Freight woes force dealers to adjust on the fly

Home Featured Post Freight woes force dealers to adjust on the fly

By Ken Ryan The California ports of Los Angeles and Long Beach have been overburdened by container imports over the last few months, resulting in a logjam of freight that has led to product shortages and delays for flooring retailers, mostly in the LVT category.

While record shipping volumes would have been a strain on the ports under normal conditions, the situation has been worsened by spikes in California’s COVID-19 cases, leaving these ports short-staffed. According to port of Los Angeles Signal port optimizer data, the average time ships are waiting at an anchorage for a berth is now almost eight days. When vessels do get a berth, operations are hit by massive congestion at the terminals.

From his location in Anaheim, Calif., Dan Mandel, co-owner of Sterling Carpet & Flooring, said he can literally see the problem and knows it won’t be resolved overnight. “Being by the coast in Orange County you can see a huge number of freighters sitting on the water waiting to get into the port of Long Beach,” he told FCNews. “It’s crazy how many ships are out there right now. Our manufacturers are telling us within the next month we should be expecting very long delays, but luckily we were proactive and loaded up on a lot of inventory prior to this, so I feel like we are well positioned to get through it.”

Whether it is freight delays worsened by COVID-19, ongoing tariffs or occasional worker slowdowns at the ports, flooring executives say they know they must plan accordingly when it comes to imports. A case in point is Frazier’s Carpet One Floor & Home, Knoxville, Tenn. For more than a year, Kevin Frazier, owner, said he has been working around potential issues by stocking more than he needs and buying additional stock far earlier than he normally would—that includes advanced orders of containers full of stock. “We stock more than 40 SKUs of LVP and while only about one-third of those SKUs are from China, more than two-thirds are from overseas. So, the good news is that as long as a bunch of supply-chain headaches from multiple suppliers don’t all hit at once—and/or drag on forever—we have lots of stock across which we can spread the supply-chain headaches.”

Similarly well-positioned is Montgomery’s CarpetsPlus ColorTile in Venice, Fla. The multi-chain retailer has the financial resources—as well as the storage capacity—to buy larger quantities of the stocking LVT it uses on a regular basis. “We have a large selection of LVP in stock currently and our private-label line, Sidewinder, is strong in all colors in mill inventory,” said Mike Montgomery, co-owner. “It definitely helps save a sale.”

For RC Willey, with 15 locations in four Western states, the biggest impact has been the cost in freight and the length of time it’s taking to receive product. According to Eric Mondragon, hard surface buyer, RC Willey Flooring Division, his only option is to pass on the price increase to consumers. “The only way to work around it is to promote our strength, which is in our inventory, and we currently have plenty of inventory. We can usually find something in stock that fits the customer’s needs.”

Disruptions within and around the supply chain are nothing new for Eric Langan, owner of Carpetland USA (The Langan Group), with nine locations in eastern Iowa and western Illinois. But that doesn’t make today’s mess any less tolerable. “It continues to be challenging and this even goes back prior to the pandemic,” he stated. “It’s extremely frustrating that back orders being presented are not accurate and get moved back several times before you eventually receive the product. It stresses the relationship with our customers when we don’t provide accurate information to them.”

Saying he has “lost confidence in the supply chain,” Langan said he began renting an off-site warehouse to bring in more inventory of his top sellers so he could have guaranteed product on hand. “It’s an additional expense and exposure for me—which I’m not excited about—but it reduces potential shortfalls in the supply chain,” he explained.

Distributors chime in

As lead times for Pacific-bound freight lengthen, flooring distributors are forced to work creatively with suppliers. Top 20 wholesaler FlorStar Sales, Romeoville, Ill., has been working on creative solutions with its suppliers, some of whom keep domestic safety stocks. “Also, we are fortunate that as part of the Bravo distribution group [a consortium of 13 distributors], we have active trading and inventory-sharing agreements with a national network of partners,” said Scott Rozmus, president and CEO. “All of this only gets you so far, however, when everyone is in the same boat. Thus, we are also working to offer clients alternative solutions. Without question, some product lines and vendors are in much better shape.”

West Coast-based Galleher, a top 5 distributor, has been aggressively placing orders for nearly a year, according to Jeff Hamar, vice chairman of the Santa Fe Springs, Calif.-based wholesaler. “Clearly, times like these reward strong relationships between distributors and suppliers—and companies with excellent balance sheets and capable management will do much better than the industry as a whole,” he said.

As for consumers, Hamar said they are going to have to be open to alternative products if they can’t wait for their desired product to be available. “There is still a lot of inventory in the system—it’s just that some hot SKUs will have delays, but the exact same product in a slightly different coloration might be available.”

The potential shortage of LVT-related products opens up opportunities for flooring sourced elsewhere. “We absolutely are emphasizing other products and categories,” Rozmus said. “For example, there is no issue with Atlantic freight, at least none that we are seeing. This puts products like Sono Eclipse, the PVC-free, waterproof flooring from Inhaus in Germany, in a unique and enviable position. That product offers unique features and a somewhat unique supply chain that clients are finding increasingly attractive. We also are emphasizing lines like LifeSeal (Bruce’s SPC product) and AxisCor that we not only have strong inventory positions in but whose suppliers keep massive stateside back up inventories in as well. Despite all of the logistical challenges we’ve faced, these suppliers have helped us maintain a very high level of service on those lines.”

Retailers are also applying other creative solutions to the backlog of certain LVT/P products. At Carpetland, for example, RSAs are encouraged to revisit other product categories that they have overlooked in the past. “We’ve been encouraging our sales reps to get reaquainted with the laminate product category,” Langan said. “We know the home centers do really well with this category and we should be showing and selling this category more.”

Must Read

Footprints Floors launches The First Fruits Fund

Littleton, Colo.—Footprints Floors, a 160-plus-unit flooring franchise, said it prides itself on being an organization that believes in the greater good. The brand recently...

TDG announces digital strategy for 2023

Dalton—The Dixie Group (TDG) has unveiled its digital strategy for 2023, which includes enhancing its digital capabilities by partnering with several companies to create...

Stanton removes hard surface freight surcharges

Woodbury, N.Y—Stanton has removed hard surface freight surcharges for DWF and Vanguard Flex beginning with shipped orders Monday, Dec. 5. "We hope this will make...

Karndean launches new Opus visuals

Export, pa.— Karndean Designflooring introduced new commercial market-exclusive abstract visuals in varying size formats. The company said these visuals are designed to interact with...

Retailers React: What’s your strategy for finding new installers?

Every two weeks, FCNews seeks out flooring retailers across the country to offer their advice on hot topics of the day. This week we...

Happy Feet, Welspun partner on charitable product offering

Dalton—Happy Feet International is expanding its offerings to include new products from Welspun Flooring where a portion of every Welspun sale will go toward...

As seen in

March 15/22, 2021

DOWNLOAD
Some text some message..
X