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Engineered Floors completes asset purchase

Screen Shot 2017-11-16 at 9.56.41 AMDalton, Ga.—Engineered Floors has purchased substantially all of the operating assets of Beaulieu Group. This completes a process that began formally Sept. 20 with a letter of intent.

“We are pleased with the quick approval of the bankruptcy court of our purchase agreement,” said Robert E. Shaw, founder and CEO of Engineered Floors. “We can now move forward building an even stronger floor covering industry in our community.”

Beaulieu of America opened in the mid ‘70s and grew to become the third-largest carpet manufacturer in the United States, with annual sales approaching $1 billion at the start of the recession in 2008. The company then shortened its name to Beaulieu America and broadened its product offerings to include hard surfaces. At the same time, its specified commercial division, Bolyu, began gaining the attention and respect of the architectural and design community.

Engineered Floors is now in the process of determining the integration of Beaulieu America personnel, as well as physical and intellectual property assets and brands for its continued growth. The company will make announcements over the next few months regarding these decisions.

“Right now, we’re focused on minimizing the impact Beaulieu’s bankruptcy and this acquisition has on the people and the community in North Georgia,” said James Lesslie, executive vice president of sales and marketing for Engineered Floors. “We are placing as many former Beaulieu associates as we can and assessing the best use of the various offices and facilities here. We want the floor covering community to emerge from this chapter stronger than ever before.”

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Engineered Floors poised to purchase Beaulieu Group

October 9/16, 2017: Volume 32, Issue 9

By Ken Ryan

 

Screen Shot 2017-10-17 at 9.27.53 AMDalton–Engineered Floors’ agreement to purchase substantially all operating assets of Beaulieu Group—a deal pending bankruptcy court approval—would make EF a dominant No. 3 player in the carpet segment, a billion-dollar player overall, trailing only industry titans Shaw and Mohawk.

If approved, which is expected, the deal could be consummated in November.

Back on Sept. 20, Engineered Floors and Beaulieu Group had agreed to terms in a letter of intent. (Beaulieu Canada, which is not a subsidiary of Beaulieu Group, is not part of this deal.) The companies have now concluded those negotiations and executed a definitive agreement.

Engineered Floors did not divulge many details of what its plans are post-acquisition, other than to say it intends to operate the assets going forward and continue to grow the residential and commercial businesses. “This will be good for both our business and the community,” said Bob Shaw, chairman and CEO, Engineered Floors.

When asked specifically if Engineered Floors would retain the Beaulieu brand, or whether it would bring back the Coronet name—as has been speculated—a company spokesman said there would be no comment beyond the initial press release.

Fast-track growth
Since Bob Shaw founded Engineered Floors in 2009, the company has quickly grown. Its 2016 sales were $659 million and it has a strong position in the multi-family builder market; it serves the residential sector through distribution under the Dream Weaver brand. In April 2016, Engineered Floors acquired J+J Flooring Group, a commercial carpet specialist with sales of approximately $140 million. Last summer the company launched its Pentz Main Street division.

Screen Shot 2017-10-17 at 9.28.02 AMSince its purchase J+J Flooring has operated as an independent division under Engineered Floors. There is speculation that Beaulieu could also be operated as its own entity under the Engineered Floors flag. James Lesslie, executive vice president of sales and marketing, came over from Beaulieu in 2009 when the company was started; he was chief operating officer at Beaulieu when he left. Beaulieu’s annual sales are estimated to be approximately $350 million. Combined with Engineered Floors, the entity would exceed $1 billion in 2016 sales.

Since founding Engineered Floors, Shaw has created thousands of jobs in Whitfield County. Today the company employs 3,000, with more to be added as manufacturing facilities come online. One well-placed industry executive said Bob Shaw contacted Beaulieu to obtain a list of all the Beaulieu employees who had been laid off in the past six months. Engineered Floors did not comment on a question regarding Beaulieu employees.

