Whistler, British Columbia, Canada—Against a picturesque backdrop of snow-laden mountains, blue skies and warmer-than-expected temperatures, the National Floorcovering Alliance hosted its spring meeting a few weeks earlier than usual here in this resort town two hours north of Vancouver.
As the 42 members and 26 vendors came together for three days of business meetings and relationship building on the slopes, the NFA board took the time to sit down with FCNews publisher Steven Feldman for a wide-ranging interview.
Participants included Jason McSwain, McSwain Flooring, president; Ian Newton, Flooring 101, vice president; Raffi Sarmazian, Sarmazian Bros., secretary; Eric Mondragon, RC Willey, treasurer; and board members Deb DeGraaf, DeGraaf Interiors; and Darren Hearns, Great Lakes Carpet & Tile.
What was the focus of this meeting?
McSwain: We focused on the core goal: for members to be better equipped to lead profit growth in their businesses. It’s a changing marketplace with training needs on constant new product introductions, so our goal through the committees is to sift through it all and filter that down so we can bring a very efficient meeting. We also changed up the format a bit, which was fun.
DeGraaf: The energy level was a little higher because of that.
Hearns: It was definitely well received. Everybody was glad we did something different.
Talk about some of the changes.
Hearns: Instead of doing a two-minute drill like we typically do where all the members speak, we basically randomly selected about 35%. Then we did a breakout session where the group was divided into three sub-groups with two or three board members in each, and the board communicated what it was working on and asked for feedback. We are just trying to improve communication. I think most everybody appreciated the fact we were doing that.
DeGraaf: I think they appreciated the transparency. Full disclosure. Just letting everybody know what our objectives are.
What are you working on right now?
DeGraaf:We have a number of important topics that keep coming up at every meeting.
Newton: Yeah, the question is always growth in the group. How do we grow? Do we need to grow? What direction do we want to grow? As you know, we’re all very close and very open to sharing ideas. That’s really the core value that we all bring to the table.
Mondragon: It gave some of those an opportunity to voice their opinions, give feedback, where normally in a larger setting they don’t get the opportunity. We are able to have more one-on-one discussions in breakout sessions.
McSwain: The board serves for the benefit of the members. We’re in alignment, but at times there’s the question of how do we help between the meetings, increase what we’re working on and how do we make sure flow-in is healthy? We just want to move that to another level.
Any surprises that came from these breakouts?
DeGraaf: I don’t know so much as if it was a surprise, but the similarities of what came out of each breakout was quite astounding. Here you take three different groups of people, but it just shows we’re all here for one major purpose.
What are members tasking this board with?
McSwain: Part of our goal is the continuity from board to board. There were some initiatives that were in place from the previous board that we wanted to make sure got played out, and they did at this meeting as far as change of structure. Look, if there’s any member who doesn’t feel like they can very easily get an idea, or a need into a pipeline and have people jump right on it, and start working for their benefit… It happens every day of product searching, the network that we all have in inventory and how we can support one another.
When it comes to digital or social media, are you doing anything collectively as a group for the members?
DeGraaf: We talk about it nearly every meeting, whether it’s part of our two-minute drill or one of our speaker’s presentations. We always discuss social media, but we’ve never initiated a platform we all jump in on.
McSwain: We have vendors like Podium, which different members have utilized over time. Some were on it originally, so that’s been a good partnership.
DeGraaf: That’s been great for us. Again, it’s one of those things that not everybody has to take. It might not work for some people, or they might be with somebody else.
Mondragon: Because everybody’s business model is so different that we just try to provide a tool that may work for some and not work for others. Hopefully one of those tools will work for each member.
What’s the best thing that Podium has done for your business?
DeGraaf: Ease of communication with our customers. It’s so simple to remind them of an install. It’s kind of like a dentist. Type C confirming your appointment, and we hear right back, and our reviews have grown significantly because we’re asking for reviews from the same number that reminded them of their installation, so there’s connectivity there through the process. That’s the reputation management component.
The person who would always do my reminder calls for installation, she can do it in a fraction of the time because you don’t get the chatter. I don’t want to say unnecessary chatter on the phone, but you’re reaching them whether they’re at work, whether they’re in their car driving, and they get to a red light, and they can hit C to confirm their install vs. leaving a message at their house. Then you’re like, “Are they going to call back?”
Newton: Yeah, are they going to call back when they get off of work at 6 at night and the store may be closed?
Mondragon:It has become the new way of communicating with our customers.
Armstrong Wood was a big part of your private-label program. What happens now? Does AHF become another core vendor?
Newton: Yeah, they have. They’re a core vendor for the group, and we’ve started working with them on the hardwood committee, and there’s a tremendous amount of opportunity between the NFA and them to put together some programs that are really beneficial to both. Obviously, it remains to be seen how great that’s going to be but they’re really excited about it. I think they’ve got a lot more freedom to do different things with the group than what they had before under the Armstrong umbrella.
McSwain: We’ve been closely connected with Brian Carson and Steve Staikos as to where they see the opportunities. Steve has been a great, creative partner with NFA for a decade and a half or so. We’re eager to see how that team now moves forward. They see opportunity in a lot of areas.
What suppliers are stepping up their game for the NFA these days?
Hearns: Cali would be my choice. Their service, marketing and, of course, the pricing has been very impressive, so we’re doing very well with them.
Is it proprietary product? Is it pricing?
