FCNews exclusive: Industry looks to stimulus deal for a lifeline

Home COVID-19 FCNews exclusive: Industry looks to stimulus deal for a lifeline

President Trump signed a history-making $2 trillion stimulus bill into law that aims to provide much-needed economic assistance and relief in response to the COVID-19 pandemic.

By Reginald Tucker

The much-anticipated $2 trillion stimulus package recently signed by President Trump in response to the impact the novel coronavirus (COVID-19) has had on the U.S. economy was well received by large and small businesses alike when it was signed into law on Friday, March 27. The wide-ranging, history-making relief package aims to address a host of urgent and pressing needs facing many businesses and individuals reeling from the disruptions caused by the global pandemic. While the full impact of the stimulus package isn’t expected to be realized for several weeks or even months down the line, flooring industry members said they like what they’re seeing so far.

“I was never one for the government to be involved in our daily affairs, but in this situation, it was essential,” said Scott Humphrey, CEO of the World Floor Covering Association (WFCA). “The people didn’t cause this crisis, and we should not expect them to get out of it on their own. In that respect, I do think the stimulus will help. When you put that money into families’ pockets, it says to them that the government supports them and has their backs. But even more than the money value—it’s the confidence value. We’re all afraid, but fear goes away when you have the knowledge. The more we know, the more we know who’s supporting us and where we have to go to get support. That’s our purpose as an association to disseminate that information to the industry.”

The fact that WFCA membership spans all the various sectors within the industry—retailers, installers, manufacturers, inspectors and distributors—gives the flooring industry at large more weight and credibility when it comes to influencing legislation in Washington, according to Humphrey. The group, whose membership has quadrupled in the past few months to roughly 5,000, has taken the lead on disseminating invaluable guidance to the industry at large in the face of this pandemic. In fact, through the cooperative efforts with its government relations partner, Lobbyit, WFCA has become instrumental in tweaking the final language of legislation, which was ultimately signed into law.

“Our representatives in Congress want to know how many members you have—for them that means votes,” Humphrey explained. “With our expanded membership, we can go to Washington and say, ‘Hey, we represent retailers, installers, distributors, inspectors, manufacturers. We now have that scale and size.”

Around the industry, the stimulus package is receiving broad support—especially among flooring distributors. For Dunn Rasbury, director of business development for Atlanta-based A&M Supply, and current president of the North American Association of Floor Covering Distributors (NAFCD), the relief package is good news. “The stimulus should help, and I do believe that once the virus runs its course, business will return to normal pretty quickly.”

In the meantime, A&M Supply is hunkering down for a rough ride. “The lack of any real clarity about the timing of the curve of the virus makes predicting anything very difficult,” Rasbury explained, noting that he has seen traffic among his customers slow appreciably. “We’ve pulled our outside sales team out of the field, and they are working with their customers via email and phone. All of our branches are currently working at full strength.”

Like A&M Supply, Santa Fe Springs, Calif.-based Galleher, a top 20 distributor, is still open at all 26 locations—although some with reduced hours. Jeff Hamar, president, feels the stimulus bill signed by President Trump will provide a cushion in an economy that’s reeling from the blows of the virus. “The massive federal monetary and fiscal stimulus actions should go a long way in protecting affected workers and companies during this unprecedented time, and position the country for a strong recovery,” he said. “The hardest thing is getting clarity on what is going to happen. I’ve never managed through anything like this before.”

Retailers are hopeful as well. With so many flooring dealers forced to lay off workers and cancel projects, federal assistance will allow some to soften the blow. “Thanks to the economic stimulus package, it looks like we will be able to continue to pay our employees and other qualified expenses,” said Brian McCarver, owner of Brian’s Flooring & Design, Birmingham, Ala.

Retailers agree the availability of loans for small businesses is critical. At the same time, some have expressed concerns about taking on additional debt during this unprecedented pandemic. That’s not the case for dealers like Lou Morano, president of Capitol Carpet & Tile, with five locations in Florida. Right now, he’s all in. “If you’re going to make it through to the other side, you have to borrow the money,” he told FCNews.

While some of Morano’s stores are still performing installations for the customers he has been working with over the past few months, new walk-in business is nonexistent. And while he is still receiving some phone calls and setting up measurements, he expects the pipeline to dry up very soon.

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