Flooring dealers tackle extended freight delays

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port congestion freight delays
Due to extensive congestion in the ports, reports show product shipments may be delayed for several more weeks to come.

By Ken Ryan The freight delays that began in earnest in February 2020 have worsened over the ensuing months, according to reports. The disruption has the potential to impact flooring retailers well into 2021 as they scramble to fill customer needs at a time of strong sales activity.

While many dealers have the necessary inventory to deal with the current congestion, anecdotal evidence suggests the delays could last into the summer. According to Freightos, which operates an online international freight marketplace, locations in Asia to both the U.S. East Coast and West Coast are experiencing very high volumes and port congestion, pushing factory-to-door delivery times to an average nine weeks compared to four or five. There likely won’t be any significant easing of demand from Asia to the U.S. before peak season starts in July, experts predict, as retailers hustle to restock inventory and keep up with strong sales.

U.S. imports from international trading partners picked up as coronavirus restrictions eased and demand rebounded in the summer of 2020. The U.S. imported a record $219.8 billion in goods in January of 2021 on a seasonally adjusted basis, about 9% higher than a year earlier. Flooring dealers told FCNews that erroneous information they are receiving on inventory and delivery dates is compounding the issue.

Craig Phillips, president of Ohio-based Barrington Carpet, Carpet Country Flooring and Young’s Carpet One Floor & Home, said supply chain disruptions are just beginning to hit his businesses. “I fear the [disruptions] may impact all of us longer and potentially into 2022—no matter what our suppliers are telling us right now,” he told FCNews. “Spec changes and scrambling for enough inventory to cover our work on the books will prove to be a yearlong challenge, I believe.”

Phillips added that the “perfect storm” of supplier inventory issues, the lingering effect of the Texas freeze in February and the worldwide container shortage may negatively impact his business more than COVID-19 did last year. “There is no question we will have to work smarter and harder to overcome these new challenges,” he said.

To varying degrees, all flooring dealers have felt some level of pain with the supply disruptions, although it does help to be part of a larger group like the National Floorcovering Alliance (NFA). A case in point is R.C. Willey Home Furnishings, with 15 locations in the west. As Eric Mondragon, hard surface flooring buyer, explained, “We consistently have over 3 million square feet of flooring in stock, so I’m fairly confident that I have the inventory to withstand an extended slowdown should that arise. We have the ability to shift advertising from one category to another to promote what we have in stock or products that we have quick access to. The plan is to not put the consumer in an extended back- order situation unless it’s not an issue for them. If we qualify them correctly, we should always have the product they want when they need it.”

Other dealers are weathering the storm. For Baker Bros., with seven locations in the Phoenix market, the key lies in working closely with its vendor partners. “We have consistently tried to partner with companies that have been able to work through this, so we have mostly been OK,” said Phil Koufidakis, owner. “We definitely have some concerns, but we are managing through with good vendor partner communication.”

Communication is the key in the showroom as well, according to retailers like Mike Foulk, owner of Foulk’s Flooring America, Meadville, Pa., who has preached patience with customers on expected delivery dates and options if their flooring of choice is not in. “We have instructed our RSAs at the first sign of delays to give the customer a choice—wait on the material selected, knowing that the dates we have been given most likely are not accurate, or choose an alternative that we have already researched and know that it is available,” Foulk explained. “We have been requesting accurate dates as [suppliers] tell you a date and then move it two weeks and then move it another two weeks. All it does is tick off the customer.”

Bill Zeigler, who co-owns Charles F. Zeigler & Sons, Hanover, Pa., said the freight delays have coincided with multiple rounds of price increases, making for a particularly challenging scenario. He added, however, that consumers seem less impacted by rising prices. “The good news is demand for flooring has been so high that consumers don’t seem to mind the higher prices—delays in shipping and extended installation dates they do mind. [But] a few extra weeks is not causing as much trouble as it would in normal times.”

With all the nuances to tackle—and the possibility of the challenges remaining throughout the year—Chris Kemp, owner of Kemp’s Dalton West Flooring in Newnan, Ga., said the store and the staff have learned a “new way” of doing business. “We’ve started stocking much more inventory in order to fill orders quickly,” he explained. “Our RSAs are learning a new way of selling, too. They check stock with the mills before the customer leaves the showroom, and they sell more of what we have in stock.”

Distributors weigh in

Foulk's Flooring America freight delays
Foulk’s Flooring America in Meadville, Pa., practices patience with customers when it comes to expected delivery dates.

Flooring distributors are also working diligently to address freight delays. FlorStar Sales, based in Romeoville, Ill., has stayed in close touch with suppliers and shipping firms. The company is also relying on technology to help deal with the issue.

“Our demand forecasting tools have allowed us to anticipate the marketplace’s needs perhaps a little better than some competitors, so we have a healthy supply of material for our clients,” said Scott Rozmus, FlorStar president and CEO. “The demand forecasting tools allow us to utilize different pieces of data essentially to predict what inventory we will need at some future time. Like any predictive activity—think about weather forecasting—they are helpful but not perfect by any means. A challenge for pretty much everyone is that, unfortunately, we sometimes learn about a problem or challenge almost as it materializes because shipping ETAs just aren’t reliable right now.”

In times of freight disruptions, inventory is king. Midwest, a Salt Lake City-based wholesaler, began its inventory stockpile during the start of COVID-19 when it remodeled and reshuffled its existing buildings and racking to create more space for the future. “In one of our facilities, we created 900 new pallet locations by using the vertical space and rethinking our inventory,” said Eric Parrish, president. “We have over 300,000 square feet of warehousing in the Rocky Mountain region, and all of this space has been recreated to grow business by having local stock. We have large quantities of all stocking goods and feel great about our position.”

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April 12/19, 2021

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