October10/17, 2016: Volume 31, Number 9
By Steven Feldman
Palm Beach, Aruba—Against a backdrop that some say is only rivaled by paradise, the 42 retailers that comprise the National Floorcovering Alliance gathered here recently for their semi-annual summit to celebrate its silver anniversary. And the next 25 years will begin the way the first 25 ended: with Dave Snedeker, division merchandise manager, Nebraska Furniture Mart (NFM), as president after being elected to a second term. Should Snedeker serve his entire two-year term, he would become the first NFA president to serve four years since Gary Cissell, who coincidentally served in the same capacity at NFM as Snedeker.
As for the rest of the board, Jim Walters, Macco’s Floor Covering Center, Green Bay, Wis., was elected vice president; Ian Newton, Flooring 101, Ventura County, Calif., was elected treasurer, while Kelly Taylor, Ambassador Flooring, St. Louis, remains secretary. Ryan Bechtold, Contract Furnishings Mart, Portland, Ore., and Zac Akin, Akin Bros., Oklahoma City, will serve their last of three years as board members at large.
When asked what this board’s goals are for the next two years, Walters told FCNews the idea is to build on the accomplishments of previous boards in terms of vendor programs that bring value to the group: “More exclusive products and programs that can give us an edge in our respective marketplaces.”
He has also been impressed with the heightened level of member activity. “People are bringing things to the table. The goal for the next two years is to get even more of the membership engaged.”
Snedeker said his goal for the next two years is to continue to gain a better understanding of what the members need to better their businesses. “For example, [this year] we asked what type of speakers members would want at the next meeting. Many said they wanted to hear about the millennials. Ironically, we already had that planned for this meeting with a presentation from Armstrong that addressed the three customer groups: baby boomers, Generation X and millennials.”
Some key takeaways from that presentation:
Millennials as a group will demand serious attention going forward. Born between 1982 and 2003, they just started to enter flooring market. This group will be the key shopper of the future. How soon? By the end of 2017, they will surpass Generation X in terms of buying power. By 2025, their combined income will represent 46.6% of this country’s buying power.
A couple of things retailers must understand about how millennials shop and buy:
- This is the first generation to grow up with the Internet. They are online 24/7. They are always connected, always sharing. They take charge of the shopping experience and see retailers as service providers. They demand an integrated, seamless experience regardless of the channel. They transition effortlessly between online and in-store.
- Millennials shop digitally but buy locally in brick-and-mortar stores. They want knowledge and advice from trusted retailers. So the challenge centers around how to get them in retail stores. Social media is where they are going for referrals and reviews that bring them into the store. So retailers must use social media to start and maintain the conversation. It starts with relevance—providing the right information to make a decision.
Jeff Macco, Macco’s Floor Covering Center, Green Bay, Wis., thought the presentation was the highlight of the meeting. “Millennials may not be as critical to us today, but five to 10 years from now that’s going to be our No. 1 customer base. They don’t shop like we’re used to, so we have to adapt and figure out how to reach them and change our marketing to be where those people are looking. I learned that it’s clearly Internet based, so the challenge is how to target our Internet marketing to attract that individual to our stores.”
Other issues that have come up repeatedly are installation and human resources—specifically finding, attracting and retaining talent and increasing their engagement. Two best practices presentations addressed this: Michael Longwill, Airbase Carpet Mart, New Castle, Del., talked about the importance of structured meetings to build employee engagement, while Larry Flick, The Floor Store, Northern California, discussed ways in which he incentivizes installers.
Longwill’s presentation drew rave reviews from fellow members, specifically as it related to the discipline of frequent, short meetings at consistent times with a clear agenda. “You should be constantly getting information and feedback that support your mission and values,” he said. “It’s having open, transparent communication up and down the chain. It’s a culture and value system that you have to advance. And the pace that you do them is the pace the company will grow.”
Longwill said it is important to have “daily huddles” in your store, where everyone gets together and discusses the plan for the day. “It could be 3 minutes; it’s getting everyone aligned on the same goals.”
Michael Cometz, General Floor, Bellmawr, N.J., was impressed. “I thought this was the most fabulous best practices presentation in all the years we have been doing it.”
