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My take: The ins and outs of innovation

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

By Steven Feldman

 

Innovation. It’s more than a buzzword; it’s basically a blueprint for survival in the face of competition. Talk to any manufacturer, and most will tell you their ability to innovate is what sets it apart from the pack. Whether it’s a product like Air.o from Mohawk; a new locking system from Unilin, Välinge or Innovations 4 Flooring; a novel dyeing process; or some new wrinkle in the waterproof flooring category, innovation is truly the name of the game.

It’s a phenomenon not unique to flooring. Every company in virtually every industry must innovate, the success of which is predicated on a company’s ability to convey the benefits to end users and why this innovation truly matters.

I was reminded of this the other day as I was reading an article on innovation in the adult beverage industry. Back in 2013, the vodka category was beginning to go through a real identity crisis. For a while, the major innovation was flavored vodkas. Believe it or not, the first flavored vodka to hit the market was Absolut Peppar in 1986, seven years after the birth of the Absolut brand. But nearly 30 years later, the flavored vodka boom was ending, and vodka companies were scrambling to figure out ways to hold on to their growth and still remain relevant in a marketplace that was increasingly shifting toward whiskey. This sort of parallels carpet’s position as the marketplace had been shifting in the direction of hard surface since the turn of the 21st century.

Grey Goose was one of those brands that was really trying to navigate these changing vodka waters. In 2013, Bacardi, which owns the Grey Goose brand, saw a 5% decline in sales. Part of this falloff was attributed to Grey Goose’s decision to not chase the flavor trend too hard, but a more significant factor was unexpected competition from non-premium brands like Tito’s Vodka, which took significant share away from premium players like Grey Goose. For our industry, the parallel could be Royalty Carpet Mills, which saw its market share erode in the face of competition from new mills like Engineered Floors, Phenix and Lexmark Residential, to name a few. Royalty did not chase the hard surface business, either.

The problem with the vodka category, and its players, was it had enjoyed such effortless success for decades with very little need for innovation. Sort of like carpet not facing any appreciable hard surface competition until the mid-1990s, when laminate hit the scene and hardwood and ceramic became more readily available to the masses. While carpet was not going to lose its dominance to any one hard surface category, the landscape was clearly changing, and mills really had no maps to navigate the road ahead.

What Grey Goose did with VX was akin to what Mohawk has successfully done with Air.o, which looks and smells like carpet but is billed as Unified Soft Flooring. Grey Goose VX isn’t technically a vodka: the Alcohol and Tobacco Tax and Trade Bureau slapped a “spirit drink” classification on the brand and bottle. Grey Goose VX is essentially Grey Goose vodka finished with a hint of cognac. The bottle does disclose that it’s a blend of 95% vodka and 5% cognac, the same ratio that’s common with spirit whiskey.

Grey Goose VX infuses some of the flavors that cognac offers without fundamentally disrupting the vodka experience. Sort of like Mohawk improving some of the attributes of carpet (health, installation, etc.) without disrupting the carpet experience.

The important thing to keep in mind with any innovation is pricing. The end user must see the value. The big problem with Grey Goose VX when it launched was the price. Given that Grey Goose vodka typically sells for around $30, the leap to $75 a bottle for Grey Goose VX was pretty dramatic. It begged the question, “Why not spend the money on a good cognac instead?” Once ultra-premium vodka leaves the $40-$50 price point, there’s a real question over what you’re really paying for. We saw that with laminate not too long ago. As manufacturers innovated to improve style and performance, the price could reach a point where the consumer could purchase real hardwood.

Innovation is a requisite for success. But it must be well thought out and provide a solution—at the right price.

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Royalty Carpet Mills closes its doors

Screen Shot 2017-06-14 at 2.45.30 PMRoyalty Carpet Mills, a West Coast carpet manufacturer for nearly a half-century, has abruptly closed its doors and ceased operations, effective immediately, FCNews has learned.

An automated voice message left on the phone system at the mill’s headquarters in Irvine, Calif., notifies callers that “effective immediately” Royalty Carpet Mills, Camelot Carpet Mills, Moda LLC and PacifiCrest Mills “are closed and will not reopen.” Furthermore, several industry sources have confirmed that Royalty’s territory managers have been instructed to call customers and tell them to “throw away” their Royalty samples.

Royalty Carpet Mills, founded by industry icon Mike Derderian in 1969, carved out a legacy for creating and producing high-quality carpet products. When Derderian passed away in 2013 at age 87, his daughter, Andrea Greenleaf, took the reins. Greenleaf had been running PacifiCrest, its commercial division, for the previous 20 years. With Greenleaf at the helm, Royalty became the only female-owned and led carpet mill in the U.S.