DeGraaf: I think as a group, we have to look at all facets. If you have good price but you don’t have other things, then you’re not going to hit a home run with our group. If you have a well-rounded offering, that is where you get the attention. For the first time this year, we had a pallet buy. We’ve had roll buys for years. Shaw and USFloors won the pallet opportunity.
Mondragon: If I were to pick one vendor that has stepped up, I would pick them as a combined entity because they came together. Shaw and USFloors in the beginning were running separately, as they always had. When the pallet buy offering came up, they decided to come in as a unified company and say, “We’re going to offer you something from both manufacturers that you can take advantage of,” and because of that offering, and as Deb alluded to, they had the whole package with the pricing, the program, logistics, everything that could be combined.
DeGraaf: It was nice to see them come in the same side of the ring rather than just totally competing against each other. Because the first few markets after Shaw had purchased USFloors, I felt like I’m at a competitive show. Who gets to talk to you first, make sure you buy our stuff. I’m like, “Y’all are under the same umbrella now. Be nice.” Everyone is playing together in the same sandbox now.
Mondragon: I almost think the group can take some credit for forcing them to come together because of the presentation. We pushed the issue.
DeGraaf: Don’t make us choose between the two. Let the product dictate what direction we go.
Any other suppliers doing a real good job for the group?
Newton: I think both Shaw and Mohawk have upped their game on the hard surface side. Probably over the last year or 18 months, their product offerings have just made leaps and bounds from what they were offering a year and a half ago. I think they’ve come to realize given the threat of the imports from Asia, they had to up their game. They had to offer better products, better-looking products and at a competitive price point. I think that was good to be able to give a lot more business to domestic companies rather than have to rely on imports all the time.
CRI says residential carpet was down less than 1% last year, but between 4% and 5% in terms of yardage. How’s carpet been for NFA members?
McSwain: For the NFA, we grew our carpet sales last year. That’s important. The spring NFA meeting is the right time because you have all your numbers in, and you can see vendor by vendor and see how it rolls up as a category. Then you can say, “Hey, was it in commodities or was it in some fashion brands?”
What did you find out?
McSwain: Fashion brands. We had a lot of growth in Karastan.
Newton: The yardage was down slightly, but the actual dollar volume was up.
DeGraaf: Which means we were obviously buying better product on the average.
And you’re selling better products, like Karastan and Tuftex.
DeGraaf: Even the higher level of the Philadelphia, too.
McSwain: Fabrica was a big one that had grown as a percentage from the year before.
Hearns: We had a quite a bit of growth with Dream Weavers as a group.
DeGraaf: Carpet is still important.
Let’s talk Domotex USA. The NFA came out in support of Domotex, right?
DeGraaf: I guess; not officially.
You went to the show. What were your thoughts?
McSwain: I went, Ed Keller from Hadinger’s in Florida went and so did Lisa [Browning, NFA executive director], so those were the representatives from the NFA. We see the value in what that group is trying to create. We can see why a show near Dalton to tour the mills is valuable, that shows on both the East and West Coast are valuable. But today, Surfaces is really the conduit for our team to come together, to see a broad range of product. Next year Domotex will be closer to Surfaces, so that might allow people to make a decision. Shaw won’t have their every-other-year SFN meeting. But last month, what we saw, the retailers in the exhibits weren’t to the number they had anticipated.
What would Domotex have to do to make it attractive for you to attend?
Hearns: Well, basically, the NFA meeting would have to be in Atlanta. Because of our commitment to the NFA, we go to Surfaces. It doesn’t make any sense for me to go to Surfaces and Domotex, even though I am fairly close to Domotex. I don’t know why there’s a need for two shows. I just don’t see any benefit to going to a show so close after Surfaces.
McSwain: The vendors had great presentations, good booths, well-staffed. But as we engaged with each one of them, they all prefaced it by saying, “Well, I don’t have anything new.”
One manufacturer told me he didn’t see one person he hadn’t seen at some point during the first two months of the year.
DeGraaf: Right. Between the regional shows, the buying group shows, Mohawk’s Edge, the Shaw convention and Surfaces.
McSwain: That’s redundancy. If there’s not a timeframe where there’s going to be something new [at both shows], you’re going to make the choice of your time.
Specialty Vendor Showcase. Smaller but probably more effective. Who stood out?
Newton: Hamstead Home has had a lot of growth with the group in one year. They put together a great package—a private-label display, a website for the group. And they’ve stressed some interest to step up and become core. We have at least three specialty vendors that want to become core vendors if the opportunity arises.
Sarmazian: Republic. I think the way the products look they sell themselves, and the way they’re merchandised stand out in the showroom compared to everything else. They have taken the SPC category and have stuff no one else has in terms of visuals.
Mondragon: For me, it was Republic as well because of local distribution. It makes it easy for me to support a local distributor and have access to that product without having to make a big commitment.
Sarmazian: I’m glad there were two Canadian vendors in the specialty vendor meeting: Beaulieu Canada and Twelve Oaks. That is good for our Canadian members. I’m glad they have a showcase to get their product out to American retailers.
McSwain: Most important for the board was the takeaway from today’s breakout sessions that the vendors who took part in that showcase really fit members’ needs.
Any prospective members? The NFA hasn’t added anybody in a few years.
DeGraaf: Not really. We’re always listening, but I wouldn’t say there’s somebody we’re looking at specifically.