Beaulieu filed for Chapter 11 bankruptcy on July 17. At the time, the company believed the process of reorganization would position it for future success. “Beaulieu family members and our board of managers believe pursuing a restructuring through Chapter 11 is the best path forward at this time,” Michael Pollard, president of Beaulieu Group, said at the time. “We have evaluated alternatives to address Beaulieu’s capital structure, and we believe restructuring through the Chapter 11 process will best position all of Beaulieu Group LLC’s businesses for future success.”

Founded in 1978, Beaulieu America, which until recently was the No. 3 carpet mill, employs upwards of 2,500 associates in more than 12 facilities and offices across North America. In addition to the Beaulieu brand, the company manufactures medium-priced commercial carpet under the Cambridge label, high-end specified carpet under the Bolyü label, and needlepunch floor covering products sold through Murray Fabrics and the company’s surfaces divisions.

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Engineered Floors reaches a letter of intent to purchase Beaulieu assets

engineeredfloorsDalton, Ga.– Engineered Floors has reached a letter of intent agreement in principle to purchase substantially all of the operating assets of Beaulieu Group. The transaction will be contingent upon approvals through the bankruptcy court and due diligence processes. Pending governmental approvals, the transaction is expected to close in the fourth quarter of 2017.

Note: Beaulieu Canada is not a subsidiary of Beaulieu Group and is not affected nor part of the letter of intent agreement.

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Beaulieu America continues to execute long-term strategic plan

Screen Shot 2017-04-11 at 2.26.54 PMDalton, Ga.—Beaulieu Group, a leading family owned business within the flooring industry, continues its long-term strategic plan to streamline its product portfolio and manufacturing network to emphasize growth and profitability. Today the company announced the sale of its Bridgeport Fibers Plant in Bridgeport, Ala., to Mohawk Industries, based in Calhoun, Ga.

In January Beaulieu announced that it would be closing the Bridgeport plant by March 31, 2017 as the beginning of its long-term strategic initiatives. “The decision to cease operations at Bridgeport Fibers was difficult,” said Annette Cyr, executive vice president human resources, Beaulieu Group. “Our team worked closely with many local employers to assist employees impacted in finding new opportunities. This is consistent with our tradition of supporting members of the Beaulieu family.”

Michael Pollard, president of Beaulieu America, added, “We believe this has been the most favorable outcome for our company and those associates who have worked for us over the past many years. With this successful transition, we will continue to streamline and elevate our product portfolio, emphasizing growth and profitability.”

Beaulieu will continue to operate its Memofil fiber plant in Dalton, Ga.

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Executive Forecast: Carpet—Mills predict rebound as improving economy takes hold

December 5/12, 2016; Volume 31, Number 13         

By Ken Ryan

 

While 2016 was less than stellar for carpet mills—due in part to the acrimonious Presidential election that some believe hurt consumer spending—executives are looking to bounce back in 2017. Buoyed by an improving economy that many see gaining significant traction, mill executives are forecasting anywhere from a 2%-5% gain, which, if true, would easily eclipse 2016 figures.

Mark Clayton, president, Phenix
screen-shot-2016-12-16-at-9-31-09-amWhat is your projection for category growth next year?
We anticipate the soft surface category will experience modest improvements with a more robust opportunity in the mid-upper ends of the market. There is pent-up demand and we are hopeful that continuing favorable economic indicators will result in a more confident consumer.

What is the “X factor” that will impact business next year?
From a carpet perspective, I think it will be the continued popularity of hard surface and the manufacturers’ ability to create and bring to market soft surface products that are compelling enough to maintain and take back market share. Obviously the state of the economy will also be an “X” factor.

Where do you see opportunities for next year? Challenges?
There will continue to be wonderful opportunities for those who are able to bring unique styling, solutions, simplification and differentiation to the consumer. We will continue to be challenged with the increase in popularity in hard surfaces. Our response is to develop products and programs to support those opportunities and leverage the unique attributes of soft surfaces.

