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Dealers report mixed reviews for first quarter

April 16/23, 2018: Volume 33, Issue 22

By Ken Ryan


The first 100 days of 2018 have yielded some uneven performances for flooring retailers and distributors, with most reporting a slow start in January and February followed by some improvement in March/early April. Still, the prevailing sentiment is that, to date, 2018 has been an underachiever, saddled by late winter weather woes in the East and Midwest along with burgeoning inflationary pressures.

Cathy Buchanan, owner of Independent Carpet One Floor & Home, Westland, Mich., didn’t mince words when asked to assess the first 100 days. “I wish you wouldn’t have to bring up the past when it comes to the first three months of 2018 because they were horrible,” she told FCNews. “I haven’t seen numbers down like this in at least four years. We didn’t make our mark. For January through April 10 we are down 12.7% in written sales. Thank goodness for our delivered sales.”

Buchanan would not use weather conditions as an excuse, either. While acknowledging that it does play a part, she noted it will play a completely different role once the weather breaks. “People will be focusing on their yards and enjoying warm weather. It’s a catch-22 with the weather. I have to think positively, but that is a hard thing to do because we are heading into the summer months when traffic is typically down. I can’t explain this phenomenon; it doesn’t make sense. Retail is struggling and maybe it is due to e-commerce purchases.”

Flooring retail continues to be a roller coaster business month to month, and regional differences play a role. For example, in San Antonio, Atlas Floors Carpet One got off to a rough start before things started to turn around, according to Billy Mahone III, manager. “Overall business has been up the first 100 days, but it is interesting how we got there.” January and February were slower than normal, he noted, but business has been booming since. “We are expecting business to be steady through the rest of 2018, resulting in a moderate, single-digit increase over last year.”

It was also a slow start for The Vertical Connection Carpet One in Columbia, Md., which experienced a lighter-than-normal January. “Since then, business has picked up nicely,” said Adam Joss, co-owner. “We’re pushing full steam ahead; we’re pacing for a record year. At some point, business will turn. However, we don’t see any signs yet.”

A year ago, weather in the mountains out West was brutal with record snow. Not so much this year, and the results proved favorable to dealers like Dillabaugh’s Flooring America in Boise, Idaho. “The first quarter was eerily manageable,” said Casey Dillabaugh, owner. “The mild winter of 2018 has made our ability to fulfill the needs of both residential and commercial contractors at the same time as our retail work.”

Similar to their retail brethren, distributors reported some mixed results. For example, Scott Rozmus, CEO of FlorStar Sales, a top-20 distributor based in Romeoville, Ill., said the first 100 days of 2018 were a little slow vs. 2017. However, he noted 2017 was particularly strong by comparison. “In talking with our clients, weather across the Midwest impacted business in parts of February and March, which usually are fairly busy months. January was OK, but folks were slower later in the quarter.”

Jeffersonville, Ind.-based Gilford-Johnson Flooring, another top-20 wholesaler, finished the first quarter very close to its budgeted goal. However, as it entered the second quarter, call volume and sales were slower than last year. “But I remain very positive, especially now that the Mastercraft acquisition in Florida has been integrated into Gilford-Johnson and the Florida team is fully trained on all of our product offerings,” said Dennis Cook, president and CEO.

Inflation concerns

Industry observers have seen consumers trading down from higher-priced products like wood into LVT and WPC during the first 100 days. The result: Dealers are closing sales, but the ticket might be smaller. Then there is the issue of inflation, which is beginning to rear its ugly head.

“Over the next year it appears evident we will see some significant inflation,” FlorStar’s Rozmus predicted. “Suppliers across the board are announcing significant increases. Many cost inputs are increasing substantially, whether in raw materials, such as plasticizers, or in transportation costs—not just freight per se, but additional costs due to newer regulations, driver scarcity, etc. Many people in the channel have limited experience managing in an inflationary environment. The consumer or end user ultimately needs to bear the cost of inflation but getting there sometimes is easier said than done.”

For Bob Weiss, CEO of All Tile/Carpet Cushions & Supplies, in Wood Dale, Ill., the first 100 days has been more about managing a new location. “We just moved into our new corporate facility in Wood Dale, so the excitement of the combined operations has permeated the first 100 days,” he said.

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Gilford-Johnson meeting ranked ‘best one yet’

March 19/26, 2018: Volume 33, Issue 20

By Ken Ryan


“Driving Performance Together in 2018” was the theme of Gilford-Johnson’s ninth annual Advantage Partners conference earlier this month. Judging by the robust turnout—100 flooring dealers, 19 vendors and 208 total attendees—the one-day meeting was a resounding success.

“More people, more customers and a great deal of optimism and energy—probably our best one yet,” said Dennis Cook, president and CEO of Gilford-Johnson, ranked No. 17 among FCNews’ top 20 distributors with $90 million in sales.