FCNews will have more on this story in its June 19/26 issue.

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Greenleaf talks Royalty intros and initiatives

Moves in 2014 shed positive light on year to come

January 19/26, 2015; Volume 28/Number 15

By Jana Pollack

Screen Shot 2015-01-19 at 3.45.03 PMIt’s been 18 months since Andrea Greenleaf became president of Royalty Carpet Mills, and much has changed at the mill, and that goes way beyond a complete remodeling of the company’s Irvine, Calif., headquarters. Changes include the acquisition of new equipment, the launch of more than 50 new styles and the development of new, valuable relationships.

“2014 has been exciting at Royalty,” Greenleaf said. “With new branding, a new display and a group of great product introductions, the company hit the ground running. Although all of those initiatives were challenging and took a while to put in place, the company is now seeing the investments pay off in the form of improved sales, and we believe the toughest parts of the transition are behind us. Going forward our main focus will be on making sure our dealers are familiar with everything that was introduced.”

In addition, Royalty recently introduced a new merchandising system called Genesis. Greenleaf described the Genesis display as a high quality, high performance fixture that incorporates a video screen. “The concept, signage and flexibility of the screen, as well as the photographs, are new to our industry.” She reported a positive reception to Genesis with more than 1,000 displays placed across the U.S. and Canada. “As fashion forward as our display fixture is, I believe the many new style introductions have made it an effective sales tool.”

Royalty also purchased three new state-of-the-art machines this past year, which have been fully utilized in production. “Our design team has developed, and continues to develop, styling that takes full advantage of everything these machines have to offer,” she noted.

The introductions that Greenleaf referred to are vast: More than 50 new styles have been launched over the last year. However, she continues to look to the future, adding that Royalty’s introductions at Surfaces will be both mainstream and uniquely styled. Pet Protect, a carpet with built-in stain resistance that provides a breathable moisture barrier while using proprietary technologies and chemistries to reduce the force of attraction between pet hair and the carpet, will be an additional launch at the show.

Another significant change that occurred during 2014 for Royalty was a decision to part ways with Home Depot. When asked about the choice to walk away from the retailer, Greenleaf stressed that it was an amicable split. “There are times when two companies do not meet one another’s current goals, but that is always changing.” She went on to say that while Royalty has not yet ceased doing business with Home Depot, it is not currently implementing any new combined programs.

The family of brands

Royalty currently markets three brands: Royalty, Camelot and Moda. According to Greenleaf, Royalty is the “mother ship. It’s the brand that can meet our customers’ needs, from multi-family to sophisticated patterns. In addition, Royalty has a history of offering up-to-date styling, unequaled quality and superior service that our dealers can count on.”

Camelot, which was acquired in 1999, serves as the upper-end line. The brand primarily features Stainmaster fiber, aesthetically appealing patterns, higher-end cut piles and a family of multi-tone loop patterns. Mademoiselle was recently introduced to the line, which incorporates various yarn sizes, and luster and dye levels into a high-end TruSoft style. This offers a pallet of 36 colors, including many jewel tones.

While Camelot and Royalty have operated in conjunction for 15 years, Moda was acquired this past October. Greenleaf said she did not anticipate the purchase, but it seemed like the perfect opportunity when it arose. “The Kazarians, who owned Moda, have always been close with my family. As it happens, there was a change in ownership with Moda’s manufacturing partner, and the Kazarians and I happened to have lunch around that time. We pretty much decided that selling Moda to Royalty was in the best interest of everyone involved.”

She went on to praise Moda, saying it has been a leader in carpet styling since its inception. She also spoke highly of its people. “While the Moda brand does bring growing sales and a beautiful product line, I also consider its people to be its greatest strength.”

Greenleaf added that she intends to remain invested in all three brands. “My plan includes further definition and growth for each brand within the marketplace.”

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Andrea Greenleaf: Maintaining a legacy

October 13/20, 2014; Volume 28/Number 9

Leading family-owned mill on the path of continued success

By Jenna Lippin

Screen Shot 2014-10-31 at 10.30.53 AMSpearheading a revamp of Royalty Carpet Mills that began last year, Andrea Greenleaf has developed a respectable reputation of a no-nonsense businesswoman and leader in the flooring industry as president and CEO of the company. She was thrown head first into this leadership role after Greenleaf’s father, Royalty founder Mike Derderian, passed away last year.

