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National Floorcovering Alliance: Opportunities lie in diversification beyond flooring

April 30/May 7, 2018: Volume 33, Issue 23

By Steven Feldman

Cancun, Mexico—As the National Floorcovering Alliance (NFA) embarked on its spring meeting here last month, Dave Snedeker, president of the group and division merchandise manager, Nebraska Furniture Mart (NFM), set forth one mission: get a feel from each member as to how the NFA board can add value to the membership. At the end of the day, the answer was, in a word, diversification.

As successful as NFA members may be—after all, they comprise some of the biggest and best independent flooring retailers in the country—many have not ventured beyond their core business into products like window treatments, countertops and cabinets. “Some members are looking at [diversification],” Snedeker said. “Some are just starting in it. Some aren’t doing it at all. So we’re just trying to make the connections easier so they can decide if that’s the route they want to take.”

NFA will facilitate this by bringing these types of companies to their meetings and opening up the communication lines. “I can’t think of a better way given the format of our meetings than to bring in somebody like a countertop, cabinet or window coverings supplier,” said Deb DeGraaf, co-owner, DeGraaf Interiors, Grand Rapids, Mich. “We’re amongst a group of people we trust and value their input.”

DeGraaf sells window treatments and countertops. “We’ve grown our window treatment business quite a bit, but I would like to do more with it.”

Macco’s Floor Covering Center in Green Bay, Wis., sells neither cabinets, countertops nor window treatments, so there is plenty of opportunity to grow in these non-flooring categories. “There are a lot of sand boxes we’re not playing in right now that we need to explore,” said Jim Walters, president.

Likewise, diversification into non-flooring products is uncharted waters for Flooring 101 in Ventura County, Calif. “Like many in the group, we’re definitely looking at those avenues where we don’t participate now,” said Ian Newton, president. “The beauty of the group is sharing ideas. There are a lot of people out there making those first mistakes along the road that we can learn from. They can tell us what worked, what didn’t work and how to get there. It’s really an educational process for us all. With more hard surfaces being sold, we’re getting less frequency of that return customer. So we have to diversify the products we offer.”

Ambassador Floor Co. in St. Louis is another NFA member that currently sells only flooring. “In the past we’ve done other things; the recession knocked some of them down,” said Kelly Taylor, president. “But it’s time to take another look at it. As you talk to the rest of the group, I was surprised at the success some are having with window treatments.”

Nebraska Furniture Mart is, of course, involved in all categories as the retailer sells everything from furnishings to electronics. “We’re just on the cutting edge of the cabinet business, but we’ve done countertops for several years now,” Snedeker explained. “It’s a very big category for us.”

Paint is one relatively new category that might be of interest to NFA members. “We’ve talked about paint in the past,” Snedeker noted. “We have one member who’s very good at it. That’s the winning part of this group; if somebody is already doing it and doing it well, you can visit his store and see whether or not you can do it.”

Metroflor joins vendor ranks

With the demise of companies like Beaulieu and Royalty, the meeting marked the debut of Metroflor as a core vendor. “Metroflor does a decent business with a lot of our members,” Snedeker said. “They have a pretty solid line. They do good business in multifamily, and that’s where a lot of the business is going right now.”

Metroflor also has the ability to service everyone in the group. “That’s one thing we have to look at; people have to be able to cross the border into Canada and also be able to service the [entire] U.S. market,” Snedeker explained.

Metroflor had previously been a specialty vendor for a number of years, exhibiting at the afternoon showcase on Surfaces eve. “It’s almost like a vetting process,” DeGraaf said. “How did they perform and rate as a specialty vendor? If many of us believe a company is disorganized, they are not going to move up to the next level.”

Speaking of the Specialty Vendor Showcase, Cali Bamboo and Xintory were two companies that scored well with members. Cali Bamboo manufactures green building materials made primarily of bamboo and offered something unique to the group. Company president Doug Jackson has a good relationship with the group from his Tuftex days, Newton said.

Xintory is billed as the flooring industry’s first online marketplace to buy and sell drops, seconds and overstocked inventory. “I can see the concept being very valuable whether you want to get rid of something or find something,” DeGraaf said.

Installation issues

The one challenge NFA members continue to face is the same for all flooring retailers across the board: installation. The one variable is how NFA members attack the issue.

Nebraska Furniture Mart, for example, collaborated with the local community college for a training course. “We just graduated our first class; there were six who took the class and four of them are going to start with us,” Snedeker said. The class is taught by Nebraska Furniture Mart’s installation manager along with some installation experts employed by the retailer.

