By Steven Feldman
Volume 26/Number 24; April 15/22, 2013
Beaver Creek, Colo.—Phil Koufidakis, co-owner of seven-store Baker Bros. in Arizona, began his first meeting as National Floorcovering Alliance (NFA) president by reminding the 42-member organization of their primary duty: to serve, as it is a group run by the group and for the group. And by the time the meeting was over, he had announced the restructuring of NFA committees to involve more members.
“The executive board felt strongly that more people needed to be involved in driving the entire group,” he said. “Too many people are not participating. The power of this group is based on the power of the people in this room. We can’t have 20% of the people doing 80% of the work.”
With that, the course Koufidakis charted begins with the restructuring of the general committees: commercial, roll buy, website, long range planning, best practices, membership, financial, ethics and advisory were eliminated. “Those were all built for a time and place, and that time has passed,” he explained. “Many of those functions are already carried out by the board.”
Instead, there will only be seven product committees and a marketing committee, each consisting of a chairman and between three and five members. Specific tasks will be assigned to each individual within the committee. For example, one person will be responsible for specialty vendors, while another will be charged with co-op and promotions.
“Everyone’s responsibility will be upwards and downwards in the chain,” Koufidakis said. “We have a lot of incredibly smart people in the room, and we are not using these incredibly smart people. It will be simpler and cleaner. This is about pulling everyone in the same direction.”
Koufidakis is not only looking for participation within the group. He also hopes to attract more suppliers to NFA’s specialty vendor meeting, which is held on the afternoon before Surfaces. “We must do a better job of recruiting vendors that will benefit both members and vendors. It’s everyone’s job, so members will be designated to approach vendors based on category.”
Managing vendors’ expectations from day one may be the best and easiest method for recruiting suppliers. “Some thought 42 NFA members were going to come in and give them a purchase order,” Koufidakis said. “Maybe we put together a prospectus. ‘Here’s how the systems works, here’s who you will be meeting with.’ We also must explain that this is much more cost and time effective than if they tried to visit each one of us individually.”
Members had a series of ideas on how to improve the experience for both sides.
Sam Roberts, Roberts Carpet and Fine Floors, Houston, suggested the group put together a marketing package and target every supplier who is not among the NFA’s 25 core vendors. Jon Pierce, Pierce Flooring and Design in Montana, believes the group should seek to attract companies that specialize in peripheral areas like training, marketing, technology, installation and loyalty programs.
The third initiative on NFA’s agenda for 2013 involves the potential consolidation of some of its existing private-label brands under one umbrella, a yet-to-be-named brand that would cross product categories, and vendor partners. Such a program would be beneficial throughout the chain:
• Vendors could gain critical mass.
• Consumers across North America would see a consistent message.
• NFA members would gain more control of the group’s future.
Jeff Macco, Macco’s Floor Covering Center, Green Bay, Wis., may have summed it up best: “It is paramount we move forward with a brand we own. We are the best flooring marketers in the U.S. We know how to advertise and market better than anyone. Once we build that brand strategy, vendors will be lining up. This is one of the most important things we can do to protect our bottom line.”
Koufidakis warned any potential brand NFA may one day have will not become Kleenex overnight. “But if we harness the power of the group, we can build a brand over a period of years.”
The last item on Koufidakis’ agenda is bringing members closer to each other and to vendors. “As we have grown, we have lost some of our intimacy. The goal is to regain that.” He believes the restructure of the committee will allow members to have more interaction with those within the committee and within the board.
He is also seeking to regain some closeness by limiting membership “We are not actively pursuing new members. We’d look at someone if they are interested, but we are only looking to grow with a retailer who adds something to the group.” What’s the perfect number of members? “42,” he said, which happens to be the roll count right now.
As for getting closer to the vendors, he believes it’s about giving members presentations around which they can wrap their arms. “The vendor meeting two days ago was perhaps the best we ever had. More vendors came prepared to give the members a tremendously concise presentation we could embrace. Vendors are listening more and acting on the information they get. In the past they used to push their agendas. This will be beneficial for both sides going forward.”
As an example, he cited the SmartSolutions Hard Surface program from Mohawk.
“Our relationship with Mohawk has done an amazing 180-degree turn from where it was four years ago. Now we have a platform going forward for Mohawk and the group. It started as carpet and now hard surface is being added under the same brand.”
This meeting also served as the first for NFA’s newest members from ICC Floors, Indianapolis. Owners Cam Haughey and Nate Roberts were college fraternity brothers who served in various industry roles before opening up a retail store in 1998.
“This experience has been great,” Haughey said. “You are with a bunch of guys facing the same issues you are. We have heard lots of great ideas, and hopefully we can provide some, too.” He was particularly excited about the vendor meeting, where NFA members spend a day with core vendors in a speed dating format. “We got more done in that day than we do in three days at Surfaces. It would take a month for all those suppliers to come into our showroom. And often you talk to your rep who has to talk to the guy who has to talk to the guy. Here you are talking to THE guy.”
Something Roberts found beneficial was NFA’s famed “2-Minute Drill” where members share best practices. “I like that it is a very structured, open forum for the members to share ideas. I wrote down 10 marketing methods we have never tried.” He specifically cited the technique of listing cost-per- month on price tags as opposed to price per square foot. “People are in the payment mindset. Before the government took away the no payments tool, consumers would buy flooring and worry about paying later. Now they can buy product and know what they have to pay per month. It’s been a successful strategy in the furniture industry.”
Consumers are, in fact, spending money. Sales have increased for NFA members over the last six months for various reasons. Among those expressed by members were the return of builder business, new store openings, the recovery of the real estate market, the oil boom in eastern Montana and western north Dakota, diversifying into new products, and special promotional buys.
But that doesn’t mean members are without challenges. During the 2-Minute Drill they were asked to reveal their biggest impediments to growing their businesses. The overwhelming consensus is that labor is a big issue.
“Where we have good salespeople we do extremely well,” said Steve Brannen, Carpet King, Minneapolis. “Where we have weak salespeople we struggle. In response, we switched from a single sales manager responsible for all 14 stores into two district sales managers.”
At the four-store Flooring 101 in Ventura County, Calif., Ian Newton, general manager, noted, “There’s not a big pool to draw from to attract qualified salespeople. We are using technology to train inexperienced salespeople to become flooring salespeople.”