Although Greenleaf ascended to the top spot last year, she was certainly not new to the company. In fact, she joined Royalty’s team in 1972, just six years after the company’s inception. However, after doing regular office tasks and working at the order desk, she decided her niche was not in carpet. So, in 1978 Greenleaf left Royalty to earn her gemologist degree.

“I’m a gemologist at heart,” she said. However, after about 12 years working in her preferred field, Derderian approached his daughter about returning to the family business.

“My father called in 1992 and said, ‘I think it’s time you stopped fiddling around with gems and came to work here.’ I started laughing because I thought he was joking, but he wasn’t. He said he needed someone in the family to come into the business, and I guess I was that person.

“That’s the only thing that drove me to leave a career I was perfectly happy with,” she continued. “My father built something from nothing, and I didn’t want to let that fall by the wayside. I came in and got involved on the commercial side, and with corporate issues, legal aspects, insurance, etc.”

When it comes to Greenleaf’s position as a female in a male-dominated industry, she believes gender isn’t the main issue. The flooring world itself is a challenge, she said, and constant innovation and development is imperative to remaining relevant. “[Flooring] is a bit cutthroat,” she said. “I think the carpet industry as a whole should do more to improve the products it delivers so consumers are happy with their carpet selection, and not look to hard surface because the carpet does not hold up. We need to improve our product quality so we can give the value [consumers are] expecting. People want value for what they are purchasing, and it’s up to us as an industry to provide them with that value.”

So, how does leading a carpet mill compare to working as a gemologist? “Jewelers can be difficult, too,” Greenleaf said. “There are challenges you face in all businesses, whether you are a man or a woman. I think we need to constantly strive to improve our industry.”

What has helped Greenleaf avoid some of the obstacles women face in a male-dominated business is her straightforward attitude. Her reputation as a direct, respectable, knowledgeable industry leader has allowed her to do business efficiently and with confidence.

“I can be somewhat intimidating,” she admitted. “But I don’t necessarily mean to be that way. I’m very direct. I’m not a good chit chatter. I know what I want to achieve, but I’m always willing to listen to other opinions; no one is right all the time. I’m just a bottom-line person. I’ll talk to a customer and say, ‘What do I have to do to get more business from you?’ I just want to get to the point. With customers, I just need them to tell me what I need to do to make them happy.”

Screen Shot 2014-10-31 at 10.31.50 AMWith that, she has universal goals and foundations for relationships, regardless of gender. “The men in the industry I’ve talked to, the other mill owners, have all been very pleasant. I haven’t really faced any issue with men specifically. I’ve made calls to customers, I’ve met husbands and wives who run companies—they are open. It doesn’t matter one way or the other that I’m a woman. My message is, ‘Listen, [Royalty is] a woman-owned company manufacturing in California. We need to take care of each other.’ And that’s kind of a big deal, that we are woman-owned, because that makes us a minority in the world of business. I think women-owned companies should promote that as much as they can. It helps with some people, but others just don’t care. They just want the nicest product.”

If you ask Greenleaf what kind of advice she can offer women trying to earn a reputation as prestigious as the one she holds, she advises simply being yourself. Admitting to mistakes and realizing you won’t win with everyone are key points to acceptance in any industry, whether you are male or female, in gemology or flooring.

“I think for women in general, you need to understand that in some cases you will have an uphill battle; in some industries you will be met with resistance,” she explained. “You need to be yourself first and foremost. You can’t be what other people want you to be. But you must be willing to adapt, be flexible, and you must be willing to fail. Everybody makes mistakes. If you think you are perfect all the time you are setting yourself up for disappointment. You learn from mistakes and you grow. That’s how you become more accepted. You accept blame, move on and move forward. You have to be prepared to take the pits along with the cherry, and sometimes there a few more pits than you expected.

“A good support system is also very important. I was lucky to have a very supportive husband and I think family support is critical to success in any venture.”

For the flooring industry in particular, Greenleaf does, in fact, see an advantage to being a female as she herself is her target consumer. To have a perspective of what’s important from the inside helps develop and provide the products shoppers are seeking. “The shoppers of home products—whether carpeting, paint, furniture—are women. Most of the time it’s not the husbands making these selections. I have a great team of people here, women and men, working to make a great product line. As a woman owner I bring a different perspective because I know what it is like to do the shopping for the home, and know what I want to see. For the most part, men leave this process up to their wives or girlfriends. Being the manufacturer as well as the target consumer can offer us an advantage in the marketplace.”

As a leader and a target customer, the focus for Greenleaf today is what she can do next to help Royalty continue to grow and stand out from other mills. The company has recently completed the acquisition of carpet company Moda, which will help further expand its relationships in the industry. “I’ve known Don and Ken Kazarian [principals of Moda] my entire life, so it’s like bringing more family into the business. I’m very excited; I think it will be a big plus for us.

