of everything in our association as well as the installation community. It’s an honor to present Chris with this award.”

Capobianco accepted the honor with his signature grace and humility, citing those who earned the award before him. “I’m very humbled that the trustees chose to put me in some very good company,” he said. “Thank you all.”

Capobianco also acknowledged the student recipients as well as the Greater New York Floor Coverers Association. “To the scholarship winners—you are the main event here today. I hope this scholarship helps you on your way to a great future. As for the association—this organization has done such good work for the industry here in New York and the metro area. When any of you were awarded a job on a product I’ve specified, I never had to worry about it; it’s going to get installed properly, and the workers are going to be taken care of.”

Posted on

Gilford-Johnson taps Schollmeyer as president

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

By Ken Ryan

 

Veteran flooring executive Bill Schollmeyer is returning to his distribution roots as president of Gilford-Johnson Flooring, a top 20 wholesaler based in Jeffersonville, Ind.

Schollmeyer most recently worked with Johnson Premium Hardwood Flooring, where he spent 12 years, including the last eight as its CEO. “I’m psyched and really looking forward to the challenge,” Schollmeyer told FCNews. He will report to Jonathan Blue, who will remain executive chairman of the company. Blue served as acting president following the retirement of Dennis Cook, the long-term Gilford-Johnson executive.

Before Johnson Hardwood, Schollmeyer spent eight years with Hoboken Floors, rising to the level of vice president of product management for what was then the industry’s largest distributor with annual revenue of $500 million. Schollmeyer left Hoboken in 2006, a year before it abruptly closed under a mountain of debt.

Schollmeyer’s areas of responsibility at Gilford- Johnson include leading all of the company’s functions as well as overseeing its strategic direction. “Landing someone with the caliber of a Bill Schollmeyer is a home run for our organization,” Blue said. “We are now positioned for growth under Bill’s leadership.”

In a related move, Gilford-Johnson announced an undisclosed equity investment from Johnson Premium Hardwood. As part of the deal, Johnson products will be exclusively distributed by G-J throughout its markets in the Midwest and Southeastern U.S. Products designed for the national market will also be developed, marketed and sold through this collaborative effort. “We are extremely excited to forge this strong partnership with Gilford-Johnson and support Bill in his new role,” said Danny Chen, chairman of Johnson Hardwood.

These moves are meant to solidify the transformational partnership between Gilford-Johnson, the Ku family and Johnson Hardwood. “We’re excited about our new relationship and we’re confident that the combined strengths of both companies will make our products and services even more valuable to our customer base, Schollmeyer said. “Gilford-Johnson is ever more dedicated to being the best distributor in the country—both for our customers, as well as for our supply partners.”

Posted on

Retail roundup: First-half activity picks up steam post slow ’19 start

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

By Ken Ryan

 

Flooring retailers had to wade through some choppy waters in the midst of a first half marked by extreme weather conditions, 25% tariffs on Chinese imports and threats of tariffs on Mexico. And yet, despite unpredictable swings in business from month to month, several dealers reported surprisingly strong results.

“If I had to come up with one word to describe the first half of 2019, it would be enigmatic,” said Steve Weisberg, president of Crest Flooring, Allentown, Pa.

His sentiment was shared by Tim McSherry, president of Carpet Gallery Floors, Hagerstown, Md., who observed, “It has been an up-and-down year. Traffic would be busy one month and slow the next.”

John Taylor, owner of Taylor Carpet One Floor & Home, Fort Myers, Fla., added: “We’ve had periods in the first six months that were down drastically and ones that were up drastically. It seems to take the consumer longer to make the purchase decision, which affects everything.”

The majority of dealers polled by FCNews rated their first half as equal to or better than the same period a year ago. Some were quite stunned with the results. Cathy Buchanan, owner of Independent Carpet One Floor & Home, Westland, Mich., had concerns after GM announced the closing of four automotive plants in Michigan and letting thousands of employees go. “I thought it was going to affect our numbers for the first half of 2019,” she said. “On the contrary, we are having a stellar first half—up 12.52%— and I owe it to advertising both traditionally and digitally.”

Independent Carpet One is not alone in registering double-digit increases. Business at both of Craig Phillips’ Ohio locations (Barrington Carpet & Flooring Design and Carpet Country) are up low double digits year over year despite being in a state that was also impacted by the GM closings.

The degree to which the first half was characterized by strength, stability and growth surprised Kevin Frazier, owner of Frazier’s Carpet One Floor & Home, Knoxville, Tenn. “I was anticipating the first half would give our company small growth; instead, we have experienced 9% growth. I was anticipating 2019 would be a fine year, but it has to this point been one of our two best ever in 66 years.”

Even in sections of the Midwest hard hit by the cold and snow this past winter, business activity proved resolute. Case in point is DeGraaf Interiors, Grand Rapids, Mich., which experienced a slow start due to unrelenting frozen conditions that closed schools for a record number of days. “Overall, as our numbers stand the majority of those who remained inside made their way out in March, and the pent-up demand had us scrambling to get jobs measured and installed the past three months,” said Deb DeGraaf, co-owner.

The snowiest winter in Rochester, Minn., history couldn’t prevent Hiller’s Flooring America from chalking up solid gains in the first half. Even more surprising is carpet accounted for 72% of store sales. “Carpet is very much alive and well—at least in Minnesota,” said Rob Elder, co-owner.

Positive results did not come without a lot of effort as many dealers see an overall slowdown in the offing. “We have seen growth; however, the overall pace seems to be slowing,” said Palmer Johnson, vice president, Johnson Carpet One Floor & Home, Tulsa, Okla. “While consumer confidence remains relatively high, there seems to be a growing expectation that a downturn may occur within the next 12 months.”

One Southeastern U.S. retailer may have already encountered the impending downturn to which other retailers allude. “It’s like we never had the spring surge from the winter doldrums,” the dealer said. “Traffic is off, sales are off and clients are going with products (and installers) they are saying they know aren’t the quality of what we are offering, but they ‘hope will be OK.’”

The tariff factor
The biggest surprise of the first half may be that the tariffs have had virtually no negative impact on business, according to dealers. It was during the first half that President Trump announced a hike on goods imported from China to 25% from 10%, with the increase taking effect in mid-June. For the most part, the specter of tariffs created some uncertainty and confusion in the market but no real harm to the LVT category, retailers said.

In some instances, the threat seemed to create a sense of urgency that produced a sales increase. DeGraaf acknowledged that while the tariffs have continued to add a level of uncertainty, “It does not seem to have impacted the retail consumer in our market all that much. Even as of today we do not know when, or if, this second round of tariffs will actually hit and stick.”

John Taylor at Taylor Carpet One said he has used tariffs as a closing tool with overall good results. “We also have taken the same approach as we did on the previous tariff—that this is simply an across-the-board price increase on these particular products.”

Crest Flooring’s Weisberg credited suppliers with easing the potential margin impact, explaining, “The 15% additional tariff amounted to 7%-8% from our suppliers. Therefore, we have yet to see a substantial falloff in sales with LVT.”

The tariff issue is being handled differently depending on the vendor, according to Billy Ward, owner, Artistic Finishes Carpet One Floor & Home, Lancaster, Calif. “Some vendors have taken advantage by raising prices on existing inventory while others have said they would absorb a portion or have given us a date of when they would raise prices.”