What are some of your biggest initiatives for 2017?
We will introduce several new product platforms at Surfaces 2017. This will represent our most dynamic launch of new programs to date. In addition, we will follow up on our successful 2016 hard surface launches with the introduction of several new products and programs. These products will offer a unique technology to help simplify consumers’ lives.

 

Steve Hillis, president, Beaulieu Group
screen-shot-2016-12-16-at-9-31-14-amWhat is your projection for category growth next year?
The projection for 2017 overall flooring industry growth is 3%-5%. We feel that we could experience greater growth at Beaulieu because we are investing in new products, new displays and a major focus on marketing and branding.

What is the “X factor” that will impact business next year?
The biggest factor is interest rates. Many owners and developers have been waiting to see what the interest rates do, and many expect to see rates rise in the first quarter of 2017. We feel economic conditions will remain strong and could gain steam if the new administration is able to lower corporate tax rates and keep jobs in America.

Where do you see opportunities for next year? Challenges?
We see opportunities with our hard surface business for the residential and commercial markets as well as growth opportunities in the upper end of residential and corporate markets. The challenges will be maintaining a strong housing increase and stable economic environment. Adding labor in the plants could be a challenge as the flooring industry in North Georgia has low unemployment and the competition for labor is fierce.

What are some of your biggest initiatives for 2017?
Some of our top initiatives at Beaulieu for 2017 are to focus on expanding our residential and commercial product offerings with many stylish and innovative carpet and hard surface products. Updating our brands, investing more in marketing, and training the sales team will be key initiatives.

 

Doug Jackson, vice president of sales, Tuftex
screen-shot-2016-12-16-at-9-31-20-amWhat is your projection for category growth next year?
In 2016 we gained market share in soft surfaces, staying a few points ahead of the industry. We remain conservatively optimistic and expect to perform similarly in 2017. We have to continue to deliver unique looks to consumers and dealers while offering the best quality and service.

What is the “X factor” that will impact business next year?
The industry continues to innovate and create more flooring options. The consumer is bombarded with options, information and sometimes distraction. The manufacturer who can capture the attention of a consumer who seeks immediate inspiration and needs transparency in all transactions . . . will lead the way in 2017 and beyond.

Where do you see opportunities for next year? Challenges?
The shift from soft surface to hard surface is both an opportunity and a challenge. No soft surface manufacturer can expect the average order to be what is has been these past five to 10 years. Our Signature Collection product mix and especially our newest introductions featuring sophisticated 3-Color Point technology are a timely response to the smaller carpet install but of a higher end product.

What are some of your biggest initiatives for 2017?
We will continue to support the Tuftex Classics collection with fresh updates for 2017. The “heart of Tuftex,” our Signature collection, will be fortified with a strong offering of new Anso Caress textures and level-cut-loop patterns; 2017 will be defined by some of the most innovative yarn blends, constructions and designs ever introduced.

 

James Lesslie, executive VP – sale, Engineered Floors
screen-shot-2016-12-16-at-9-31-26-amWhat is your projection for category growth next year?
Post-election we have seen positive momentum. We believe that momentum will carry into 2017 for a positive year of growth in the carpet industry. We also recognize that 2%-3% top line growth in 2017 would basically allow the industry to recover to 2015 levels.

What is the “X factor” that will impact business next year?
The biggest “X” factor for the overall economy is our new President. Can he build coalitions in the House and Senate to encourage U.S. manufacturing investment and improve our economy? Specific to carpet, suppliers who bring new innovations in styling, performance and value to the consumer will be rewarded and continue to grow.

Where do you see opportunities for next year? Challenges?
We see a number of opportunities for growth in the year ahead especially in Main Street and modular carpet with the addition of our Pentz Commercial Solutions line. We are also in the process of developing some additional products and features for 2017. As for challenges, they’re no different than any rapidly growing business, and they’re all good…plant expansion, personnel additions, increasing territory, etc.

What are some of your biggest initiatives for 2017?
Engineered Floors has experienced rapid growth over the last six years, and we expect that to continue into 2017 as one of the fastest-growing carpet companies in the world. We have grown to 3,000 employees since our inception in 2010. We see our role as leading the way for growth in carpet, whether it’s in residential, new construction, multi-family or Main Street.