Cook, who returned to the helm of Gilford-Johnson to replace Scott Roy, said the event, which included a trade show and awards dinner, was refreshing because he was able to spend quality, one-on-one time with customers. “That was my primary objective—trying to understand some of their issues. I certainly went around to all of our vendors and thanked them for their participation. Most of the customers I spoke to had really good years in 2017, from 5% up to a 15% increase, and some even more than that. They were quite enthused about 2018. We are certainly excited about 2018 as well.”

Rob Purkins, senior vice president of sales for Gilford-Johnson, who has been at all of the conventions, concurred. “I believe this was the best Advantage Partner event we have hosted in the nine years of the program. We had a great turnout. Our dealers were optimistic about business, and every vendor at the show was swamped the entire day.”

The event was held at the Belterra Casino Resort & Spa in Florence, Ind., just over the Kentucky border. However, attendees traveled by automobile from as far away as Georgia. “We had people from Atlanta, east Tennessee, Nashville,” Cook explained. “We had some people drive from as far away as Atlanta and Dalton to come to the show.”

Many attendees were first-timers, which Cook saw as an encouraging sign for a distributor that boasts an impressive array of suppliers—among them Raskin Industries, Inhaus, Johnson Hardwood Floors, IVC, EarthWerks, Beauflor, Tarkett/Johnsonite and Somerset.

Jodie Doyle, vice president of product management for Gilford-Johnson, said the Advantage Partners event is an opportunity to showcase the latest and greatest products that will hit retail stores in the coming months. “We were really happy to show off the Johnson Premium Reservoir collection, which is our first entry into the waterproof wood segment. The response to that product and all of our new introductions was really gratifying.”

Bill Schollmeyer, CEO of Johnson Hardwood, called it a “great dealer function,” adding, “It’s been a while since I’ve attended a dealer function for a major distributor and it was fun to be part of it. You really get a feel for the relationships Gilford-Johnson has with their customers.”

Cook, who had retired to Alabama but remained a director at the company, was asked to return at the beginning of the year. He said he is happy to be back and will be there as long as needed. “I was asked the question of how long I will be staying a number of times during the meeting,” he recalled. “I have no time frame. My goal is to make this company flourish. We have a lot of opportunities that we can take advantage of.”

At the evening awards ceremony, Carpet Specialists of Louisville, Ky., was named Gilford-Johnson Dealer of the Year for 2017.

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For Gilford-Johnson, it’s full steam ahead

March 13/20, 2017: Volume 31, Issue 20

By Ken Ryan


Screen Shot 2017-03-17 at 11.35.25 AMFlorence, Ind.—Gilford-Johnson Flooring, a top 20 distributor with a marketing footprint that stretches from the Great Lakes to South Florida, welcomed hundreds of vendors and retailers to its spring meeting here earlier this month. The event covered a range of topics, from the integration of Gilford and Johnson to the spate of new products and programs available to its customers.

The merger of Gilford and Johnson, which created a $90 million wholesale distributor, was completed a year ago. However, the company is still working out the kinks. Scott Roy, president and CEO of Gilford-Johnson, knows about the challenges of integration from his days at Haines, which acquired CMH. At the same time, he allowed that much progress has been made.

“Knowing where we are today in terms of integration to where I thought we would be, we are far ahead,” Roy told FCNews. “Today we are operating the company as one. Jodie [Doyle, vice president of product management] said it best when he told staff: ‘You no longer work for Gilford; you don’t work for Johnson—those companies don’t exist anymore. It’s Gilford-Johnson now.’ We are getting big. Therefore, we need the business processes in place to manage our growth.”

Last month, Gilford-Johnson opened a 12,000-square-foot transportation hub in Nashville to help expedite deliveries between its two main facilities, Louisville and Atlanta. The distributor can now deliver product anywhere in its system within 72 hours.

Delivering great product with winning displays is a key to this effort. To that end, the meeting featured WPC and rigid core products from the likes of EarthWerks and Diamond Living, as well as new suppliers. One of them, Raskin Industries, earned praise for its Acrylx solid surface LVT, which it positions as the next-generation of rigid core. “That product is a game changer,” said Rob Purkins, senior vice president, products and marketing, Gilford-Johnson.

Loyalty program

During his tenure at Haines, Roy helped build the Haines Loyalty Club to more than 600 members. Likewise, Gilford-Johnson is putting a greater emphasis on its program, which is now known as Advantage Partners. The program covers the entire Gilford-Johnson footprint and has 285 members. Reinbrecht Flooring of Haubstadt, Ind., joined Gilford-Johnson less than one year ago and signed up for the Advantage Partners program last month. “We were looking for a distributor that sold EarthWerks, which led us here,” said Kurt Paridaen, sales manager. “We pretty much buy every product display in Gilford-Johnson’s repertoire. This is a great group to be a part of.”

Paridaen was one of dozens of flooring retailers who spent the day visiting with suppliers at the trade show portion of the Gilford-Johnson meeting. Donovan Cullen, owner of Coal Field Flooring in Madisonville, Ky., has been attending this event for the past nine years. He was interested in, among other things, the Elements laminate line from Inhaus. “What they offer in terms of looks and durability from a price point standpoint is outstanding,” Cullen said. “Ease of installation is what you are looking for these days.”

