My take: Northeast Floorcovering Market exemplifies NRF success

Home Editorials My take: Northeast Floorcovering Market exemplifies NRF success

Markets. There’s Surfaces. There are the buying groups. Shaw and Mohawk host countless regionals of varying scales in January. Let’s not forget the associations. In fact, two weeks ago I stumbled upon the Washington State Floor Covering Association market 30 minutes north of Seattle that filled approximately 80 display spaces.

And often lost in the shuffle are distributor events. Some hold their own mini-markets, others who share a geographic region may partner for a larger event. But the granddaddy of them all has to be NRF’s Northeast Floorcovering Market (NEFM), now more than 30 years old.

The show evolved from a warehouse event in Augusta, Maine, to a grand affair at the Mohegan Sun casino and conference center that now draws upwards of 1,000 attendees. This is no surprise given the fact that NRF services eight states.

But the NEFM is not all that has evolved. Much has changed at NRF over its four decades, growing from around half a million dollars in sales to about $130 million. Amidst all the change, the one constant has been a business model built around customer service. That’s probably because owner Norman Pomerleau’s (the “N” in NRF) roots are firmly implanted in retail. In fact, it was a major retailer dilemma that led him to become a distributor.

Norman couldn’t stand buying a piece of vinyl or carpet and having to pay different freight rates. Back then, he had no idea what to charge the customer because the manufacturers put everything on an LTL (less than truckload), and the retailer had no idea of the delivered price on anything.

Realizing the need for distribution, he bought a truck, hired a salesperson and delivered for one flat rate. Perfect solution. However, retailers were skeptical. They always seemed to think twice before buying from another retailer.

They soon realized NRF provided a valuable service. At that time, mills did not have the inventory they do today. Retailers would wait as much as three weeks to receive cuts if they were out of stock.

Interestingly, the retailers NRF serviced were located up to six hours north of its Augusta headquarters. And therein came an epiphany. “I was sitting in Augusta five years after starting the distributorship, realizing we are driving six hours to service retailers at the top of Maine. I wondered what would happen if we drove six hours south.” That opened about 10 times the number of customers it was originally servicing. NRF was now in Massachusetts and New Hampshire.

Everything was fine until Bob Shaw called one day, informing Norman that Shaw Industries would be selling direct, and other mills followed suit.

Undeterred, Norman continued sell carpet while other distributors abandoned the product. He even continued to sell Shaw. The model was to buy truckloads to get a better price and save on freight. A strong service component allowed NRF to command a slightly higher price than the mill.

At the end of the day, Norman was not going to walk away from a product that commanded such a large market share. In fact, carpet remains about a third of NRF’s total sales volume.

But with the mills going direct, NRF had to do something. That something was expanding into all types of products—wood, ceramic, laminate and more. “We’re like a country store,” he said. “We have everything you need.”

One of the biggest changes for NRF occurred in October 2011 when it ended its 30-year relationship with Mannington and began one with Tarkett. While Norman admits it may take a year or two to equal the sales volume it was doing, he is pleased at the current pace. He has nothing negative to say about his former supplier; in fact he’s quite complimentary. But then the dust settled and he felt Tarkett simply provided more freedom in terms of the lines NRF could carry.

At a time when many distributors struggle with the industry’s dynamics, it’s nice to hear a success story.

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