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Carpet: Style and performance define 2016 intros

November 21/28, 2016: Volume 31, Number 12

By Ken Ryan

Carpet mills ratcheted up their R&D efforts in 2016 like never before to deliver to the market a constellation of compelling products that cover all the important bases: style and design, durability, softness, and stain and pet protection.

Following is a closer look at the some of the top introductions and innovations from 2016:

Beaulieu Group
screen-shot-2016-11-28-at-2-53-20-pmSo Suede and Mulberry have been successful additions to Beaulieu’s Stylish Beauty collection featuring 24 new PermaSoft fiber offerings. These products incorporate Beaulieu’s patented Precision Control Twist (PCT) technology, which creates dimensional color and texture throughout the yarn bundle to produce unique surface characteristics when manufactured. “The art is our ability to combine a variety of fibers with different colors, sizes, lusters and dye abilities which then blend together in varied twist capacities creating a unique face canvas,” said Tom Ellis, chief marketing officer. “We enhance the beauty of the fiber with tuft technology to highlight the organic nature of the stria.”

Ellis noted the organic nature of the technology minimizes the appearance of soil, stain and wear. He said the response to the collection has been “tremendous with So Suede and Mulberry resonating with our customers in a phenomenal way. Our customers have featured this product in all their displays because the consumer acceptance has been so great.”

Two 2016 introductions, Scenic City and Cornerstone, offer what Ellis termed “a sophisticated alternative to what they have seen on the market at an affordable price point.”

Engineered Floors
Bolstered by new introductions in both the commercial and residential markets, 2016 has been a year of unprecedented growth for Engineered Floors.

screen-shot-2016-11-28-at-2-52-42-pmPentz Commercial Flooring Solutions is being marketed as a “bold new day” for Main Street. According to company executives, Pentz promises maximum performance, leading warranties and features, backed by competitive pricing. The three collections, Essentials and Formation (modular) and Prismatic (modular and broadloom), are made with the company’s Encore SD Ultima Nylon with Nexus backing. The products are available via QuickShip.

FlexBac is the first premium backing system offered within the entry-level residential product category. FlexBac is noted for its flexibility and dimensional stability. Another plus is its anti-delamination warranty. “FlexBac has no latex, thus increasing the ease of installation by being lighter, more flexible and softer while saving time, energy and money,” said Mike Sanderson, vice president of product marketing.

Engineered Floors’ Dream Weaver made news with its lifetime pet warranty, which promises “a lifetime of relief for you and your pet.” The distinctive purple shield assures the polyester or nylon carpet is warranted against accidental stains caused by dogs or cats.

Marquis Industries
screen-shot-2016-11-28-at-2-52-51-pmMarquis Industries continues to enjoy success with its soft yarn program, led by Soft Luxury, an 80-ounce solution dyed PET fiber that is the mill’s largest volume producer. The company introduced junior versions of Soft Luxury during the summer, in 60- and 45-ounce weights.

Other new introductions: Natural Wonder, also an 80-ounce weight that incorporates a natural shield stain protection fiber; and Naturally Soft, a 60-ounce product that combines the best colors from other lines. “Soft Luxury is our No. 1 product and has a beautiful finish and luster level,” said Mike Lindberg, executive vice president, Marquis Industries. “Dealers are asking for soft yarn and ours is as soft as anything in the industry.”

Marquis Industries’ secret sauce is its extrusion plant that produces millions of pounds of continuous filament solution-dyed polyester and nylon. These cones of yarn are then processed in a computer-controlled twisting and heat set plant. Every yarn SKU is regulated to ensure products are made to the same high-quality specification every time.

Mohawk
screen-shot-2016-11-28-at-2-52-27-pmSmartStrand Forever Clean, installed in more than 7 million homes and heralded for its durability, stain resistance and comfort, has become an even “smarter” choice for active families with pets. In 2016 Mohawk enhanced this popular carpet with All Pet Protection, a warranty and protection system that covers all pets, all accidents, all the time.