Flooring 101 is finding installation to be more of a challenge on the soft surface side, especially with the more intricate patterns. “We have a lot of good crews for hard surface,” Newton said. “You have to pay a lot more money. The challenge on the soft surface side is the jobs are smaller. You’re looking at 50-, 70-, 80-yard jobs now because carpet has gone to the bedrooms and the rest of the house is hard surface. A crew can’t make a living on 70 yards, so they end up doing two jobs in a day. The challenge now is servicing the customer between scheduling. So, we see a lot of challenges both on getting it installed correctly and making enough money for them.”

 

 

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Nebraska Furniture Mart names new president, COO

screen-shot-2016-12-20-at-9-41-20-amOmaha, Neb.—Nebraska Furniture Mart’s Tony Boldt, presently the company’s Kansas City store director, has been named president and COO. The transition is part of long-term succession planning for Nebraska Furniture Mart’s future. Current president and COO Ron Blumkin will still be active in the business as Chairman, and Irv Blumkin will remain with Nebraska Furniture Mart as CEO.

“Tony is a focused, dedicated and creative leader,” Ron Blumkin stated, “who will be an exceptional leader for Nebraska Furniture Mart’s future.” In his new role, Boldt will continue the customer-focused vision and mission for Nebraska Furniture Mart.

“I am extremely fortunate to have the skilled and dedicated team at Nebraska Furniture Mart to deliver exceptional products, value and service to our customers,” Boldt said of his new role. “I look forward to leading this dedicated team and continuing on with Nebraska Furniture Mart’s strong commitment to our customers and communities we serve.”

Boldt has had significant experience within Nebraska Furniture Mart starting at Homemakers Furniture, a subsidiary of Nebraska Furniture Mart in Des Moines, and in 2002, taking a leadership role directly for Nebraska Furniture Mart in the warehouse in Clive, Iowa. Boldt rose to store manager of the Clive, IA Nebraska Furniture Mart operation before transitioning in 2011 to Omaha as the appliance and electronics general sales manager. In December of 2012 he was promoted to his current position as store director of the Kansas City Nebraska Furniture Mart store where he has successfully led and managed all aspects of store operations.

As Chairman, Ron Blumkin will continue to oversee Nebraska Furniture Mart’s subsidiaries including Homemakers Furniture in Des Moines, Iowa, Floors Inc. in Omaha, Neb., and Grandscape in The Colony, Texas. In addition, he will be an ambassador for Nebraska Furniture Mart inside and outside the company.

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NFM goes big in Texas with largest location yet

April 13/20, 2015; Volume 29/Number 1

By Steven Feldman

20150408_170311The Colony, Texas—They say everything is bigger in Texas, so why would Nebraska Furniture Mart (NFM) want to be different? As one of the largest flooring retailers in the U.S., NFM on March 2 opened the doors to employees on its fourth—and largest—store in this suburb of Dallas after two years of construction.

The latest and greatest NFM is about as certain as death and taxes to eclipse the volume achieved at its other locations simply because of critical mass. There are 6.8 million people who reside in the Dallas metro area as compared to 1.8 million in Kansas City and 1 million in Omaha. In addition, NFM hopes to draw from a 150-mile radius through its massive marketing efforts, which include radio, TV, direct mail and more.

Store officials predicted from the outset that it would be the highest-volume furniture store in the U.S., and $1 billion in annual sales is not out of the question, a level only one store has reached—the 2.2-million-square-foot Macy’s in Manhattan.

NFM is the first tenant to open on a 433-acre space off the Sam Rayburn Tollway (TX 121) that it purchased in 2011. The land is in the first phase of a development project called Grandscape, which, when completed in a few years, will include retail, entertainment and hotels.

The flooring department of the new NFM comprises approximately 40,000 of the 560,000-square-foot behemoth—which equates to nine football fields on two levels—supplemented by 1.3 million square feet (22 football fields) of warehouse space.

While the space dedicated to flooring in Dallas is slightly larger than both the Omaha flagship and Kansas City location, and much larger than Des Moines, Dave Snedeker, division merchandise manager, told FCNews that the differentiator is how the space is allocated to the respective flooring categories. “The blend here is approximately 50/50 carpet and hard surface. The hard surface department in Dallas is much larger than Omaha or Kansas City simply because we knew hard surface was a bigger player in this market.”

