September 3/10, 2018: Volume 34, Issue 6
By Ken Ryan
When suppliers and distributors talk about their business experience with Rite Rug, they invariably invoke the name of Michael Goldberg. That’s because so much of Rite Rug’s legacy stems from Goldberg—his passion, business acumen, vision and willingness to take risks in transforming a carpet retailer into a multi-dimensional flooring enterprise.
“I admire Mike Goldberg for taking over a successful business that his late father built into a significant size, and then taking it to an entirely new level of business,” said Jeff Meadows, senior vice president, residential sales, Mohawk. “I’m sure Duke Goldberg would be very proud of his son.”
Tom Lape, president of Mohawk Residential, said he was reminded of a quote by a famous English novelist that applies to Goldberg. “When asked about the secret of his success, Charles Dickens responded, ‘Whatever I have tried to do in my life, I have tried with my heart to do well.’ This statement also reflects the reason Michael Goldberg has led an enduring business for so many years,” Lape said. “Michael pours his heart and soul into Rite Rug. The same passion he has for his business he has for travel and his art collection. Michael is direct; he’s a skilled negotiator and he’s tough. However, when he makes a commitment, he lives up to that commitment. Business is never easy, but it takes heart to do well.”
Vance Bell, CEO of Shaw Industries, has been doing business with Rite Rug and Goldberg for nearly 30 years. He says the one thing that separates Goldberg from other retailers is that he is part old school and part new school.
“I compare him to some of the old-line retailers like Marv Berlin. He knows exactly what he wants and has a plan to get it. He is very focused, very aggressive, understands his business model and executes it very well. He knows what he wants and knows where he wants to be.”
On the other hand, Bell said he keeps up with the latest innovations—product or otherwise—and is always keeping his stores fresh and vibrant.
David Flaum, former president of the Ohio distributor CDC, agreed that Rite Rug’s strengths and accomplishments today can be traced to Goldberg “and his energy to challenge his distributor and mill partners to come up with the most competitive program he can get behind to drive sales.”
Like many, Shaw recognizes the importance of doing business with Rite Rug. “Rite Rug is a bellwether account in Columbus and the other areas in which they do business,” Bell said. “So it’s always important to have your product positioned with him. He likes us, and we do a good job servicing him. Michael is more than a good customer; he is a good friend.”
Multiple roads to growth
For most of its 84 years, Rite Rug was a large and successful seller of flooring in the Columbus, Ohio, market. When the time came to increase business through diversification, Goldberg seized on opportunities, including acquisitions and expansions.
Today, Rite Rug operates 10 divisions: Rite Rug retail stores, new construction, property management, commercial, Michael David Design Center, Rite Rug Floor Care, Flooring Distributors Wholesale, Creative Hardwood Floors, Realtor Direct and Windows Treated Rite.
“Rite Rug’s strengths are similar to other enduring businesses,” Mohawk’s Lape said. “They have multiple stores leveraged among many different areas of business such as retail, builder, multi-family and commercial businesses as well as professional cleaning services. They have continued to expand into new markets, and they are customer focused.”
Risk-reward approach
“By diversifying their business over the years and getting into the builder and commercial markets, they have spread out the risk of any one market being down,” Meadows added.
This risk-reward approach has earned Goldberg a legion of admirers among his suppliers. “Michael is a businessman who is committed to—and passionate about—his company,” one supplier said. “He challenges us to be our best, and if we deliver he rewards us with business.”
To illustrate Goldberg’s risk-taking flair, Flaum recalled an episode where Goldberg was negotiating a deal with a manufacturer. Goldberg and the manufacturer’s vice president of sales went back and forth negotiating over $10,000 in advertising money. At some point, Goldberg stopped the haggling and challenged the vice president to “flip for it.” Goldberg, “naturally,” Flaum said, won the bet and took the 10 grand.
Jay Kopelson, vice president of corporate accounts, Mannington Mills, said Rite Rug’s philosophy is similar to Mannington’s. “Hire great people and let them do what they’re good at. Combine that with Michael’s business sense, and you have a winning combination. They’ve been a solid company for so many years.”
Perhaps no company has had a longer relationship with Rite Rug than Armstrong Flooring, which stretches for several decades, according to Steve Staikos, general manager, hardwood brands portfolio, Armstrong. Staikos said Rite Rug has built the success of its company on the pillars of focus and customer service. “They are diversified in multiple markets, which gives them a competitive advantage. They have also built their brand with aggressive advertising and promotion.”
Staikos shared an anecdote he feels best exemplifies the kind of business partner Rite Rug is. As he explained, “A few years ago, many flooring companies were looking to China for less-expensive wood imports, but Rite Rug elected to focus on quality and service. Even though many importers continue to offer deals, Rite Rug continues to believe in the quality and performance of Armstrong products.”
Other business partners attest to Goldberg’s approach. Midwestern distributor Gilford-Johnson Flooring has been doing business with Rite Rug for more than 10 years, and the experience has left an indelible mark on the company.
“Our experience with Rite Rug has been very pleasurable and rewarding,” said Rob Purkins, senior vice president of sales. “They’re a forward-thinking company that’s doing what it takes to thrive in a changing economy.”
.