“We continue to build on the success of the incredibly soft and durable SmartStrand fiber we introduced 10 years ago,” said Seth Arnold, Mohawk’s senior director of soft surface brand. “SmartStrand has evolved into SmartStrand Forever Clean, a carpet that employs Nanoloc technology to lock out spills and make the carpet even easier to clean. And now we are introducing the All Pet Protection warranty because we believe SmartStrand Forever Clean carpet can handle all pets, all accidents, all the time.”

SmartStrand Forever Clean carpet has been tested in zoo habitats for animals of all types. While built-in stain and soil protection that never wears or washes off is inherent in the SmartStrand fiber, there is more to the SmartStrand story, according to Arnold. Nanoloc’s advanced spill-resistant shield, he said, is made from nanoparticles that seamlessly lock together, preventing dirt and spills from settling into the carpet. With SmartStrand Forever Clean, soil is released at three times the rate of other carpets, allowing for a carpet that is easier to clean and requires less vacuuming.

SmartStrand Forever Clean has the added advantage that liquids cannot absorb into the fiber. Compared to nylon carpet, which absorbs up to 5% of its weight in liquid, SmartStrand Forever Clean offers 0% absorption—a huge advantage in a family with pets. “For families who want to make sustainable choices for their homes,” Arnold said, “this carpet is made in part with annually renewable plant-based materials that minimize our usage of limited natural resources. It is also the only carpet fiber certified free from harmful substances by Oeko-Tex.”

Phenix
Phenix added three new products to its Stainmaster PetProtect line this month—Lyrical, Poetry and Narrative. These multi-color patterned carpets employ innovative technology that allows for varying pile heights, ensuring each carpet has a unique combination of toned neutrals that come together to create a fresh contemporary palette. All three products feature cut patterns so dogs, cats and other household pets won’t snag their claws on loops and cause pulls.

Shaw Floors
screen-shot-2016-11-28-at-2-52-34-pmShaw continues to develop products featuring its exclusive LifeGuard waterproof backing system, which responds directly to consumers’ need for ease of maintenance combined with the comfort and softness of luxurious carpet. “As we’ve expanded the styles available with LifeGuard—starting with Life Happens, and subsequently with Anso Living—we’ve been able to offer this stylish, high performance product at a variety of price points to meet customers’ purchase decisions,” said Brad Christenson, director of category and product management, Shaw Floors.

Shaw’s research and development teams collaborated to design the waterproof LifeGuard backing system with its R2X stain and soil protection technology built in. This combination works to stop liquid spills and inevitable accidents from reaching the cushion and subfloor, preventing potential odors, wicking and subfloor damage. “LifeGuard successfully elevates our carpet collections making the upgrade a no-brainer for our customers who are searching for the cleanability and durability LifeGuard provides,” Christensen said. “In turn, it provides an easier sales process for our retailers by combining a variety of features into one carpet option they can easily explain and confidently sell, and an innovative, unmatched solutions for their customers’ homes.”

Christensen said LifeGuard has been widely accepted as the go-to product for pet owners and busy families who don’t want the stress of high-maintenance carpet. “With LifeGuard, our retailers have been able to tell their customers that stains and odors can now be 100% removed.”

Shaw plans to deliver more LifeGuard-enabled products to the market in 2017.

Stanton
screen-shot-2016-11-28-at-2-53-14-pmThe newest styles from Stanton’s Atelier Icon collection—part of the hot-selling Stainmaster PetProtect program—are made with nylon 6,6, making it an ideal choice for rooms with heavy traffic.

The abstract designs and neutral colors of Aspire Waterfall and Aspire Concept overlay each other, creating an artistic blend of random shapes and cross hatched patterns accented by tip sheering. According to Stanton, Aspire Network’s all loop trellis design and interlocking shapes merge to create a double-layered effect; Aspire Compass is a multi-edge look, outlined with diamonds.