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New Gilford-Johnson CEO maps out plans

March 14/21, 2016; Volume 30, Number 19

By Ken Ryan

Florence, Ind.—Scott Roy said he always aspired to be president of a company, but when he was first approached by an executive search firm to run the newly merged Gilford-Johnson Flooring distributor (FCNews, Feb. 29/March 7), he was a bit skeptical. After all, he had a high-level position at Haines, the industry’s largest distributor, and he liked it there.

Screen Shot 2016-03-21 at 9.46.11 AM

But it wasn’t long before Roy seized what many would call a dream opportunity.

“Being president and CEO is one thing, but to join two companies that have the reputation that Gilford Flooring and Johnson Wholesale Flooring have—and to bring those companies together—that is what excites me the most,” Roy told FCNews during the Gilford-Johnson spring event here. “These are two companies that are going places. This isn’t a fixer-upper.”

What was once two mid-sized distributors has morphed into a top 20 player with an estimated $90 million in sales. Moreover, there is virtually no overlap in the two companies’ territories and product portfolio, and they both bring strengths to the table in the form of logistics and warehousing, strong vendor partners and well-respected sales teams.

“Scale in distribution is important because it allows you to expand,” Roy explained. “This is a pure geographic expansion into two of the strongest areas in the country: the Southeast and Florida.”

While at Haines, Roy started the Loyalty Club in 2005 and helped grow it into a successful incentive-laden program. Gilford has the Gilford Advantage Program (GAP), which will be expanded to include Johnson Wholesale retailers. “I believe in the loyalty retention program, and with the addition of the Southeast we can explode this thing,” he said.

The task of fully integrating Gilford and Johnson is just now beginning. Roy plans to create 10 to 12 integration teams focusing on such areas as finance, logistics, claims, credit and fees. Both companies use the Gartman operating system, but within each platform are subtle differences that have to be ironed out. (Integration is an area in which Roy has particular experience as he was intimately involved in the Haines-CMH marriage.)

“One of the values I bring to Gilford-Johnson is that I’m an outsider; I’m coming in with the mindset that we are one company and that it is ‘we’ and not ‘us vs them’,” Roy said.

Among his primary aims: to learn the Gilford-Johnson business and integrate the two companies as seamlessly as possible. “The customer doesn’t care that we bought a company in Atlanta until they see the value it brings,” he said. “We have a joint product selection group that is looking at new opportunities, and building a better logistics service model has to be part of that plan. We need to raise the bar in terms of how we run our business.”

Industry members believe Roy is just the man for the job. Melinda McChesney, former owner of Johnson Wholesale, agreed to sell the company to Blue Equity, the private equity firm that owns Gilford. “We’ve seen so many distribution mergers where one gobbled up another; I wasn’t interested in that,” she told FCNews. “I was interested in the Johnson legacy moving ahead and the Gilford legacy moving forward. We bring diverse products that cross the lines and provide advantages to the other territory. There is not a lot of fat on either side.”

McChesney wanted to bring in a CEO from outside the company who could give fresh eyes to the merger. “I am very excited to see where this leads us,” she added. “I have been asked many times what my dad—who founded Johnson—would have thought. I feel he would be pleased. I know I am at peace with it.”

Convention highlights

Screen Shot 2016-03-21 at 9.46.44 AMThe two-day trade show at the Belterra Casino Resort here included fewer vendors than previous years, which was by design. Yet there were more retailers present than in the past. The end result was bustling traffic at the booths and strong sales activity for the exhibitors. “Gilford-Johnson is really good at finding the niches in each of their product categories, and then they service the heck out of it,” said Nick Freadreacea, president and owner of The Flooring Gallery, with multiple locations in the Louisville, Ky., market. “Gilford is strong in our area and I am very happy to see them growing.”

Vendors were pleased with the traffic as well. Bill Lipinski, Midwest regional manager for EarthWerks, said the company showed several LVT lines as well as 12 new WPC offerings. “How can you not love to sell this stuff? We had a lot of buying going on, and the action at our booth has been outstanding.”

Jim Cook, Southeast regional sales manager for Somerset Hardwood Flooring, said what impressed him the most was the level of engagement among dealers. “They’re not just wandering by; they are asking some really good questions about how the product is made and especially where it is made,” he told FCNews on the first day of the event. “We are proud to say it is made right here in the United States. We have always done well at this show, and we [sold] 10 truckloads of hickory the first day alone. I don’t think you can do any better than this.”

Another highlight of the event was the annual awards banquet, now in its seventh year. In a special ceremony held March 9, the distributor awarded plaques to 68 retailers who sold $100,000 worth of business in the previous year. One of those dealers was Bennett’s Carpet of Russell Springs, Ky., which was named the Above and Beyond winner for the third consecutive year. It is the most prestigious award Gilford bestows on a dealer. “Winning never gets old,” said John Bennett, owner. “I think it comes down to the relationship we have with Gilford-Johnson. If we have issues or problems—and that is invariably going to happen in business—they are here to support us. The Gilford-Johnson staff is loaded with high integrity people.”