Flick garnered praise for the way he is approaching installation challenges. Snedeker said Flick showed NFA members how he addressed some reoccurring installation issues by pulling his team of mechanics into the total organization. “Through a series of feedback from customers and job performance, everyone is held accountable for their part of the total finished product,” he explained. “I thought it was innovative and spot on. This was an inspiration for all of us to try to do something different in our own organizations to address the biggest issue retailers face today.”
Philip Raby, The Raby Companies, Albuquerque, N.M., found value in a discussion where the members talked about their favorite suppliers. “It’s amazing to me how well some suppliers did over others. For example, Shaw did extremely well. Some said Mohawk and Dal-Tile. This gives me a good feel for what my NFA partners are doing.”
Ambassador’s Taylor put it in perspective. “This is not a buying group; it is so much more. It may have at one time been a buying group, but today it is about developing partnerships with vendors and the exchange of ideas that benefit each of us. We all have the same struggles, particularly human resources and finding the right people. As a group, we all come together and put our heads together as opposed to being on an island of our own. We can ask each other what has worked in all these different markets.”
Manufacturers step up to the plate
When dealing with a group of retailers that collectively do more than $1 billion in business a year, suppliers go the extra mile to give NFA members a competitive advantage. This may come through exclusive products, special pricing or first look.
USFloors was a prime example at this meeting. “We presented an exclusive collection consisting of 21 private decors,” said Piet Dossche, CEO. “We listened to what they told us [at the last meeting]. The success of our COREtec program has created price and margin pressure. So now the NFA has a collection that is unique for its membership and they can enjoy full margin protection. It’s under the Lifetime Luxury name; however, it shows the COREtec label and logo on the display because COREtec has become a brand within the industry.”
Cam Haughty, ICC Floors, Indianapolis, liked the exclusivity and the visuals. “We will take that on for sure. I like the fact they are holding that quality and price point in the category. USFloors separates the quality products from all the commodity stuff out there.”
Mohawk Hard Surface was also up to the task of bringing NFA members some exclusivity. According to David Holt, senior vice president, NFA retailers will be first to market with exclusive styling, marketing and merchandising. “We are giving NFA a six-month run on the product.”
Case in point: Mohawk came to the table with new designs in its new SolidTec “rigid vinyl” program, which is its answer to the WPC craze. “WPC is just a way of making rigid vinyl,” said David Holt, senior vice president. “Our solid vinyl has no ‘W’ in it. It’s pure vinyl with a lot of calcium.”
Likewise, Shaw Hard Surface is also bringing some exclusivity to NFA members, according to Welton Davison, director of national accounts. “We are bringing them three things: first look at product before it comes to market in January; compelling pricing, which essentially gives them a significant delta over the rest of the account population; and we are also creating unique constructions of colors, widths and attached backings that would be exclusive to NFA.”
Emser was touting its tile and stone growth and expansion to NFA members. “We are up to 70 locations nationwide, said Bob Baldocchi, CMO and vice president. “We are building a new distribution center in Virginia, which is pretty exciting, especially for the East Coast members. “Custom” is the key word, he said, when it comes to giving members a competitive advantage. “What we offer is really about the programs we put together for them on a national basis annually. What’s unique about how we manage this group is every member has his or her own unique portfolio of what they do; we cater to that. We try to work to their strengths and advantages. We also come to them with unique and special deals as it relates to product and pricing.”
Tarkett focused on a new private-label laminate collection under NFA’s proprietary Lifetime Luxury brand featuring 19 of the company’s best selling, 12 mil products. “We have had tremendous growth with the NFA over the last two years and are building on that momentum,” said Randall Sheehe, director of strategic accounts. “This is the only laminate brand in the industry with the asthma and allergy certification. It’s a reclaimed collection that really ties in with consumer trends.”
Sheehe said Tarkett is also looking to help NFA members through advertising. “We are introducing a Google Ad Words program that will help them get customers into their stores through digital marketing. We know where consumers are starting their search; it’s through their mobile device or tablet. We want to help NFA members tap into that.”
Other companies, such as Beaulieu America, took a more general approach going beyond product specials. “We are talking about the new Beaulieu, how we’ve restructured the company and are bringing in innovative products,” said Paul Dominie, senior vice president, strategic accounts. “Nylon is our corner piece right now—solution dyed, prints and loops. We are offering members some unbelievable prices per ounce right now on filament polyester.”