Other 2016 introductions include the Relax collection, which provides an avant-garde style with vibrant color accents; and Garden of Eden and Centered, which are treated with antique effects to keep these designs modern, abstract and transitional.

Tuftex
Tuftex is known for natural, solution-dyed and barber-pole yarns that combine with the latest tufting technologies to create differentiated products. This was illustrated with Colorpoint, its first cut and loop line.

screen-shot-2016-11-28-at-2-53-07-pmColorpoint technology allows the precise placement of color with the combination of finely controlled yarn feed systems and sophisticated software. “You can get closer to the woven looks yet produced with efficiencies and speed of today’s tufting machines,” said Jim Cusick, director of manufacturing, who explained the cut and loop construction allows for greater diversity of products by blending yarns, densities, texture and construction. “With a finer gauge machine we are able to use softer more luxurious yarns for greater sophistication and still retain superior performance characteristics.”

The first Colorpoint introductions were two-color solution dyed products. This year Tuftex utilized blends of barber poles, natural and over-dyeable yarns to create distinctive, high performance and fashionable looks.

“These Colorpoints are not easy to make but we are committed to respond to the market demand for a new and innovative soft floorcovering product,” Cusick said. Tuftex is able to combine the unique use of yarns with tufting and proprietary dyeing technology to service a full offering of colors and looks that are hard to replicate.

 

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Tom Ellis named chief marketing officer at Beaulieu

Tom Ellis (002)Dalton–Beaulieu Group announced the appointment of Tom Ellis as chief marketing officer of Beaulieu America for both residential and commercial activities.

“I’m excited about the opportunity to lead all the marketing efforts and being part of this family-owned business that is so committed to their customers and associates,” Ellis said.

Ellis joined Beaulieu after more than 30 years of senior management experience, including stints at Tandus and Armstrong.

“We are happy to have Tom as part of our management team with his extensive experience and excellent track record in the commercial and hospitality market segments,” said Michael Pollard, president of Beaulieu Group. “Our residential and commercial activities are poised for substantial growth and we know his leadership and vision will help our business attain its new goals.”

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Boe announces retirement, Vercruyssen named CEO/president

Karel Vercruyssen, left, and Ralph Boe

Dalton – Beaulieu Group announced a transition to dual CEOs as Dr. Ralph J. Boe, CEO of Beaulieu America, prepares his retirement from the company he has led for a dozen years. Boe’s retirement will be effective February 28, 2014. Beaulieu Group also announced that Karel Vercruyssen has been promoted to CEO/president of Beaulieu America, effective immediately. Vercruyssen was named president and COO of Beaulieu America in April, 2012. Prior to joining Beaulieu America in 2012, Vercruyssen was CEO and president of Beaulieu Canada for five years. Continue reading Boe announces retirement, Vercruyssen named CEO/president

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Mohawk's Joe Foye receives Smrekar Award at CRI annual meeting

From left: CRI president Werner Braun, Mohawk's Joe Foye, David Moody of Milliken

The Carpet and Rug Institute (CRI) held its Annual Membership Meeting on Wednesday, November 14, 2012 at the Northwest Georgia Trade and Convention Center in Dalton. Outgoing CRI board chairman John Wells offered remarks on the current state of CRI, including the carpet manufacturing trade association’s 2012 restructuring process as well as the organization’s move into an historic building in downtown Dalton and away from the headquarters building it had occupied since 1971.  Continue reading Mohawk's Joe Foye receives Smrekar Award at CRI annual meeting

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Beaulieu announces Hurricane Sandy disaster relief program

Dalton — In the wake of one of the nation’s most devastating storms, Beaulieu of America announced its program to support the Red Cross effort in the hardest hit areas.

Beginning Monday, November 12 and going through Monday, December 10, 2012, Beaulieu will donate $10 to the American Red Cross for every shipment of Bliss Healthy Touch or Bliss EverClean carpets made to New York or New Jersey. For a complete list of eligible styles, dealers should contact their Beaulieu representative. Continue reading Beaulieu announces Hurricane Sandy disaster relief program