But carpet still commands the largest amount of floor space of any individual product with what Snedeker estimated to be around 10,000 SKUs. Shaw and Mohawk own the largest share, but many other mills have a presence, most notably Tuftex, Royalty, Beaulieu, Nourison and Dream Weaver. About 25% of the products are Stainmaster branded. “We think we have everything covered,” he said. “In fact, consumers may be seeing product they have never seen in this market.” More than 250 carpet styles are stocked for immediate shipping.

The merchandising is also appealing to consumers. All racks are low level and provide a clean, uniform look.  In addition, there are custom displays from Tuftex that highlight patterns goods as well as an Anso color wall with a design exclusive to NFM.

Soft surface selection extends to area rugs, which occupies about 10,000 square feet of space. The mindset here is to offer an extensive array of rugs given the propensity of consumers in this market to purchase hard surface. About 3,000 rugs are displayed on the floor, hanging in racks or in furniture vignettes. Price points range from $5 to $20,000 in styles that run the gamut from machine-made to handknotted and handtufted.

The differentiator here, Snedeker said, is the hanging rugs are color coordinated. “They go from black to brown and so on. This has been a big hit with customers. It makes it so much easier for them to find the colors they are seeking. We have been getting the most comments about that.”

As for hard surface, the hardwood area is the biggest of the bunch. Product is displayed against the wall as well as on low-level racks, continuing on the uniform theme. “Wood is the biggest category down here,” primarily engineered, Snedeker said. “For us it’s about selection, having the right amount of scrape, texture, color, etc.” Price points range from about $2 to $10 a square foot.

Dallas is also a big market for ceramic tile, and, as such, NFM has a vast array of product from many suppliers. “Ceramic tile is something we don’t do as well with in [our other stores], but we are learning on the fly,” he said. “We have great vendors and a beautiful department.”

And, of course, LVT, the industry’s fastest growing category, is highlighted. “LVT is now about 15% of our total sales if we eliminate rugs,” Snedeker noted. Around 20 suppliers have product in NFM’s Dallas location, including Shaw, Mohawk, Karndean, Earthwerks, USFloors, Mannington, Armstrong and some distributor private-label brands. “LVT is installed on the drive aisle for a reason. It’s a growing category.”

Unique pricing strategy

NFM has one of the most progressive pricing methods in this—or any—industry. Everything in the store (except area rugs) has digital tags, so pricing can be readjusted instantaneously if need be. And that extends across all four stores. “When we make the change in Omaha, we make the change everywhere,” Snedeker said. “Depending on where the competition is priced or what we are seeing in the marketplace, we can digitally input pricing per SKU to beat the competition or readjust by the day if there is a sale.”

Most digital tagging for flooring has happened in last month. “This is new to us,” he said. “We have been doing this in appliances and electronics for quite some time.”

NFM also uses technology to make sure its pricing is lower than the competition. Every night, the retailer uses what it calls a “spider” to search multiple websites.  “Right now the program is only for specific SKUs in electronics and appliances. The spider electronically shops over 30,000 SKUs on 20 websites of leading competitors overnight, and brings the information back to us so we can adjust pricing and be the lowest in the market. The idea is that in the not-too-distant future this initiative will extend to flooring.”

Flooring execs out in full force

A gala charity event—the Live Big Benefit—was held April 8 at NFM to benefit Cancer Support Community North Texas, an event that also featured a Q&A session with Warren Buffett, chairman and CEO of Berkshire Hathaway, which owns 90% of NFM. The occasion brought out floor covering executives in droves to get a first-hand look at the industry’s latest and greatest retail space.

To say Piet Dossche, president and CEO of USFloors, was impressed would be an understatement. “This store is overwhelming. It’s amazing how much product is available. Anything that is available is here. I also like the open floor plan; it’s inviting. You can see across the entire store from one end to the other. This is the next generation from Omaha with the fresher, cleaner look. They clearly learn from what they have done in the past.”

Dossche particularly noted the merchandising of hardwood. “I like the large samples and large displays. It enhances the product. They also do a good job of combining those displays with vignettes on floor.

Matt Kahny, president of Unilin US, Mohawk’s hard surface division, was equally impressed. “I think they do a wonderful job of presenting product to consumer. They have an incredible assortment and they do it in a way that’s not overwhelming. They make it easy for the consumer to figure out what product she wants, then she can select colors and textures. We are proud to have all our brands represented.”