“I would like to develop long-term partner relationships,” she added. “I’m not interested in one-off deals. We have to develop good, strong relationships with customers that we can sustain, especially in California [where Royalty is based]. It’s a horrible economy here. We need to work together to not only keep our business healthy, but also to keep business viable in this state. I’m very optimistic about the future, that’s for sure.”

Royalty has plans to launch “unique and interesting products” at Surfaces 2015 thanks to two newly acquired machines and a third on order.

Continuing to look ahead, Greenleaf hopes to fulfill the vision her father had for her and Royalty as a whole. “My father had enough faith in me to leave the business to me to run. That was quite a compliment. I’m very proud of the people here at Royalty who have helped me turn the company into what it is today. I’m proud of what Royalty has been in the past and what it can be in the future.”

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Royalty's Paul Engle retires

Screen Shot 2014-05-29 at 3.23.38 PMIrvine, Calif. — After 38 years of dedication and commitment to Royalty Carpet Mills, Paul Engle has elected to retire and begin a new chapter in his life.

Engle combined his expertise and knowledge of the carpet industry, especially of the Royalty brand, with distinctive loyalty and congeniality. This unique blend made Engle a one-of-a-kind person in the flooring industry as well as a valued member of the Royalty family.

“We are all extremely grateful to Paul for his allegiance to my father and Royalty, and for all his hard work over the years,” said Andrea Greenleaf, president/CEO of Royalty Carpet Mills. “We wish him the very best with his future plans. If those happen to include a consultant opportunity at Royalty, the door is always open.”

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Comfort priority for cushion, underlayment manufacturers

September 2/9 2013; Volume 27/number 10

By Louis Iannaco

Screen Shot 2013-09-09 at 4.57.16 PMToday’s underlayment and cushion manufacturers are currently focused more than ever on comfort. Whether it’s cushion for broadloom or underlayment for hard surface flooring, mills are producing quality product using state-of-the-art technology with end users’ comfort being top of mind. Continue reading Comfort priority for cushion, underlayment manufacturers

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Royalty Carpet Mills: All in the family

Andrea_RoyaltyCamelotCMYKWhen industry icon Mike Derderian passed away a few months ago, Royalty Carpet Mills lost the only leader it had ever known. But his successor—his daughter, Andrea Greenleaf—had been running PacifiCrest, its commercial division, for the past 20 years. With the dynamic Greenleaf now at the helm, Royalty becomes the only female-owned and led carpet mill in the U.S. FCNews publisher and editorial director Steven Feldman recently sat down with Greenleaf to discuss the company in general and her plans for the future. Continue reading Royalty Carpet Mills: All in the family

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Royalty names Greenleaf president/CEO

Royalty_Logo_CMYK.tifIrvine, Calif.—Royalty Carpet Mills has announced Andrea Greenleaf as its new president/CEO. Greenleaf, who is honoring the influence of her father and company founder, Mike Derderian, stated, “My father used to say ‘be a leader, not a follower, and never look back—don’t stop moving forward.’ That day has arrived and in his honor, I intend to stay true to his vision of keeping Royalty competitive as a high quality brand with superior value products. My first steps were to chart a new course with an updated brand ID and several new product introductions.” Continue reading Royalty names Greenleaf president/CEO

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Mike Derderian, 87

Founder of Royalty Carpet Mills

Mike Derderian

Irvine, Calif.—Mike Derderian, the founder of Royalty Carpet Mills, passed away on April 4. He was 87.

Derderian founded the West Coast mill in 1969, 10 years after entering the flooring industry as a salesman for Georgia distributor Wm. H. Green Co. His strong sales skills landed him an offer with Dalton’s Purvis Wade Carpet Mills to be its exclusive West Coast sales agent.

Derderian not only accepted the offer, he launched MD Sales Agency, hired three salespeople, four office employees and brought the  agency to a 13,000 square foot warehouse in City of Commerce, Calif. The company grew so quickly Purvis was unable meet the needs of his California clientele. Continue reading Mike Derderian, 87

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Manufacturers debut offerings for spring season

By Jenna Lippin

Volume 26/Number 22; March 18/25, 2013

While we are only a few months into this year, there already is a renewed sense of optimism. Surfaces has quickly come and gone, but this does not mean opportunities are over for manufacturers to showcase new goods. Some are revamping existing lines while others are unveiling brand new designs. Continue reading Manufacturers debut offerings for spring season