By Ken Ryan
Savannah, Ga.—Most flooring conferences and conventions are mainly feel-good affairs that celebrate success and growth opportunities for members. The Haines Loyalty Club Summit, held here March 14-15, was a mea culpa of sorts—a sincere promise to do better after the industry’s largest distributor hit a rough patch.
Hoy Lanning, who was named president and CEO of Haines in December 2018 (FCNews, Dec. 10/17), apologized for the company’s missteps and vowed to make things right for members and suppliers. “I’ve never been one to say or be ashamed to say, ‘I am sorry,’” he told audience members. “If you would just fess up to your sins, you’ll be better off. We have not been a stellar supplier for the last two years and I thank you suppliers for sticking with us.”
While Haines remains the industry’s largest distributor in revenue, more than double No. 2 BPI, revenue has slipped from $490 million in 2017 to an estimated $470.5 million in 2018. A host of issues, from inventory management to service, have plagued the 145-year-old wholesaler.
In 2017, Belknap White Group, the No. 3 distributor, and Haines entered into a strategic partnership whereby Belknap took an initial equity investment in Haines. Last month, Belknap White announced an expanded equity investment that gives it a controlling interest in Haines. The partnership allows both companies to collaborate and work together to build an East Coast flooring distribution platform. Haines continues to operate as a separate entity. “The investment is a good thing,” Lanning told FCNews. “Having a good partner in business is good for our customers, our associates, our suppliers. Our suppliers have good relationships with Belknap, and they are well financed.”
The HLC Summit was the first opportunity for Lanning to meet and greet members and to express his gratitude for their loyalty and patience amidst trying times. He said he is determined to make Haines great again, “and I will stay here until we do. Know that we will get better.”
It has been a memorable last few years for Lanning, the former CEO of CMH, which was acquired by Haines in 2014. He stayed on during a transition period, then announced in early 2017 that he was retiring at the end of the year only to be persuaded to stay on as CEO advisor to assist Mike Barrett.
In November 2018, he was honored with the NAFCD Lifetime Achievement Award during the group’s annual convention in Dallas. A month later, Lanning was named president and CEO of Haines.
Retirement can wait a while. “I feel re-energized,” said Lanning, who brought on top lieutenants Jon England as chief sales and marketing officer, and Mike Johnson, vice president of product and marketing. Both England and Johnson joined the distributor in 2018. “I am so happy to have these guys here,” Lanning added. “They have brought a professionalism to the organization. They are very smart and have a lot of experience.”
England described the HLC Summit as an “organizational kickoff” for Haines. “We got into a spot where we were paralyzed, couldn’t execute different things. We can execute now—the last couple of months, we are moving, we are not sitting still.”
Among the issues that hamstrung Haines was inventory management. It had too much inventory that was not selling and a glut of back orders. Servicing its customer base in 
a timely manner was another problem.
Lanning asked, “Can we fix inventory? We really can. Logistics? We’re fixing that. We’re changing the culture, that’s the biggest issue. When we make a mistake, we’ll recover extraordinarily. We care, we listen and want to do something about it. Many of our customers were coming up to us and saying, ‘We are with you.’ I think we got away from being regular people.”
The way forwardAs part of its restructuring, Haines will focus on category management as opposed to focusing on brands. It will also divide its account executives into two groups—resilient and carpet cushion—and wood, laminate and ceramic.
Its inventory will be pruned to eliminate products that are not turning. “As for our SKU rationalization, we will go narrow and deep in inventory and align our capital investment,” England explained. “This is not some new innovation rocket science. We are just working on the fundamentals—not being something we were not, but someone we need to be.”
The consensus among conference attendees was Lanning’s confession was genuine and heartfelt. Several Haines retailers said they remain 100% behind the company and have faith in the new leadership. “I can tell you the confidence in Haines has gone way up in the last six months,” said Bill Zeigler, co-owner of Charles F. Zeigler & Sons, Hanover, Pa. “Hoy is re-energized. He wants to see this through. The sermon Hoy preached really resonated with dealers.”
Barbara and Joseph Bauer, co-owners of NAFFCO Floors & Blinds, in Tampa, Fla., were also on board with the changes taking place. “There has been a tremendous turnaround just in the last few months, and I believe it stems from [Lanning] and the leadership team he has put in place,” Barbara Bauer said.
Deborah Tartal, co-owner of Floors and More, Lewes, Del., has been with Haines for two decades. She said she will stay the course. “We’re here, so we obviously support them and will continue to. They have always been very supportive of us.”