There are numerous benefits and advantages to be gained in operating multiple retail flooring locations. First, owners of multiple locations enjoy greater market presence. Second, that brand awareness typically translates to higher market share in a particular region. Third—and probably most important—are the additional revenue opportunities afforded to owners by operating numerous locations.
At the same time, running multiple flooring stores comes with some challenges, particularly from an operational/management perspective. In polling several owners and managers of retail operations with multiple locations, some common themes and best practices begin to emerge. High on the list is empowering managers to make decisions at the store level instead of owners trying to manage the day-to-day decision making at each branch.
“Managers must be empowered to be able to make decisions regarding their stores,” noted Eric Langan, president and owner of Carpetland USA (The Langan Group), which consists of nine stores across Iowa and Illinois. “If there is a large customer service issue or an employee issue, our store managers are then instructed to reach out to their senior manager for assistance.”
Other owners of multiple retail locations also embrace that philosophy. Take Bob’s Carpet & Flooring, which services the Tampa, Fla., area, for example. When you’re running 16 locations, you have to have systems in place at the store level in order for things to function smoothly. “Trying to manage the day-to-day operations for 16 locations is nearly impossible,” said Ashlie Butler, president. “You need to have trust in your managers, and one of the ways we do this is to get together monthly to make sure everyone is on the same page. It’s extremely helpful and keeps us connected.”
There are times and situations, however, where it’s best to centralize certain functions of the business in order to streamline operations. For instance, at Baker Bros. Area Rugs & Flooring, which runs seven stores across the state of Arizona, all software systems, bookkeeping, ordering/billing and training functions are completely centralized. “If you want to run one business with one set of guidelines and where everyone speaks with the same voice for a ‘same’ experience, you cannot have independent functionality at almost any level,” explained Phil Koufidakis, president.
Raffi Sarmazian, general manager of Sarmazian Bros., which operates three locations in the Tri-Cities region of Ontario, Canada, agreed. “It is very important to standardize basic operations across all locations as this will help create efficiencies and streamline our processes across departments,” he explained. “Sometimes a store will try a new way of doing things and if it works we can implement it across the board. Having meetings with the same departments from different stores helps us learn from each other and do things better.”
Carpetland USA’s Langan is also of the opinion that you need consistent standards throughout all locations. “Our stores are to look alike, merchandise alike and operate alike. We do ‘house’ certain functions such as A/P, bookkeeping, ordering, etc., at a hub or two, but all other operations should be seen as consistent across all of our locations.”
Ditto for Bob’s Carpet & Flooring, whose stores run on the same systems. “We have a great team at our corporate location that keeps the bigger operations running smoothly,” Butler explained. “Also, all managers are encouraged to reach out with questions to the team if needed. We are always running mini-training classes in our stores as well, to keep everyone sharp—whether it’s a new hire or someone who just needs a brush-up.”
You better NOT shop around
One might think that most aggressive consumer price shopping occurs between independent retailers and home centers/big boxes—not necessarily between retail stores of the same chain. Surprisingly, the phenomenon is very common among independent specialty retail stores that operate under the same banner. Retailers have their methods of dealing with these situations as well.
“This happens often,” Baker Bros’ Koufidakis said. “However, when you run central and you use a CRM properly, the customer gets outed. How do we handle it? We speak with one voice, and our processes are centralized so the customer gets the same answer in both showrooms.”
Bob’s Carpet & Flooring has also run into this situation before. According to Butler, it can be a little sticky. “The sales staff are trained to look for this scenario,” she explained. “If this does happen, we are up front with the customer and will also let the other locations know as well. Nobody wants to be underbid by their own people!”
Similar measures are in place at Sarmazian Bros. “Sometimes customers will shop between our locations so it is important to be consistent with our retail pricing and discount structures,” Sarmazian explained. “RSAs need to create a new quote in our database when estimating a job, especially when providing pricing greater than our posted retail pricing. We have set discount tiers that need to be followed and get management approval. If the customer deals with more than one RSA, sometimes we split the commission.”
While it’s not so common at Carpetland USA, it’s still an issue they have to deal with from time to time. “When it does happen, we try to be as customer friendly as possible,” Langan explained. “If our RSAs do a good job of qualifying the customer, they should be able to get the information out of the customer if they have shopped at another one of our locations. If we know up front, we will suggest that the customer work with the original RSA from the first location shopped and to politely let the customer know that we do not compete against fellow locations. If we don’t know that the customer has shopped another location until the end of the process, we will honor whichever price is lower—hopefully they are the same.”
