Flooring America Re:2011 centers around what is important to members

Home Inside FCNews Flooring America Re:2011 centers around what is important to members

GRAPEVINE, TEXAS—Rejuvenate. Refresh. Restart. Revamp. Just a few words that embody the theme of Flooring America’s 2011 winter convention here dubbed Re:2011. Specifically, members were asked to Re:boot, Re:think and Re:act to the ways business is done today in retail flooring.

“Re:2011 is about recommit- ting, reinvesting, re-energizing and revitalizing our members,” Vinnie Virga, president of Flooring America told FCNews. “We’re finally moving out of survival mode and moving forward with a three-year plan that will aggressively take market share.”

Virga said it was going back to the traditional way of doing business that was abandoned before the economy dropped out. “Going back to the old way of business is a sign of our optimism for the future but with a little tweaking,” he explained. “[Setting] a three-year-plan seems just right [as opposed to the usual five-year-plan], especially with the changes in the digital revolution and consolidation of hard surface mills. Who can say where we’ll be in five years?”

This convention tapped into the entrepreneurial spirit of the members, Virga said, who used Warren Buffet as an example. “He’s greedy when others are fearful, and fearful when others are greedy. He finds the right time to invest, which is why he’s so successful. Our members have to do the same; they have to act now and invest for market share.”

Jim Duff, president of Flooring Canada, echoed those sentiments while urging members to take charge of not only their businesses but also their attitudes, saying 2011 was the year to make things right and move forward better prepared after experiencing some of the most challenging conditions in industry history longer than expected.

“Today’s challenges need to be met with today’s strategy,” Duff advised. “We need to have our A-game. Your team has to be at the highest level of performance in all areas.”

Also motivating members was guest speaker Chris Gardner, the man whose life inspired the major motion picture, “The Pursuit of Happyness.” Relaying personal experiences of hardship, he impressed on members the importance of perseverance and personal strength that carried him through the transition from homelessness to professional success.

New products

Three major initiatives appeared on the product front at Flooring America’s winter convention, all of which were under proprietary labels. “It is a fact that consumers today expect more than they ever have,” said Randy Upson, vice president of merchandising, Flooring America/Canada. “We’ve taken an approach with our wood and laminate department where less is more. We’ve gone very brand specific so she can easily shop our brands and know what she’s looking at. Identifying that at point of sale was our first goal.”

To achieve that, Flooring America softly introduced Downs Performance hardwood in the summer of 2010 but went full throttle here with product ready to ship in several weeks after a member-recommended refining, Upson said. “It’s a full, private-label, private-branded program designed to perform under tough conditions. Supplied by Armstrong, the products feature its new finish on which we have an exclusive for a while.”

The next hardwood advance is a wood collection supplied by Mohawk under the Design Distinctions brand. A rustic, handscraped collection in 40 SKUs is also housed in the Vision display with the wing format. “When the members saw the performance collection they were a little disappointed and wanted more of these rustic looks,” Upson said. Domestic species of hickory, ash, birch and maple are anticipated to hit the market in mid-April. With the introduction of the Downs Performance and rustic wood collections, Flooring America enhanced warranties up to 50 years.

The co-op also sharpened its focus on its laminate department by initiating phase one of a full category revamp. Sup- ported by Armstrong under the Design Distinctions brand, Flooring America plans to keep 33 of the best selling SKUs currently in the field and add 26 more. “This will present more high-style products in a combination of wide and narrow planks, square edges and beveled edges, different levels of piano finishes, from 7mil up to 12mil,” Upson said. “These will not be commodity price points; more middle to upper-middle.”

The Downs brand also received a repositioning and enhancement on the carpet side. “It has always been about the stain story, but now we’ve interjected soft fibers into Downs,” Upson explained. Half the collection will transform to soft fibers now and within the next six to 12 months the full collection will make the transition. “Our Downs broadloom has always had the strongest stain story in the industry; we’ll maintain that along with soft fiber technology.”

“Our second goal was to introduce the best products that hit different looks and price points by providing exactly what she needs,” Upson explained. “We need to make sure our collection is really good but not necessarily big. By private labeling and branding, we’ll provide a better shopping experience that will help members pick up additional profit and close more sales.”

New programs

Members were excited by GE Money’s S.C.O.R.E. (Selling Credit Offers Retail Earnings) Training and Incentive program. Designed to help sales associates retain information and get the most out of GE’s programs, it also helps members share information and replicate success, said Bill Wissler, vice president, national programs.

“We’ve spent a lot of time training our members but we’ve never been able to quantify how effectively that knowledge has been transferred to the sales staff,” he observed. “[With this] we’ll be able to really benchmark their progress from the fourth quarter and compare them to the results after training to figure out if it was really successful. From there we can make necessary adjustments.”

GE was also supportive of the initiative. “The plan is available to a limited number of members and we’re thrilled with the response after the first day [of convention],” said Nia Evans, senior industry marketing manager, sales finance. “I hope this makes a difference for the members.”

The Inventory Finance program, an industry first, is one that also generated a lot of excitement. “We feel it provides significant benefits to both our manufacturer partners as well as membership,” Wissler said. “Inventory finance or floor planning has been a part of doing business in the consumer electronics, appliance and HVAC industries for decades.” Now it is floor covering’s turn. “Members who weren’t inventory buyers before may find it easier to take advantage of that where they weren’t able to do before.”

From a manufacturer perspective, the benefits include a central billing source rather than billing each member individually, guaranteed payment in as few as three days, transfer of credit risk, and the ability to offer extended dating so members can affordably carry more inventory.

Member benefits include extended credit terms, increased prompt pay discounts, improved cash flow with credit terms that match inventory terms, an interest-free line of credit, and a central platform to manage accounts payable.

Members were also introduced to Optimum Expense Recovery, a program that looks at the cost of waste removal, utility bills and many other daily business expenses. A Check Guaranty program with United Tranz Actions was also highlighted.

-Emily Hooper

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