Larry Browder, president of Karndean, cited not only with the breadth of product, but also the presentation. “I think what separates NFM from the homeowner’s perspective is you can get everything from the floor to the ceiling and everything in between. The flooring section looks great. We feel very happy about our position on the end caps. It’s a prime position in the store.”

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In-store credit proving to be a boon for retailers

Innovative, tailored programs working best

By Louis Iannaco

Oct. 21/28 2013; Volume 27/number 13

Flooring America of Franklin in Franklin, Mass., runs  an in-store credit program targeting realtors.
Flooring America of Franklin in Franklin, Mass., runs
an in-store credit program targeting realtors.

In-store credit is something that has been available to flooring retailers for a number of years. Depending on a dealer’s business philosophy and  comfort level while utilizing these innovative methods, some decided to take advantage of these programs, ultimately benefitting from unexpected sales. FCNews spoke with a few dealers implementing credit options.

Dave Snedeker, division merchandise manager for Nebraska Furniture Mart in Omaha, explained the company offers several credit promotions each month, most of which span 18 to 24 months. “On few occasions throughout the year, we will offer longer terms.” Continue reading In-store credit proving to be a boon for retailers

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February 2012 — Surfaces 2012: Optimism, steady traffic take center stage

Volume 26/Number 16; Dec. 17/24, 2012

Hanley Wood, Surfaces’ owner, claimed a 10% increase in attendance at the 2012 event, while participants noted steady traffic throughout the three-day event. For the first time in years, Surfaces held a feeling of renewed optimism for the flooring industry

“You could tell something is changing and the overall mood of the people was better,” said Scott Levy, executive vice president of operations for Scranton, Pa.-based Arley Wholesale, a tile distributor. Continue reading February 2012 — Surfaces 2012: Optimism, steady traffic take center stage

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Floating luxury vinyl category grows as market opportunities soar

Proliferation of new suppliers runs the risk of commoditization

Nebraska Furniture Mart is pleased with the top brands it carries in the floating luxury vinyl tile (LVT) category—among them Mannington, Armstrong and Karndean—but that hasn’t stopped manufacturers from contacting senior flooring buyer David Snedeker on a regular basis. “There seems to be someone new—or at least new to me—calling every week with versions of their latest and greatest LVT.”

During the long economic downturn, few, if any, hard surface categories demonstrated the promise and robustness as vinyl, with LVT the leader. The popularity of glueless LVT and its various click systems has produced a swath of new entrants, some with little or no flooring experience. “We’ve seen furniture manufacturers getting into the market,” said Yon Hinkle, product manager, residential tile, Armstrong. Continue reading Floating luxury vinyl category grows as market opportunities soar

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Cissell leaves NFM

Gary Cissell

Omaha, Neb.—Ronald Blumkin, president of Nebraska Furniture Mart (NFM), has announced that the company’s flooring division has undergone “a leadership reorganization.” As part of the change, he noted, Gary Cissell is no longer with the company.

Longtime employee and senior flooring buyer David Snedeker will guide the division’s day-to-day operations until a permanent replacement is named, said Blumkin. Snedeker will continue to “support the organization’s comprehensive strategic plan and position the firm for continued growth.” Continue reading Cissell leaves NFM

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Credit: How to upsell the customer every time

by Ken Ryan

Ken Weisbacher, owner of Carpetland Carpet One in Cincinnati, remembers the time when five-year financing terms were the norm in the flooring industry and provided the impetus for dealers to upsell consumers.

That sweet spot has been reduced to 12 months (on average) or 18 months during the economic downturn, according to Weisbacher and others, who noted the use of financing is still very important, albeit less prevalent than a few years ago. Continue reading Credit: How to upsell the customer every time

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Optimism, steady traffic take center stage

Improving economy gives show best feeling in years

by FCNews staff

Las Vegas—Immediately after the curtain was raised on the stage that was Surfaces 2012, it was apparent to everyone from manufacturers to contractors to retailers that something was different in the air at the Mandalay Bay Convention Center. Continue reading Optimism, steady traffic take center stage

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Surfaces 2011: Move to Mandalay finds favor with exhibitors, attendees

LAS VEGAS—If Surfaces 2011 serves as a bellwether of the flooring industry for the coming year, then the industry has plenty to look forward to in the months ahead. Most exhibitors had nothing but good things to say about the show, the move to Mandalay Bay and the quality of traffic. Retailers also took a liking to the new venue as well as the layout. Continue reading Surfaces 2011: Move to Mandalay finds favor with exhibitors, attendees